Teleworking in Monaco: who, what, where and how?

Teleworking is gaining ground in Monaco. In 2016, 38,200 employees residing in France and around 4,000 employees residing in Italy were involved, representing almost 83% of employees in Monaco's private sector*. According to estimates by the Monegasque authorities, in the short term between 500 and 5,000 employees could actually telework for companies established in the Principality (between 1 and 10% of all employees). In the medium term, teleworking could account for between 7,000 and 10,000 jobs** (between 18% and 26%, i.e. in line with the European average***). A small revolution. Everyone's talking about it, but what exactly does it involve?

Contents

• What are the reference texts?

• What is teleworking?

• How can it be set up?

• What are the essential rules of teleworking?

* Statistics IMSEE Monaco : Emplois du secteur privé, Focus N°45, 04/2016, Figures at 31/12/2015.

** Stéphane Valeri, Conseiller aux Affaires Sociales, Monaco Hebdo, n° 921, 16/04/2015, p. 32.

*** Teleworkers account for 17% of employees in France, compared with between 20% and 35% in Anglo-Saxon and Scandinavian countries. [Report on Bill 926 on teleworking, Commission des Intérêts sociaux et des Affaires Diverses (CISAD), 10/06/2016, p. 2].

* * *

I. Reference texts on teleworking in Monaco

The impetus to introduce teleworking in Monaco was given by the Conseil Économique et Social (Economic and Social Council) in 2007[1].

► Why was Law n° 735 of 16/05/1963 establishing the status of homeworking unsuitable for teleworking?

Teleworking is "not necessarily carried out at home". And it presents other specific features from the point of view of "the organisation of the teleworker's relationship with the company or the respective rights and obligations" of the employee and the employer: terms and conditions of performance, working hours, terms and conditions of remuneration, equipment made available, health and safety protection, for example.[2]

► What does Law no. 1.429 of 04/07/2016 determine?

Law no. 1.429 lays down the general rules on teleworking[3], and amends laws no. 629 of 17/07/1957[4] and no. 1.144 of 26/07/1991[5] :

• Scope (art. 1, para. 1)
• Definition of teleworking (art. 1, par. 2)
• Methods of implementation (art. 1, para. 3)
• Cases of exclusion from the scope of teleworking (art. 1, para. 4)
• Hypotheses for the introduction of teleworking (art. 2)
• Formal conditions - employment contract (art. 3)
• Prior and reporting obligations - collective situation (art. 4)
• Declarative obligations - individual situation (art. 5)
• Conditions of reversibility (art. 6)
• Equality of treatment and rights between teleworkers and other employees (art. 7, para. 1 and art. 8)
• Counting - storage and communication of data (Art. 7, paras. 2 and 3)
• Specific obligations of the employer towards the teleworker (Art. 9)
• Insertions to Law no. 1.144 of 26/07/1991 as amended and to Law no. 629 of 17/07/1957 (art. 11)
• Criminal liability of the employer (art. 12)
• Public policy - Nullity of contractual stipulations to the contrary (art. 13)

► What does Ministerial Order no. 2016-425 of 01/07/2016 determine?

Ministerial Order no. 2016-425 applies Articles 3 and 4 of Law no. 1.429, and provides for criminal penalties in the event of infringements[6]:

• Mandatory information in contractual clauses - conditions for teleworking (art. 1)
• Mandatory information in the declaration - general terms and conditions of teleworking within the company (art. 2).

► In the case of transnational teleworking, what does the International Convention on Social Security determine?

The bilateral social security Convention determines which social security legislation is applicable to employees teleworking for companies established in one of the two States, from the territory of the partner State.

The affiliation of teleworkers alternating between Monaco and France is regulated by article 1 of Avenant no. 6 to the Convention of 28/02/1952 between the Principality of Monaco and France on social security[7] :

• Principle: employees are subject to the legislation of the place of work (art. 3, § 1 of the MC-FR Convention).
• New exception (Avenant no. 6): salaried teleworkers who work at least one third of their weekly working time on the employer's premises are subject to the social security legislation of the State where the employer has its registered office or domicile (art. 3, § 2, new f of the MC-FR Convention).

Negotiations have been taking place with Italy since 2015 to conclude an agreement based on the same model, amending the General Convention on Social Security of 12/02/1982 between the Principality of Monaco and the Italian Republic[8]. On 10 May 2021, the two countries signed Avenant no. 1 to the said Convention relating to the introduction of teleworking, which came into force on 1 June 2024, the date of its entry into force for the Principality of Monaco by Sovereign Order no. 10.558 of 16 May 2024 (JDM no. 8696 of 24 May 2024):

• Principle: employees are subject to the legislation of the country where they work (art. 4, § 1 MC-IT Convention)
• New exception (Avenant no. 1): employees who work at least one third of their working week on the employer's premises are subject to the social security legislation of the State where the employer has its registered office or domicile (art. 4 § 2, new f) MC-IT Convention).

