Reimbursement of teleworking expenses: the Court says ‘no’

Here is the update on Court case T-486/21 promised in our article on whether working from home can truly be considered voluntary. We noted there that the Court rejected the application made by one of our colleagues for reimbursement of teleworking-related internet and phone costs incurred during the COVID-19 pandemic (judgment 07/09/2022). We’ve been raising the issue of additional teleworking costs for over 2 years now and even though all OSPs succeeded in having this issue explicitly mentioned in the  Commission Decision of 24/03/2022 on working time and hybrid working (Article 13) we see the Commission is increasingly reluctant to act.

General remarks

Very unusually, both the Council and the Parliament intervened in support of the Commission; normally, they do not do that unless there is a real and common danger. Why did the EU co-legislators and budgetary authorities deem it necessary to intervene in an individual case against the Commission that would seem rather insignificant? To put this in context, the Parliament has given a monthly lump sum to its staff since April 2020 [1] while the Council asked the Commission to further reduce its costs related to staff in July 2022. Perhaps here the Council and the Parliament were afraid of a Court judgment acknowledging a general right to reimbursement of teleworking expenses and thus creating a dangerous precedent that could have considerable implications for the administrative budget of the EU institutions that is already under pressure. 

Context and timeline

  • March 2020 generalised teleworking due to Covid confinement
  • April 2020 European Parliament starts to pay its staff a monthly lump sum
  • December 2020 our colleague submitted an Article 90(1) request for payment of additional costs due to working from home (calls and internet: EUR 51.89)
  • December 2020 the request for payment was denied
  • January 2021 our colleague appealed the decision
  • May 2021 the administration rejected the appeal based on Article 71 of the staff regulations (SR)

 

Claims of the applicant  

The applicant asked the Court:

  • principally, to declare that the 5 May 2021 decision to reject the appeal is unlawful;
  • alternatively, to annul the decision of 5 May 2021;
  • to order the European Commission to pay EUR 51.89 by way of compensation for professional expenses;
  • to order the European Commission to provide to the applicant an internet plan for professional use by whatever means and for any telework situation that may arise;
  • to order the European Commission to pay the applicant the sum of EUR 10 000 euros in respect of the damage suffered;
  • to order the European Commission to pay the costs.

In support of the action, the applicant relied on three pleas in law.

  1. Article 71 SR is unlawful and, alternatively, that the 5 May 2021 appeal rejection should be annulled on the ground that that decision is incompatible with the Article 71 case-law. In support of that plea, the applicant further alleges breach of the duty to have regard for the welfare of officials and of the duty of sound administration, and that the decision to reject the appeal is discriminatory.
  2. in support of the application for an internet plan for professional use, alleging infringement of Article 7 of the Charter of Fundamental Rights of the European Union.

‘Respect for private and family life:  Everyone has the right to respect for his or her private and family life, home and communications.’

  1. in support of the claim for compensation for the damage suffered, alleging that the unlawfulness of the Commission’s conduct gives rise to non-contractual liability on the part of the European Union.

Unfortunately, the Court rejected all claims of the applicant, dismissed the action, ordered the applicant to bear their own costs and to pay those incurred by the European Commission.

Arguments of the Commission

Article 71 and Annex VII SR do not provide for reimbursement of teleworking costs

The Commission claimed that the teleworker should bear the costs of any internet subscription and communication entailed by teleworking and that the right to reimbursement of business expenses (Article 71 SR), exercised under Annex VII SR, does not mention those costs.

The Court noted that, although the objective of Article 71 is indeed to prevent officials from bearing alone the costs incurred in the performance of their duties (judgment of 18 November 2015, FH v Parliament, F-26/15, EU:F:2015:137, paragraph 32), it is under the conditions set out in Annex VII that reimbursement of costs is due. However, Annex VII does not list internet or teleworking costs as reimbursable financial benefits. For that reason, the Commission decision rejecting the complaint could legitimately be based on the fact and any EU law which gives entitlement to financial benefits must be interpreted strictly (see judgment of 18 July 2017, Commission v RN, T-695/16 P, not published, EU:T:2017:520, paragraph 54 and the case-law cited).

We must point out that the Court could have referred to Article 56c SR (‘Special allowances may be granted to certain officials to compensate for particularly arduous working conditions’) – even though this legal basis was not raised by the applicant – if the Court wanted to create case-law imposing an obligation on the institutions to reimburse staff for their teleworking costs.

Tax abatement for business costs

The Commission also raised the argument that certain officials of the European institutions receive financial support for the business costs incurred by them by means of the tax relief provided for in Article 3(4) of Council Regulation No 260/68 (29.02.1968), which result in a reduction of 10% of the taxable amount for ‘occupational and personal expenses’.

The Court accepted the argument of the Commission, pointing out that ‘the EU legislature has already taken account of the situation of certain officials, including the applicant, by allowing them to benefit from the 10 % tax reduction to cover business expenses, which is provided for in Article 3(4) of Regulation No 260/68’.

We must point out that, although there is indeed a tax abatement under Article 3(4) of Regulation No 260/68 intended to cover bushiness expenses, this tax abatement seems to be not proportionate to the real expenses incurred by staff due to teleworking.  

Duty of care towards staff

The Court agreed with the Commission that it is apparent from the Guidelines on teleworking that the Commission opted to reimburse certain office equipment costs in order for its staff to benefit from working conditions as per health and safety standards equivalent to those of an office, which is clearly an expression of care.

However, we have to point out that the Commission must provide its staff members for the purposes of teleworking with not only a chair and a screen but also with an internet connection and a corporate phone.  We also remind you that non-permanent staff have to repay part of the Commission contribution to the costs of a screen and/or chair.

Therefore, we urge DG HR to adopt as soon as possible a decision providing for a lump sum covering certain costs of teleworking staff, as provided for in Article 13, paragraph 4 of the Commission Decision of 24/03/2022 on working time and hybrid working.

For any other questions, do not hesitate to get in touch or leave a comment below.

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[1] Generation 2004 requested that the Commission do the same (ANNEX).

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