Due Dilligence

Purpose: This document outlines the mandatory legal and regulatory requirements that the Client must comply with when hiring employees through Megative Teams. The goal is to ensure full compliance with EU labor laws, data protection regulations (GDPR), and employment standards, while protecting Megative DE GmbH and its recruitment services.

1. General Compliance with EU and German Labor Laws
The Client must comply with all applicable European Union and German labor laws, particularly those concerning employee rights and working conditions, including:

1.1 Minimum Wage Compliance
- The Client must ensure that all employees are paid in accordance with the statutory minimum wage requirements applicable in the country of employment.
- Wages must also comply with relevant collective bargaining agreements, if applicable, ensuring that the employees’ pay is fair and meets all legal standards.

1.2 Working Hours and Rest Periods
- Compliance with the EU Working Time Directive (2003/88/EC) and relevant German law, including:
- Maximum working hours of 48 hours per week on average, including overtime.
- Employees must be given 11 consecutive hours of rest in every 24-hour period.
- Workers are entitled to a break of at least 20 minutes after six hours of work.
- A weekly rest period of at least 24 uninterrupted hours is mandatory.

1.3 Holiday Entitlements
- Employees must be entitled to the statutory minimum leave as per German law, which is generally 20 days per year for a five-day workweek, in addition to public holidays.

1.4 Non-Discrimination in Employment
- The Client must ensure compliance with Directive 2000/78/EC, which prohibits discrimination on the grounds of age, gender, race, religion, disability, and sexual orientation.
- Recruitment and employment practices must be transparent and non-discriminatory, ensuring equal treatment for all employees.

1.5 Health and Safety at Work
- The Client must provide a safe working environment in accordance with Directive 89/391/EEC and relevant German occupational safety laws. This includes:
- Conducting regular risk assessments and ensuring compliance with health and safety protocols.
- Providing necessary protective equipment and training to all employees.
- Ensuring that employees are covered by work-related injury insurance and other necessary occupational health insurance as required by law.

1.6 Social Security and Employee Benefits
- The Client must register all employees with the relevant social security authorities in the country of employment.
- This includes ensuring contributions to:
- Health insurance.
- Pension funds.
- Unemployment insurance, if required by local law.
- Work-related injury insurance as mandated by law.

1.7 Employment Contracts
- The Client must issue written employment contracts that comply with EU Directive 91/533/EEC and German labor law. Contracts must clearly outline:
- The employee’s job description, compensation, working hours, and responsibilities.
- The terms and conditions of employment, including start date, probation period, and notice periods.
- Compliance with any applicable collective agreements.

1.8 Temporary and Fixed-Term Employment
- If the Client hires workers on temporary or fixed-term contracts, they must comply with Directive 1999/70/EC. Temporary and fixed-term employees must not be treated less favorably than permanent employees unless objectively justified.

2. Data Protection and GDPR Compliance
The Client must ensure full compliance with the General Data Protection Regulation (GDPR) (Regulation (EU) 2016/679) when handling employee data. This includes:

2.1 Lawful Basis for Processing Data
- The Client must have a lawful basis for collecting, processing, and storing personal data, as outlined in Article 6 of the GDPR. This includes obtaining explicit consent from employees or processing data for the performance of a contract.

2.2 Data Security and Confidentiality
- The Client must implement appropriate technical and organizational measures to protect personal data from unauthorized access, loss, or disclosure. This includes ensuring the secure storage of employee data and limiting access to authorized personnel only.

2.3 Data Retention and Deletion
- Personal data must be retained only for as long as necessary for the fulfillment of legal and contractual obligations. The Client must have a process in place for deleting or anonymizing data once it is no longer needed.

2.4 Employee Data Rights
- Employees have the right to access, rectify, and erase their personal data, as well as the right to object to data processing. The Client must provide mechanisms to allow employees to exercise these rights in compliance with GDPR regulations.

2.5 International Data Transfers
- If the Client transfers employee data outside the European Economic Area (EEA), they must ensure that the transfer is compliant with GDPR standards, using mechanisms such as Standard Contractual Clauses (SCCs) or Binding Corporate Rules (BCRs).

3. Recruitment and Selection Practices

3.1 Fair and Transparent Recruitment
- The Client must ensure that recruitment and selection processes are fair, transparent, and non-discriminatory. All decisions must be based on the candidate’s qualifications and suitability for the role.

3.2 No Exploitation or Unethical Hiring

- The Client agrees to follow ethical recruitment practices, ensuring that employees are not misled about the nature of the role, compensation, or working conditions.
- The Client must avoid any form of exploitation or deceptive hiring practices that could harm the rights or well-being of employees.

4. Modern Slavery and Human Trafficking Compliance

4.1 Prohibition of Forced Labor and Human Trafficking
- The Client must ensure that they are in full compliance with EU Directive 2011/36/EU on Preventing and Combating Human Trafficking and other relevant national legislation. The Client shall not engage in or allow any form of modern slavery, forced labor, or human trafficking within their operations.
- All employees must be hired voluntarily and with full consent, without any form of coercion, deception, or exploitation.

4.2 Monitoring and Due Diligence in Supply Chains
- The Client is responsible for conducting due diligence in their supply chains to prevent any risk of modern slavery or forced labor. This includes monitoring suppliers, subcontractors, and any related third parties to ensure compliance with modern slavery laws.
- The Client agrees to immediately report any suspected or actual instances of forced labor or human trafficking to the relevant authorities and take corrective measures.

4.3 Employee Rights and Awareness
- The Client must inform all employees of their rights, particularly their right to freely leave their employment. Employees must not be charged recruitment fees, nor should they be subject to practices such as debt bondage or passport retention.

5. Employee Rights and Grievance Procedures

5.1 Right to Representation
- Employees must have the right to representation, including the right to join trade unions and participate in collective bargaining agreements, where applicable.

5.2 Grievance Procedures
- The Client must establish a formal grievance procedure that allows employees to raise concerns about their working conditions, employment terms, or breaches of their rights.

5.3 Termination and Dismissal Protections
- The Client must comply with EU and national rules regarding fair dismissal. Any termination of employment must be conducted lawfully, with appropriate notice periods and reasons that comply with legal standards.

6. Prohibition on Reselling Employee Data
As outlined in the recruitment contract, the Client is expressly prohibited from reselling or transferring employee data to any third party without the written consent of Megative DE GmbH or the employee. Any breach of this clause will be considered a violation of this agreement and may result in legal action.

7. Transparency in Hiring and Employment Decisions
The Client must provide accurate and transparent information to Megative DE GmbH regarding the following:
- The candidates they accept for employment.
- The progress of those candidates during the trial and probation periods.
- Any other data relevant to the recruitment process for invoicing purposes.

Failure to provide this information may result in invoicing disputes and will be considered a breach of this agreement.

8. Legal Recourse and Non-Compliance
If the Client is found to be in violation of any EU or German labor laws, data protection regulations, or the provisions outlined in this Due Diligence Checklist, Megative DE GmbH reserves the right to terminate the recruitment agreement and pursue legal recourse. The Client will be held liable for any damages, penalties, or legal costs resulting from non-compliance.