PRIVATE INTERNATIONAL LAWIndividual Employment Contracts in Rome I convetion(Article 8)TAYFUN IRMAK10/12/2012
WHAT IS INSIDE OF THIS PRESENTATION? What is the individual employment contract? What is the individual employment contract inRome I convention? Consequences of Article 8 of Rome I convention
A. WHAT IS THE INDIVIDUAL EMPLOYMENTCONTRACT? Basically employment contract is this :‘The contracts are established between employeewho is carrying out the job and employer who ispaying the salary for labor.’ The contract exists as a result of bargaining andconsensus of employee and employer.
Some contracts definitions in different countries:o in Turkish labour act:‘Employment contract is an agreement whereby one party (theemployee) undertakes to perform work in subordination to theother party (the employer) who undertakes to pay himremuneration’ in Slovenia ERA:‘Employment relationship is entered into by employment contract.(2) Therights and obligations related to the performance of work in the frameworkof the employment relationship and the registration to social insuranceschemes shall begin to be exercised on the day of commencement of workagreed in the employment contract…’ in Swiss labour act:‘An employment contract exists once two people reach anagreement according to which one person will carry out work inreturn for a salary from the other.’
1) WHAT MAKES THE CONTRACT AN EMPLOYMENTCONTRACT? Basically we need three elements to makeemployment contract; Worker to carry out the job Employer To pay salary for labor Consensus to exist contract
2) WHAT SHOULD THE EMPLOYMENTCONTRACT CONTAIN? data on the contracting parties including their residence or registered office date of commencement of work title of the position or type of work place where the work is to be carried out the duration of the employment contract and the manner of taking annualleave stipulation stating whether the employment contract is for part or full-timework stipulation on normal daily or weekly working time and the organisation ofworking time stipulation on other components of the workers wage, paymentperiod, payment day and manner of payment of the wage Stipulation terminating the contract
3) RIGHTS AND OBLIGAITONS IN THEEMPLOYMENT CONTRACT Carrying out Work: This obligation is for the workers. They must carry out thework under the employment contract’s stipulations. Obligation to Protect Business Secrets: A worker cannot reveal the businesssecrets. If he/she lets the secrets be known by other third persons, theemployee shall be liable of these consequences. Obligation of Remuneration: This obligation is for employers. They have to payto employees for their labor. Obligation to Provide Safe Working Conditions: This obligation is also for employers.And this includes safety and healthy working area, equipments which are appropriate touse them on the work and so on. Obligation to Protect the Workers Personality: Employers should respect and savethe employee’s personality. Keeping secret the worker’s personal information and beingrespectful to worker’s dignity are included in this obligation as well.
B. WHAT IS THE INDIVIDUAL EMPLOYMENTCONTRACT IN ROME I CONVENTION? Article 8 of Rome I Individual employment contracts 1. An individual employment contract shall be governed by the law chosen by the partiesin accordance with Article 3. Such a choice of law may not, however, have the result ofdepriving the employee of the protection afforded to him by provisions that cannot bederogated from by agreement under the law that, in the absence of choice, would havebeen applicable pursuant to paragraphs 2, 3 and 4 of this Article. 2. To the extent that the law applicable to the individual employment contract has notbeen chosen by the parties, the contract shall be governed by the law of the country inwhich or, failing that, from which the employee habitually carries out his work inperformance of the contract. The country where the work is habitually carried out shallnot be deemed to have changed if he is temporarily employed in another country. 3. Where the law applicable cannot be determined pursuant to paragraph 2, the contractshall be governed by the law of the country where the place of business through whichthe employee was engaged is situated. 4. Where it appears from the circumstances as a whole that the contract is more closelyconnected with a country other than that indicated in paragraphs 2 or 3, the law of thatother country shall apply.
