Collective Agreement for the Hotel, Restaurant and Leisure Industry for 1 February 2017

COLLECTIVE AGREEMENT FOR THE HOTEL, RESTAURANT AND LEISURE INDUSTRY FOR 1 FEBRUARY 2017–31 JANUARY 2018

The Collective Agreements (for employees and supervisors) governing the hotel, restaurant and leisure industry have been renewed for the period from 1 February 2017 to 31 January 2018 in accordance with the Competitiveness Pact signed by the labour market confederations. The agreement period does not include any pay increases. Conversely, working hours provisions have been revised significantly.

The changes concerning working hours and the system of JP days off (public and Church holidays) will enter into force already on 1 January 2017, i.e. at the very beginning of the calendar year. In other respects, amendments will enter into at the beginning of the new agreement period on 1 February 2017.

The most essential changes and amendments are explained below. The amendments and changes apply to Collective Agreements governing both employees and supervisors.

1.Changes to maximum regular working hours as from 1 January 2017

The maximum regular working hours will increase in accordance with the Competitiveness Pact. The periodical working hours will increase from the current 111 hours to 112.5 hours in three weeks and the system of JP days off will be completely replaced with a new Annual Days Off system. The monthly pay divisors will remain unchanged.

A.Maximum regular working hours

The regular working hours determined by the Collective Agreement will increase from 111 hours to 112.5 hours in a three-week period as from 1 January 2017. The monthly pay for full-time employees will remain unchanged even though the working hours are increased.

The increase in working hours shall be effected by means of drafting the roster to correspond the new working hours regulations from 1 January 2017 onwards. In practice, the roster is drafted according to the new rules from the beginning of the first three-week period that begins after 1 January 2017. Effecting the changes in working hours requires neither negotiations with the employees nor renewal of existing employment contracts. However, it is recommended that the employer informs its employees before the changes take effect that the working hours are going to be increased as prescribed by the amended Collective Agreement.

The definition of a part-time employee will change in accordance with the increase in working hours, i.e. an employee is a part-time employee if their working hours amount to less than an average of 112.5 hours in a three-week period.

B.Working hours adjustment systems

The increase in working hours will lead to changes to the working hours adjustment systems. In the so-called 18-week adjustment system (Collective Agreement Clause 12.1) the target amount of working hours will be 6 × 112.5 hours i.e. in total of 675 hours in the adjustment period. Respectively, in the 27-week adjustment system (Clause 12.2) the amounts will increase correspondingly, i.e. 9 × 112.5 hours equalling to a total of 1,012.5 hours.

In the working hours adjustment systems the effect of absences will, in the future, be taken into account by equating absences as worked hours in the following manner where no roster has been drawn up: 7.5 hours per day (previously 7.4 hours) and 37.5 hours per working week (previously 37 hours).

In the 18-week adjustment system the maximum amount of working hours over a single three-week period will increase from 129 hours to 130 hours and in the 27-week adjustment system from 135 hours to 136 hours (Collective Agreement, Clauses 12.1.3 and 12.2.3). Within the Annual Working Hours System the maximum amount will remain unchanged at 150 hours (Clause 12.3.2.1).

The compensation of additional and overtime work exceeding the maximum amount of working hours of a single three-week period within the adjustment systems will change as follows: within the so-called 18-week system work in excess of 130 hours will be compensated in the following manner:

7.5 hours with normal hourly pay (previously 9 hours);
the next 18 hours with a 50% increase; and
any subsequent hours with a 100% increase in pay.

Correspondingly, remuneration for any surplus hours at the end of an adjustment period will be compensated as follows:

7.5 hours with normal hourly pay (previously 9 hours);
the next 18 hours with a 50% increase; and
any subsequent hours with a 100% increase in pay.

Corresponding changes will also apply to the working hours adjustment system based on local agreements (the so-called 27-week adjustment system, Clause 12.2.). In the future, period-specific additional and overtime work will only be compensated for any hours in excess of 136 hours (previously 135 hours).

Corresponding changes arising from the increase in working hours will also be made to the Annual Working Hours System under Collective Agreement Clause 12.3, i.e. any working hours exceeding or falling below 112.5 hours can be transferred to the system. In terms of granting days off, the length of a day off will be 7.5 hours instead of the former 7.4 hours. A corresponding amendment will also be made to the provision governing compensation for surplus hours.

The maximum working hours of monthly paid employees doing regular night work as per Collective Agreement Clause 12.4 will remain unchanged (90 hours in a three week period). For these employees, the increase in working hours will be implemented through the new Annual Days Off system.

