Labor, Employment, and Workplace Safety Alert

Following the European Court of Justice (ECJ) ruling of 15 December 2022—C-311/21—the temporary employment industry is once again the focus of caselaw and is once again becoming a considerable risk for both temporary employment agencies and hiring companies.

Background

The German Temporary Employment Act (Arbeitnehmerüberlassungsgesetz (AÜG)) has repeatedly been in the focus of caselaw in recent years and had to be amended several times as a result. Since then, the framework conditions for hiring out workers have become stricter and must be observed.

The principle of equality requires, for example, that temporary workers be granted the same essential working conditions, including remuneration, as permanent employees. However, according to the AÜG, collective bargaining agreements may deviate from this to the disadvantage of temporary agency workers and, for example, provide lower wages to them. The temporary employment industry has made extensive use of this to keep the costs of temporary work within limits.

The ECJ now fundamentally questions this principle.

The ECJ Decision

In its decision of 15 December, the ECJ established the following principles of equal treatment in temporary agency work on the basis of Article 5 of Directive 2008/104/EC on temporary agency work:

• Temporary agency workers are in principle entitled to the same basic working and employment conditions that would apply to them if the hiring company had hired...

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