The Rome I convention is all about the ‘Applicable law to contractual obligations in EU’ and the article8 is about the applicable law on employment contracts. The article 8 defines how can we make an employment contract (first intent of the article 8) andhow can we choose the applicable law for any conflict on the individual employment contract(second, third and fourth intents of the article 8). First paragraph of the article 8:‘An individual employment contract shall be governed by the law chosen by the parties in accordancewith Article 3. Such a choice of law may not, however, have the result of depriving the employee of theprotection afforded to him by provisions that cannot be derogated from by agreement under the lawthat, in the absence of choice, would have been applicable pursuant to paragraphs 2, 3 and 4 of thisArticle.’ First sentence of this provision is implicitly saying about how to make a contract. The provision refers to article 3 of the same convention. Article 3 is about the freedom of choice.According to this article; a contract shall be governed by the law chosen by the parties. It means theparties of the contract can decide to apply any law system on their relationship or their contract. And also, They can change the law any time during the contract with which law they want to applyto their relation. Even though the new law has different consequences than previous law; they canchoose the new one. But the choice shall not affect adversely rights of third parties. And the rest of the first paragraph protects the worker’s right , even if they don’t choose anapplicable law.
Second, third and fourth paragraph of the article 8 is about what if the applicable law wasn’tchosen by parties as in this article. Second paragraph of the art. 8:To the extent that the law -applicable to the individual employment contract- has not been chosen by theparties, the contract shall be governed by the law of the country in which or, failing that, from which theemployee habitually carries out his work in performance of the contract. The country where the work ishabitually carried out shall not be deemed to have changed if he is temporarily employed in anothercountry. Second paragraph is related which law will govern the contract absence of any chosen law. If theparties have not chosen an applicable law, there are two ways to find the governing law the contract;a) The law of country which the contract was established on its territorial. So, even if the parties don’tchoose any law to apply to their relation, where the consensus was ensured, its law will be applied.b) If to determine (a) option is not possible, in this case the habitual working place of the employee is thesolution source. Habitual working place means where is hosting for most part of the job. Such as, theemployee is working in an audit company. He is in the office which is placed in Maribor during 5 days of theweek. But the other 2 days, he is going abroad to audit the banks. So, the habitual working place is clearlyMaribor. It can be more complicated to define habitual working place, in this case we will decide to the lawof where is the connection is stronger with employee.
Third paragraph of the article 8;‘Where the law applicable cannot be determined pursuant to paragraph 2, the contract shallbe governed by the law of the country where the place of business through which theemployee was engaged is situated.’ It means, in the situations which could not be determined an applicable law according tosecond paragraph failing a chosen applicable law by the parties - for instance thecountry’s law can prohibit applying its law- the contract shall be governed by countrywhich is including the working place at the carrying out time.
Fourth paragraph of the article 8:‘‘ Where it appears from the circumstances as a whole that the contract is more closely connected witha country other than that indicated in paragraphs 2 or 3, the law of that other country shall apply.’’ According to this provision, if the situation shows that the contract is much closer to a country thanindicated countries in second and third paragraphs, the country’s law which is in more intimaterelation with contract govern the contract. The point of this paragraph is ‘ to prevent wrong implementation.’ How it will provide this ? If weapply the law which is belong to another country which is not related to job as musch as countrymentioned fourth paragraph - such as just contract was made in that country-, it can not providejustice because of the conditions of working place are totally different than the another countrywhich is related to job a little. Therefore, it is the more fair to apply closer county’s law.
C. CONSEQUENCES OF ARTICLE 8 OF ROME ICONVENTION There are some cardinal consequences of this article; This article provides the freedom of choice. It doesn’t order any law to be chosenor it doesn’t pressure to parties. But it has implied to choose an applicable law.Even they don’t, it regulates some other solutions and it defines an applicablelaw. It provides the equality by determining applicable law. It provides equality howadvising to choose a law. If they choose a law, employee’s and employer’s rightswill be under law’s control and all parties will know their all rights and obligations.A party cannot ask anything which is not placed in the contract/law. It directs the weak parties (employee) to ask their right. It provides a lawprotection and the employees think ‘okay, law back me up I can stand against toinjustices or exploiting by employer.’ And it provides justice.