In uninterrupted three-shift work under Collective Agreement Clause 12.5, regular working hours will increase from 105 hours to 106.5 hours. In this system, additional work refers to work done in excess of 106.5 hours and up to 120 hours within a three-week period. However, employees falling within this working hours scheme will not earn any Annual Days Off.

C.Provisions governing additional and overtime work and the shortening impact of annual holidays

The overtime limit of 120 hours over a period of three weeks will remain unchanged, as will compensation payable for overtime work.

As the maximum amount of regular working hours increases while the overtime limit remains unchanged, a monthly paid employee may accumulate additional work only 7.5 hours during one single three-week period (previously 9 hours).

Having regard to the rules governing additional work on a partial three-week period, hours worked in excess of 7.5 hours (previously 7.4 hours) up to 8 hours will be compensated as additional work (Collective Agreement Clause 18.3.)

The shortening impact that annual holidays have on the working hours of a three-week period (Collective Agreement Clause 27.5.8) will similarly change to 7.5 hours per one annual holiday day and public or Church holiday falling on a weekday from Monday through Friday during the period of annual holiday (previously 7.4 hours).

D.Working hours provisions governing clerical workers

The regular working hours under Clause 3 of the Protocol on Clerical Workers will increase from 37.5 hours to 38 hours. As a result, the provision governing increased pay will be amended such that, in the future, pay will only be increased by 50% for work in excess of 38 hours.

The maximum working hours per day and the current system of shortening working hours for weeks with public or Church holidays will remain unchanged within this working hours scheme, as will the monthly pay divisor.

The employer can still choose whether to apply this specific working hours scheme to clerical work or to organise working hours by applying the regulations regarding periodic work including the Annual Days Off and working hours adjustment systems.

The provisions regarding a situation where an employer transfers an employee to a new working hours system will remain unchanged. Accordingly, in such situations the employer shall inform the employees or their representative in good time before the change is made.

E.Transitional provisions concerning the change in working hours

As a general rule, amendments governing working hours will enter into force on 1 January 2017. Notwithstanding, the change will not be implemented in the middle of a three-week period running at the turn of the year, but only as from the beginning of the subsequent three-week period starting closest to 1 January 2017.

Considering the cycle of drawing up rosters, this means in practical terms that the change may become effective as from 2 January 2017, 9 January 2017 or 16 January 2017 at the earliest.

When calculating the target and maximum hours for the working hours adjustment system, the calculation will be based on 112.5 hours per three-week period as from the three-week period when it became possible to put the change into effect as described above.

Consequently, the target hours for an adjustment period of 6 × 3 weeks (18 weeks) ongoing at the turn of the year, for example, may amount to 4 × 111 hours + 2 × 112.5 hours, equalling 669 hours. Any possible surplus of working hours remaining at the end of the adjustment period will be compensated in accordance with the provisions effective on the end date.

F.Other changes to working hours

In terms of regular night work under Collective Agreement Clause 12.4, it will be possible, as per Clause 30, to agree locally with monthly paid full-time employees that their working hours will be adjusted to an average of 90 hours over two consecutive three-week periods (‘adjustment period’).

2.Expiration of the system of JP days off and the new Annual Days Off system

The current system of JP days off (public and Church holidays) will expire on 31 December 2016. The system will be replaced with a completely new Annual Days Off system, where the accrual of paid Annual Days Off (‘VV-days off’) will be based solely on the hours worked during a calendar year. Working during a week with a public or Church holiday will no longer be of any relevance. The Annual Days Off system will become effective on 1 January 2017.

The system requires monitoring of the amounts of actual hours worked by employees. As an obligation to monitor working hours is also included in a provision of the Working Hours Act governing the working hours register, the amendment will not significantly increase an employer’s administrative burden.

A.System coverage

The Annual Days Off system covers both full-time and part-time employees, as well as those doing regular night work according to Collective Agreement Clause 12.4 (the so-called 90-hour system), i.e. the same groups that previously fell within the system of JP days off.

However, in the working hours scheme regarding regular night work the accrual limit, number of VV-days off and the shortening impact of VV-days off differs from those applied to the normal working hours scheme. This is discussed in more detail below.

There is a two-month waiting period at the beginning of employment, which means that a newly recruited employee will join the Annual Days Off system only after the employment relationship has lasted for two months. Working hours counting towards the entitlement of VV-days off will only start to accrue after this waiting period.

Example: An employee’s employment relationship has started no later than 1 November 2016. Working hours counting towards entitlement of VV-days off will start to accrue as from 1 January 2017.

Example: An employee’s employment relationship has started on 21 November 2016. The two-month waiting period will expire on 20 January 2017. Working hours counting towards entitlement of VV-days off will start to accrue as from 21 January 2017.

