What yesterday's EU court ruling means for the games industry

Game companies should take appropriate action now to avoid legal trouble after yesterday's European Court of Justice (ECJ) ruling.

That's according to Sebastian Schwiddessen and Dr. Matthias Koehler from international law firm Baker McKenzie, which regularly advises companies from the video game and creative industries on media, IT and employment-related matters.

Yesterday the ECJ ruled that employers in Europe must set up a system to track the daily working hours of their staff. The decision is an effort to crack down on unrecorded overtime and properly enforce the EU Working Time Directive, which restricts employers from making staff work more than 48 hours a week, and grants at least 11 consecutive hours of rest every 24 hours.

With the seemingly unending problem of crunch in the games industry, this ruling could theoretically help protect developers from exploitative management practices.

Crunch in the industry is both a cultural and legal issue. While the EU Working Time Directive technically protects developers from being overworked, there are currently no means of enforcing it.

Employees are able to opt-out of the directive, but it has to be done so voluntarily and in writing. Furthermore, employees are free to opt back in without restriction, and are able to cancel their opt-out agreement even if it was part of their employment contract. However, stories from studios that battle crunch indicate it's often a problem with culture, the unspoken social contract, and woeful management.

With no means of enforcing the EU Working Time Directive, developers who are overworked often don't formerly opt-out; they just work the extra hours. However, with the working days being tracked and reported, it becomes harder to simply put pressure on people to waive their rights. Formalising the process is intended to take it out of the shadows, and discourage the practice of crunch because everyone would have to agree first in writing, or the company would find itself in severe legal trouble.

"Financially, the ruling may result in an increased enforcement of overtime pay," Schwiddessen told GamesIndustry.biz. "At present, claims for compensation of overtime work are often rejected due to the fact that employees bear the burden of proof that overtime work has in fact been performed. With the introduction of a recording obligation, such proof would no longer be a problem."

While there is no set timeline for the EU Member States to follow, the German Secretary for Labour is expected to enforce the ruling for Germany on January 1, 2020. Pressure from labour unions across the EU could also ensure a "swift implementation of the new rules."

"Thus, the new ruling makes the ongoing efforts of unionisation in the video gaming industry that we are currently seeing in various countries such as the UK and Germany even more relevant for gaming companies," he added.

With the advent of more flexible working conditions in the digital age, certain restrictions such as the 11 hours of consecutive rest don't necessarily meet the needs of modern working people. According to Schwiddessen and Koehler, the ruling provides an opportunity for EU Member States to "modernise their often outdated working time acts."

"Member States will be given discretion as to the form of an objective, reliable and accessible system enabling the recording of the duration of time worked each day by each worker," said Koehler. "The pertaining national provisions shall in particular take account of the specific characteristics of a given sector of activity, or the specific characteristics of a given enterprise, including its size."

However, critics of the ruling have raised concern of the heavy administrative burden placed on employers to document working hours. Others have suggested that it unjustifiably interferes with employees' right to privacy when working from home, but both complaints were rejected by the ECJ.

For the record: This article previously stated that prison sentences could be handed out for failure to adhere to the ruling after it is implemented. While this is theoretically possible, it's currently unlikely according to experts.