Germany: Employing staff from CEE through agencies involves a time limitation.
Employing staff from CEE through agencies involves a time limitation.
Employing staff from CEE through agencies (subcontracted labour) is widespread in some sectors. Careless handling of this facility can have serious consequences.
Under the German Temporary Employment Act – Arbeitnehmerüberlassungsgesetz (AÜG) Section 1 para. 1 sentence 2 – employing staff through agencies can only be “temporary”. For the time being, it is still unclear what consequences derive from non-temporary employment of such staff. In particular, this may lead to an employment relationship with the temporary employer. This question has been answered in contradictory fashion by courts of second instance. A final ruling by the Federal Labour Court (Bundesarbeitsgericht – BAG) is pending.
However, currently the BAG has at least decided that § 1 section 1 sentence 2 AÜG has “normative, binding character” and is not only meant to be “descriptive”. This will lead to further discussion on the consequences of “non-temporary” employment of staff through agencies.
If a BAG ruling came to the conclusion that “non-temporary” employment through agencies leads to an employment relationship with the temporary employer this would have severe consequences for the temporary employer as to individual labour contracts and social security.
Therefore, in cases of unlimited or multiple consecutive limited employment of staff through agencies temporary employers should already be very careful.
Source: BAG decision as of 10 July 2013, 7 ABR 91/11