British government defeated as EU court rules travelling to work 'is work'

Time spent by plumbers, decorators and carers driving to their first customer of the day counts towards the 48-hour working week, a European court has ruled, in a decision the government admits will drive up costs for businesses.

In a defeat for the British government, the European Court of Justice ruled that time spent by tradesmen travelling between their home and their clients is “work”.

The judgement amounts to a significant tightening of European labour rules, and could force thousands of British companies to hire more workers to remain in the law.

The ruling could also force companies to pay higher salaries to avoid breaking minimum wages laws, as well as giving employees more breaks, lawyers warned.

It comes as David Cameron has scaled back plans to regain Britain’s opt-out on the working time directive as part of his renegotiation with the European Union. The Telegraph has been told that Mr Cameron has stepped back from seeking a full opt-out over social legislation, and is now seeking a more modest declaration that employment law is a national competence.

Under the EU Working Time Directive, British employees cannot work more than 48 hours in a week unless they choose to opt out.

Under UK government guidelines, time spent travelling at work does count towards the target. But “normal travel to and from work” and “travelling outside normal working hours” does not.

The court ruling contradicts that. Judges in Luxembourg adjudicated in a case brought by workers at Tyco, a Spanish company that installs burglar alarms.

While workers drove for up to three hours to clients’ premises, the company counted their working day for the purposes of the directive from the moment they arrived at the first client to the moment they left the last one.

The court ruled that was wrong, and said travelling time counts as “work” for employees such as tradesmen who do not have a fixed office.

The judges dismissed arguments from British government lawyers that declaring travelling time as work could be abused by dishonest employees to carry out personal business, saying it was up to companies to prevent that.

They added that their judgement that travel time counts as work “cannot be called into question by the argument of the United Kingdom Government that it would lead to an inevitable increase in costs, in particular, for Tyco.”

Glenn Hayes, a partner at law firm Irwin Mitchell, said: “In certain industries, such as the care industry, it will have a huge impact.

“If you bid for a contract, and your costs go up, it could be potentially astronomical.”

Phil Allen, a partner in employment law at Weightmans said the ruling may “significantly increase” the amount of an employee’s day counted as work.

“Whilst this decision is not about the national minimum wage, which is not subject to European law and the wording of the Act is different, it may also have implications for what employees must be paid. There is often a degree of overlap between the way the two regimes are interpreted, so an impact on minimum or living wage cannot be discounted.”

The ruling provoked anger among business groups who argue European courts are too powerful.

Robert Oxley, Campaign Director of Business for Britain said: “'This is not a question of more or less protection for workers. It's a question of whether EU bureaucrats and judges control these matters or whether British voters and courts control them.”

Allie Renison, the head of trade policy at the Institute of Directors, said the European Court of Justice had “become a red-tape machine, tormenting firms across Europe.”

“The Working Time Directive needs to be reviewed, in order to resolve the lingering questions which are now being ruled on by the ECJ. Ensuring that employers do not have additional costs and burdens sprung upon them like this must be a core element of the Prime Minister’s renegotiation efforts.”

Anthea McIntyre, a Conservative MEP, said: “This could add significantly to the costs of businesses and interfere with long-established business practices. It could hit smaller firms particularly and that would be bad for growth and bad for jobs."

A spokesman for the Business Department said: “We are carefully considering the implications of this judgement”.