Example: An employee’s employment relationship starts on 9 January 2017. The two-month waiting period will expire on 8 March 2017. Working hours counting towards entitlement of VV-days off will start to accrue as from 9 March 2017.

Example: An employee has worked as a fixed-term summer worker for a period from 5 June 2017 to 30 July 2017. Due to the two-month waiting period applied at the beginning of employment, the employee has not transferred to the Annual Days Off system.

The employee starts working for the same employer on an indefinitely valid employment contract on 9 October 2017. Working hours counting towards entitlement of VV-days off will start to accrue after the two-month waiting period, i.e. as from 9 December 2017.

The Annual Days Off system will not cover employees doing work comparable to three-shift work as per Collective Agreement Clause 12.5 (the so-called 106.5-hour system in the future). Similarly, the previous system of JP days off was not applied to this working hours scheme.

B.Accrual of VV-days off

B.1.Accrual in the normal working hours scheme

The Annual Days Off system is based on the hours worked during a calendar year and an employee may earn up to seven (7) paid VV-days off during one single calendar year.

VV-days off accrue such that an employee will earn one VV-days off for each actual full 220 hours of work. All actual hours worked will be taken into account, including additional and overtime hours. The accrual limit is the same for both full-time and part-time employees.

The system does not include absences counted as equivalent to working hours. Thus, the entitlement to VV-days off does not accrue from working hours coinciding with sick leave, annual holidays, or some other paid or unpaid period of absence. The only exception is the period of release from work granted to shop stewards and health and safety (H&S) representatives, which is counted towards hours worked for the purpose of accruing VV-days off entitlement.

VV-days off are earned in full days and any possible amount exceeding the number of working hours entitling to the last full VV-day off will neither be carried over to the subsequent calendar year, nor is the surplus compensated at the end of employment.

At the turn of the calendar year, accrual of VV-days off entitlement will always restart at zero.

B.2.Accrual in regular night work as per Collective Agreement Clause 12.4

In the working hours system applied to regular night work (the so-called 90-hour system), the accrual limit is lower, i.e. 210 hours, due to the shorter maximum working hours and employees can earn up to six (6) VV-days off during one year. In other respects, the above will apply to accrual.

C.Granting VV-days off

As a general rule, granting and compensating for VV-days off will follow the same principles as those applied to the currently effective system of JP days off. The same procedure also applies to work done on a VV-day off marked on the roster.

VV-days off can be granted when the accrual limit for each VV-days off (220 hours in the normal working hours scheme) is reached. However, VV-days off must be granted no later than by the end of the calendar year following the year of accrual, at the time determined by the employer. Employees must be consulted when granting VV-days off. The days off are marked on the roster with the abbreviation ‘VV’.

As a general rule, full-time (monthly paid) employees are receive VV-days off as actual paid days off. However, on the employee’s initiative, it is also possible to agree that a VV-day off will be granted in the form of reduced working hours or by compensating the day off with a monetary payment equivalent to basic pay for 7.5 hours. Such an agreement based on the employee’s initiative must be made separately for each earned VV-day off.

Part-time employees may either receive VV-days off as actual paid days off, or in form of monetary compensation equivalent to their basic pay for 7.5 hours, on the pay day following accrual of the VV-day off in question.

VV-days off marked on the roster will not reduce any other days off earned or to be earned, which means that they are equivalent to working days in terms of accruing weekly rest days (‘V-days’) and additional days off (‘X-days’).

Example: An employee working five days per week is given two VV-days off in a specific week. In addition to these VV-days off, it is possible to schedule three working days, a V-day and an X-day for the same week.

If an employee is working on a VV-day off marked on the roster, they will receive their basic pay with an increase of 50% for that day. Any hours worked on a VV-day off will not be taken into account when calculating the total working hours for the period.

At the end of employment, any VV-day off earned but not granted will be paid out in money at normal pay. The monetary payment amounts to basic pay for 7.5 hours per each VV-day off.

Shop stewards and H&S representatives fully released from work will agree with the employer on the dates when they will take their VV-days off, unless they have agreed on a procedure where personnel representatives are independently responsible for taking their VV-days off in due time.

D.Shortening impact of VV-days off on the periodic working hours

The shortening impact of one single VV-day off on the working hours of a three-week period is always 7.5 hours for both full-time and part-time employees. As a result, the current, laborious practice of calculating the average working hours of a part-time employee over three three-week periods in order to determine the length of a day off, will no longer be necessary.

By way of derogation, however, the shortening impact of a VV-day off on the period-specific working hours of those doing regular night work (Collective Agreement Clause 12.4, so-called 90-hour system) is five (5) hours.