Office concepts of the future: What comes after home office and flexible working?

Innovative office concepts such as desk sharing and open work spaces can be found in more and more companies, alongside an increasing acceptance of home offices and flexible working. Such office concepts are part of the New Work approach which, among other things, encourages interaction between employees.

Although innovative office concepts are primarily associated with start-ups and creative industries, at the moment in particular, more and more employers are discovering their benefits, especially in the mid-market. Co-working spaces, where freelancers and companies, for example, work in open spaces, are also becoming increasingly popular.

Our employment lawyers Alexandra Groth and Annabelle Marceau and our real estate lawyer Dr. Stefanie Minzenmay explain what to look out for from the employment law and real estate law perspectives when introducing new office concepts.

Consideration of individual employment law aspects

Whether and to what extent new office concepts are introduced in a company is basically the decision of the employer. Provided and to the extent that this does not involve a change of location that involves a greater distance, the employer may assign a new spatial area of work to its employees within the framework of its right of direction.

In the case of office concepts such as desk sharing and open workspace jobs, the employer also has special occupational health and safety obligations: it is not only during pandemics that companies have to pay more attention to compliance with hygiene standards (in this respect, see also “Occupational health and safety - "SARS-Cov2 occupational health and safety standard” and “Tightening of corona protection rules at the workplace - is home office now compulsory?”).

Employers also have to consider the IT security and data protection requirements. This is especially the case for stationary workstations that can be used by multiple workers. Corporate guidelines such as the clean desk policy can provide uniform requirements in this regard.

Peculiarity of co-working spaces

The characteristic feature of co-working spaces is that different professional groups generally share workplaces and infrastructure for limited periods. However, especially in cases where employees of different employers share a single co-working space, the following key issues need to be considered: it is important to comply with data protection and IT security provisions by introducing and implementing clear guidelines. In the case of jointly used rooms, there is a risk of confidential information falling into the wrong hands. Furthermore, occupational health and safety must be observed: whereas the company has the decision-making authority in the case of its own premises, in the case of co-working spaces importance also and especially needs to be attached to the lessor's obligation. For example, it must be regulated that the lessor supports the employer in risk assessments.

From the employment law perspective, there is also the issue of the so-called joint venture (cf. § 1 (2) German Shop Constitution Act [Betriebsverfassungsgesetz, BetrVG]). If the assumption is made that different employers are structurally working together and under a single management, this poses a real risk. Since case law has historically recognised implied management agreements, this does not even require a written agreement on the joint venture. This essentially means that an established works council is responsible for the employees of all employers. Here, there are various approaches to avoid the creation of such a joint venture: e.g. clear separation of the work areas and the work equipment used. However, this seems to contradict the basic concept of a co-working space, with the result that the focus needs to be put on other approaches.

Co-determination of the works council

An existing works council always has to be involved in the introduction of new office concepts. The works council does not only have information and consultation rights. Rather, this generally triggers the mandatory co-determination of the works council, since the introduction of new office concepts affects the organisational conduct of employees. In addition, changes to workplaces require the execution of a new risk assessment, in the context of which the works council also has to be involved.

If new office space is rented at a different location as a result of the decision in favour of alternative office concepts and if there is a change of location, then under certain circumstances this may constitute a change of business requiring the works council’s participation, in the context of which a compromise of interests and, if necessary, a social plan must be negotiated with the works council. The introduction of desk-sharing or open workspace areas are also fundamentally new working methods which can likewise constitute a measure requiring a compromise of interests. Incidentally, this also applies to structural alteration measures at the previous business location. Time delays caused by the co-determination process should be taken into account in the planning process.

Changes to the leased property

Changing work environments may require structural changes to the leased property. If open work spaces are to be set up where individual offices were once located, employers are advised to take a look at the lease agreement. Structural changes usually require the prior written consent of the lessor. When obtaining this consent, the issue of restoring the previous condition at the end of the lease period should also be taken into consideration and, if necessary, regulated in the form of an addendum to the lease agreement. In contrast, purely oral agreements on changes to the leased property should be avoided. In the case of lease agreements that are concluded for a period of more than one year, a breach of the statutory written form requirement will result in the lease agreement being terminable prematurely.

The public law issues of a structural change associated with a change in the leased property also require clarification, in particular which party has to obtain any necessary official permits and at whose expense. Modified floor plans may require approval because they affect the statics and fire protection, for example by changing the escape route situation.

If the changed use concepts make a different and possibly longer lease of the leased property interesting, a contribution to the conversion costs could also be attractive for the lessor when extending the lease agreement.

Reduction of leased areas

If advancing digitisation further inspires home office concepts or desk sharing leads to a significant reduction in the space required for employees, this raises the question of how an existing lease can be adapted to meet these needs. Mutually agreed solutions with the lessor are always possible, but are only of interest to the lessor if it receives economic compensation. This could be in the form of the provision of a new lessee for the vacated space or a release payment. An alternative could be (partial) subletting. To the extent not already contractually permitted, subletting requires the lessor’s permission. If the lessor refuses to give its permission without there being an important reason relating to the person of the sub-lessee, the lessee may terminate the lease relationship in its entirety. Such termination is only not possible if this statutory right of termination has been expressly excluded in the lease agreement.

Considerations in case of new leases

In case of new leases, the intended use should be defined broadly and flexibly in the lease agreement. Subletting options permitted from the outset can also be agreed with the lessor and already regulated in the lease agreement.

In order to ensure the future multi-functionality of the leased premises, certain conversion measures (single office structures/co-working areas) can already be permitted in the lease agreement in the lessee’s favour and, in the case of a "letting from the drawing board", the structural engineering for this can already be provided for. If the lessee has a good negotiating position it can have itself granted special termination rights, both to shorten the lease period but also for partial areas of the leased property. Conversely, options for expansion areas are of course also conceivable.

The introduction of new, innovative office concepts offers far-reaching advantages for companies: besides cost reductions, flexibility for employees and freelancers, open or shared office spaces promote exchange and social interaction. The introduction of correspondingly new and flexible workplaces initially requires a certain investment on the part of the companies, however. In addition to structural changes and adjustments to the lease agreement, employee representatives also have to be involved at the collective law level, and employees need to be assigned new workplaces under individual law. Our experts would be happy to advise you individually on the planning and introduction of new office concepts.

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