On 1 August 2022, the Act Implementing the EU Directive on Transparent and Predictable Terms of Employment (Wtva) came into force. This law is the transposition of Directive (EU) 2019/1152, on transparent and predictable terms of employment in the European Union. The purpose of the Wtva is to provide more transparency and predictability. However, unfortunately, there are still a number of unclarities. In this contribution, we specifically highlight the prohibition on performing secondary activities under Art. 7:653a (1) of the Civil Code and how (legal) practice has dealt with it since its introduction.

Ban on secondary activities invalid, unless

Since 1 August 2022, a ban on performing secondary activities outside working hours is invalid unless such a ban can be justified on the basis of an objective reason (Art. 7:653a (1) of the Civil Code). In other words, an employer may no longer simply prohibit the performance of ancillary activities.

Meanwhile, a number of judgments have been published on this subject.

These deal in particular with the questions of when there is an objective reason and whether the new Section 7:653a (1) of the Civil Code will also have effect before 1 August 2022.

Objective reason

In the explanatory memorandum to the Act, examples of objective reasons have been mentioned, which may justify the prohibition on performing secondary activities. More specifically, health and safety, protection of confidentiality of business information, integrity of public services or avoidance of conflicts of interest are mentioned.

This is also widely used in published rulings. For example, the Zaanstad local authority had an objective reason for prohibiting the employee, active in the position of Supervisor Green, from performing landscaping work within its own municipal boundaries. This objective reason consisted of preventing (the appearance of) a conflict of interest. Because the employee was allowed to perform landscaping work outside the municipal boundaries, the prohibition was also appropriate, suitable and necessary, the court said.

Preventing harmful and/or competitive activities was also deemed an objective reason by the Haarlem subdistrict court for an employee in a management position.

The employer who initially tolerated the combination of playing in two orchestras, but later went back on it, also had an objective reason according to the court.

Indeed, combining these activities caused a violation of the Working Hours Act.

Preventing the employee from getting into the employer's commercial waters, with the real danger of damaging the company's business and (the appearance of) conflicts of interest, was also considered an objective reason by the Court of Appeal of The Hague.

In contrast, the Arnhem-Leeuwarden Court of Appeal ruled that the reasons put forward by the employer for the ban on secondary activities, namely limiting employability, not being able to perform the bus driver's job properly or at all, and harming health, were insufficiently demonstrated.

Effective before 1 August 2022?

Several rulings have ruled on whether Section 7:653a(1) of the Civil Code also affects events before 1 August 2022.

This section of the law has immediate effect and there is no transitional law.

A few employees already invoked Section 7:653a(1) of the Civil Code before the new law entered into force. For example, an employee argued that it would be unacceptable according to standards of reasonableness and fairness for him to forfeit the agreed fines due to breach of the secondary activities clause.

The Rotterdam subdistrict court did not go along with this.

On the one hand, because Section 7:653a (1) of the Civil Code had not yet entered into force. On the other, because the ancillary employment clause could be justified on the basis of an objective reason.

It is also interesting to see whether Section 7:653a (1) of the Civil Code can be invoked in case of violations of a secondary activities clause committed in the period before 1 August 2022.

It could be inferred from a judgment of the Arnhem Leeuwarden Court of Appeal that Section 7:653a (1) of the BW also applies to events before that date. Indeed, in assessing whether the employment contract was dissolved on the grounds of culpable conduct, the Court of Appeal did not make a clear distinction between the ancillary activities (renting out the camper van and running a car business) from before and after 1 August 2022.

In another case, the Court of Appeal of Arnhem- Leeuwarden did not reach a verdict on the question whether Section 7:653a (1) of the Civil Code applies to events before 1 August 2022, because in any case there was objective justification for the clause in question.

The Subdistrict Court of Rotterdam ruled that the employee who performed secondary activities during the last month of her temporary employment contract (April 2022) was not entitled to validly invoke Section 7:653a (1) of the Civil Code. Indeed, this section was not yet applicable law at the time, the Subdistrict Court said.

In another case, the Subdistrict Court of The Hague also ruled that Section 7:653a (1) of the Civil Code was not yet applicable law in the period (1 February 2019-1 May 2022) covered by the employer's claim.

Conclusion

The Act implementing the EU Directive on transparent and predictable terms of employment, aimed to provide employees with more transparency and predictability. However, with regard to the performance of secondary activities, it remains unpredictable for parties in advance whether there is an objective reason. It could be inferred from the first judgments on this matter that there is a broad interpretation. Furthermore, Section 7:653a (1) of the Civil Code does not seem to play a role in events before 1 August 2022, in the judgments published so far. However, transparency and especially predictability seem to be far away at the moment, as the interpretation still seems to depend heavily on the circumstances of the case and the judge's interpretation in a concrete case. It is therefore wise to seek the help of a specialised employment law lawyer when drafting or having such a clause reviewed. The employment law lawyers at SPEE advocaten & mediation will be happy to assist you.