II. Teleworking under Monegasque law

► Employee teleworking on a voluntary basis

Teleworking is intended exclusively for "employees, bound to their employer by an employment contract governed by Law no. 729 of 16/03/1963, as amended"[9] who use "information technologies"[10] (computers, telecommunications) to work remotely.

Teleworking is voluntary, both for the employee and the employer. Either it is part of the conditions of employment for the employee, who accepts the rules and terms of the employment contract, including those relating to teleworking. Or it is introduced during the performance of an employment contract by express agreement of both parties, the consent having to be freely expressed.[11]

If the request to telework comes from the employer, the employee's agreement is therefore imperative. The employee's refusal to agree to carry out part of his or her work by teleworking is not a valid reason for terminating the employment contract[12]. By extension, this refusal must not constitute grounds for disciplinary action either. Conversely, the employer may accept or refuse an employee's request to telework in the future[13].

When teleworking has "already been contractually agreed between an employer and some or most of its employees, no obligation to agree to telework arises for the other employees, any more than an obligation arises for the employer to allow all its employees to use it"[14].

► Regular alternating teleworking

The "work, which could also have been carried out on the employer's premises, is carried out partly outside these premises on a regular basis"[15].

The only form of telework accepted by Monegasque law is regular teleworking, i.e. a usual form of organisation for the employee.

In other words, occasional teleworking is excluded. Teleworking in the Principality is not intended to respond to unusual or emergency situations, and cannot therefore be used on an episodic basis. Thus, for example, an employee who occasionally carries out his or her professional activity from home, with the agreement of his or her hierarchy, cannot under any circumstances be granted the status of teleworker.

The teleworking activity must alternate with periods worked within the company, and "may not occupy more than two-thirds of the employee's working time"[16]. The calculation is based on a working week[17]. This excludes alternating weeks (week entirely teleworked/week entirely on site).

The threshold of two-thirds of working time (26 hours a week) is designed to achieve "great flexibility". It is "high" given that "in the majority of cases observed, the reality is rather between a quarter and a third, or one and a half days a week"[18].

The part of the employee's activity that is not in the form of teleworking must be carried out on Monegasque territory[19], on the employer's premises, which implies that the company "has a suitable structure to accommodate the teleworker". This requirement is aimed at "maintaining the link between the teleworker and the company"[20].

The teleworking part of the employees' activity may be carried out on Monegasque territory and on the territory of a country which has concluded an international social security agreement with Monaco providing for the maintenance, in favour of the teleworker, of the application of the Monegasque social security system[21], i.e. France and Italy.

The teleworking activity may be carried out at a single location, in principle at the employee's home or at a telecentre[22] close to his or her home, or even "alternately at several locations, whether the employee's main residence and second home, or the main residence and a telecentre, for example". These places "may be located in the same territory or in different territories"[23].

Work carried out in "premises decentralised by the employer or made available to staff by the employer cannot be considered as teleworking"[24].

III. Setting up teleworking

► The employer's obligation to provide information

The employer's initial approach in its relations with staff delegates[25] has been simplified compared to what was originally envisaged by the bill: "the start of the teleworking activity is first and foremost a direct agreement between an employer and an employee, materialised by an individual contract (be it a standard contract)", and "overly burdensome start-up constraints" could have been off-putting.[26]

Staff representatives must be informed in advance by the employer of the general arrangements for carrying out the teleworking activity it is planning within the company. They must be able to assess compliance with the provisions of Law no. 1.429.[27]

A dialogue within the company, which the law does not require, can be spontaneously set up by the parties, "whether it takes place from the start or a little later, when the feedback from the first individual experiences in the company will lead to considering that teleworking really becomes a company project"[28].

► The employer's reporting obligations

On the one hand, the employer must systematically submit[29] to the Director of Labour the general terms and conditions for carrying out teleworking that it has adopted for its business, "which include in particular, the mandatory contractual stipulations" provided for in art. 1 of Ministerial Order no. 2016-425 of 01/07/2016[30].[30]. Their legal compliance is verified within two months[31]. Art. 2 of the Ministerial Order lists the compulsory details of the declaration:

• Identity of the employer;

• Employer's address;

• Type(s) of teleworking location(s) and address(es);

• Conditions of eligibility for teleworking;

• Arrangements for teleworking within the company ((arrangements for prior determination of the days on which work is carried out in the form of teleworking/on the employer's premises - Organisation of working time: calculation of days and hours worked, verification arrangements, etc.).

On the other hand, the employer must declare the individual teleworking situation to the Direction du Travail (Labour Department) via the application for a work permit or its modification (employees of foreign nationality) or the declaration of recruitment or its modification (employees of Monegasque nationality)[32], depending on whether teleworking is provided for at the time of recruitment or is introduced during the performance of the employment contract.

