Germany: Data protection amendments come into force

A number of important amendments to Germany's Federal Data Protection Act came into force on 1 September (MAJ 2009/14). From now on companies will be required to notify the appropriate data protection authority whenever there is a comprehensive breach of sensitive, confidential, financial, customer or criminal data. For certain serious breaches it is also necessary to publish a public notice in the press.

The revised law lists a number of matters that must be included in contracts between companies and external data processors. These include the security safeguards that will be applied, subcontracting rights and the return of storage media and its disposal.

Data on employees may now only be collected for decision-making purposes connected with the establishment, maintenance or termination of an employment relationship. If an employer wishes to collect personal data because of suspicion that a criminal offence may have been (or will be) committed it is necessary to have documentary evidence to back up the suspicion and the method of detection must be both appropriate and proportionate to the nature of the possible offence. It is also likely that the courts will apply such criteria when considering the legality of certain types of employee screening activity.

The penalties for violation of the Data Protection Act have also been increased from EUR 25,000 to EUR 50,000 per violation and from EUR 250,000 to EUR 300,000 for serious violations.

The EU Council has finally agreed to authorise the implementation of EU Regulation 883/2004 on the social security coverage of migrant workers.

This measure is now expected to come into effect on the March 1st 2010 and will not only simplify, but also make more cost-efficient the current provisions relating to migrant workers (EU Regulation 1408/71).

The new regulation will extend the period of time from 12 months to 24 months that an employee who has been posted to work in another country may pay social security to their country of residence (home country) so long as their employer conducts a substantial part of their business in the sending country. Further to this, when employees work for the same employer in one or more countries in addition to their home country they will be required to spend a 'substantial' period, being at least 25 percent of their time (or salary receipts), in their home country to continue paying social security contributions to their home country.

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