In the year 2000, more than 5 million Germans will work under conditions considered as teleworking. Any services rendered outside of the business site through computer and modern communication are deemed to be teleworking. Teleworking services may be rendered entirely or at least partially from the teleworkers' home. In addition, teleworkers may also work in specialized teleworking business centers and - as an extreme example - an entire firm may be organized as a "virtual enterprise" with teleworking. Telecommunication techniques are developing. Already today, teleworking services are rendered from abroad, such as known computer programming in India. Thus, any future business organization must face the issue of teleworking.

To date, no teleworking employment regulations exist under German labor law. Teleworking issues can, however, be resolved with standard emloyment provisions.

As it is often the case with modern employment organizations, the first and most important issue of teleworking is whether or not the teleworker is deemed to be an employee protected under German labor laws. This issue is resolved by a standard evaluation of all circumstances surrounding the employment relationship.

As a general rule, if the services of the teleworker are rendered for only one company and if the teleworker has the obligation to be linked to the company during fixed business hours or has to render specific services, such teleworker is deemed to be an employee protected under German labor laws. Although no presumption of an employment relationship exists, teleworking is normally regarded as an employment relationship, unless the teleworker works for more than one company or is free to decide the amount of time spent and the services the teleworker wishes to provide. As a consequence, if such teleworkers are considered to be employees, they are protected by the German law against unfair dismissal (Kundigungsschutzgesetz), the law on mandatory holiday (Bundesurlaubsgesetz), and the law on the continuation of salary in case of illness (Entgeltfortzahlungsgesetz). Further, even if such employees do not work at the employers' working site, they are represented by the respective works council (Betriebsrat). In addition, works agreements (Betriebsvereinbarungen) and collective bargaining agreements (Tarifvertrage) apply to them.

The second issue in establishing a teleworking workplace is the teleworking employment or service agreement. As no specific teleworking laws exist, it is particularly necessary to implement explicit and specific teleworking rules and include in the agreement provisions relating to working time, employers' access to the home workplace, the ownership of the equipment located at the telework workplace, especially the party responsible for leasing costs for the equipment and energy costs incurred through of the equipment, serving of the equipment, control, private use of the equipment, the coverage and responsibility damages and accidents of the teleworker or third parties that arise from use and misuse of the equipment and, last but not least, an exact description of the activities on which the salary is based. Further, German social security laws only protect teleworkers, if they are deemed to be employees as defined under German labor laws. If so, the employer is to pay one half of the social security contributions.

Finally, under German labor law, a specific form of employment relationship called Heimarbeiter (homworker) exists. It is protected under the German law on homeworkers (Heimarbeitergesetz). Under this law, freelancers, who regularly work for one commercial enterprise (Gewerbetreibender) and who are therefore economically dependent on this exclusive commercial enterprise, are deemed to be protected under specific German employment laws (arbeitnehmerahnliche Personen), such as the German law on minimum vacation time (Bundesurlaubsgesetz) and the law on labor courts (Arbeitsgerichtsgesetz). However, the German law against unfair dismissal (Kundigungsschutzgesetz) does not protect these employees.

Whether or not the relationship is an employment relationship protected under German labor law must be very carefully considered in any teleworking relationship. Otherwise, even after many years of service, a freelancer relationship may suddenly be deemed an employment relationship, with the effect that the employer will have to pay social security contributions to German authorities without having a right to reimbursement against the teleworker.

For further information please contact Dr. Stefan Lingemann, Dr. Burkard Gopfert, Liliane Corzo, J.D., Gleiss Lutz Hootz Hirsch, Friedrichstrasse 71, 10117 Berlin, Germany, e-mail: Click Contact Link , Fax: +49/30/209464-44

This article is correct to the best of our knowledge as at the time of its publication. However, it is written as a general guide. Therefore specialist advice should be sought as regards your specific circumstances.