This census of companies and employees concerned by teleworking will enable officials from the Direction du Travail (Labour Department), the Direction du Développement Économique (Economic Development Department) and the Caisses Sociales de Monaco (Social Security Funds of Monaco) to monitor the effectiveness of this activity in the Principality. Personal data must be processed in accordance with Law no. 1.165 of 23/12/1993, as amended, on personal data protection.[33]

► Formalising the conditions under which teleworking is carried out

In the case of recruitment, the "conditions for teleworking are stipulated in writing in the body of the employment contract". If they are introduced during the term of the employment contract, they "shall be the subject of a written amendment to the employment contract". Art. 1 of Ministerial Order no. 2016-425 of 01/07/2016 lists the compulsory terms of contractual clauses:[34]

• Places where teleworking is carried out;

• Determination of the applicable national law;

• Arrangements for carrying out teleworking (arrangements for prior determination of the days on which work is carried out in the form of teleworking/on the employer's premises - organisation of working time: counting, verification...);

• Health and social security protection (workstation ergonomics, etc.);

• Arrangements for the supply, installation and maintenance of the equipment required for teleworking;

• Terms and conditions of compensation for the occupation of the employee's home;

• Arrangements for paying for insurance covering the risks associated with teleworking;

• Conditions of reversibility (when teleworking is introduced during the performance of the employment contract).

IV. The essential rules of teleworking

► Double reversibility in the event of a move towards teleworking

According to estimates, "in the Monegasque fabric made up of many small and medium-sized enterprises, telework will probably, in the first instance, be tested via an experiment offered to a limited number of employees". Initially, there should be "a lot of job changes before we move on to desirable job creation".[35]

Formalising teleworking in a rider to the employment contract will, at least in the short term, be the most frequent hypothesis.

A contractual clause will then have to mention "the conditions of reversibility of teleworking provided for in Article 6 of Law no. 1.429"36] : "the employer or the employee [double reversibility] may, by registered letter with return receipt requested, unilaterally terminate the amendment to the employment contract (...) within six months of its signature. The termination shall take effect one month after presentation of the registered letter".

The 6-month trial period was considered "sufficient to allow everyone to grasp the reality of this way of organising work"[37].

Apart from this right of unilateral termination, the employer and employee naturally retain the possibility, "at any time and by mutual agreement", of "modifying or terminating the teleworking arrangement", in accordance with the "rules of ordinary contract law"[38]

The end of the teleworking activity instituted during the performance of the employment contract obviously does not entail the end of the employment contract: "the employee then finds her/himself in a situation identical to that which was her/his prior to the conclusion of the rider"[39].

► Equal treatment of teleworkers and employees in comparable situations working exclusively on the employer's premises[40]

The employer must ensure equal treatment from the point of view of:

• the number of hours and days worked;

• workload;

• productivity standards;

• performance deadlines;

• performance criteria;

• collective rights;

• career opportunities;

• access to information and training.

The employer, who is "obliged to count the working days and working hours"[41] of teleworking employees, is ""free to choose the means it considers most reliable and appropriate"[42].

Law no. 1.429 does not require that the technology used to carry out teleworking should allow for counting. Monitoring could therefore be carried out via an automatic recording system, or a system based on manual recording, or even a self-reporting system.

The employer must keep the data collected "for a period of five years", which is the statutory limitation period for wage claims, and provide it to the Inspection du Travail (Labour Inspectorate) on request.[43].

► The employer's specific obligations towards the teleworker (in addition to the general obligations towards his employees44]

The employer must:

• cover the costs directly incurred by the teleworking activity (hardware, software, subscriptions, communications, tools and their maintenance);

• provide information on the restrictions on the use of computer equipment/tools, electronic communication services and on the penalties incurred in the event of non-compliance;

• give priority to teleworkers who wish to take up or return to a non-teleworking post that matches their professional qualifications and skills, and inform them of the availability of any such post;

• organise an annual interview to discuss the teleworker's working conditions;

• respect the teleworker's private life, and to this end set, in consultation with the teleworker, the time slots during which he/she may be contacted;

• take appropriate measures to ensure the protection of data used and processed for professional purposes by the teleworker.

One of the main difficulties of teleworking is that it blurs the boundary between private and professional life. A clear distinction needs to be made between working hours and hours of availability, during which teleworking employees must be contactable.

IT security is another point to watch out for: data protection and confidentiality clauses, an IT charter, information for teleworkers on legislation and rules concerning the protection of data used and processed for professional purposes. "Generally speaking, the employer, like the administrative departments [...], must ensure compliance with the provisions of Law no. 1.165 of 23 December 1993 on personal data protection"[45].

Finally, it should be noted that any contractual stipulation contrary to the provisions of Law no. 1.429, which is of public order, is automatically null and void. [46]

* * *