Key Issues: Social Policy - Equal Treatment – Temporary Agency Work - Preliminary Ruling

Case: JH v KG

Reference: Case C-681/18, CJEU (Second Chamber), 14 October 2020

Legislation: Directive 2008/104

Background

JH, an employee hired by a temporary-work agency, was assigned, as a temporary agency worker, to the undertaking KG between 3 March 2014 and 30 November 2016 by means of several successive temporary agency contracts (8 in total) and various extensions (17 in total). In February 2017, JH brought an action before the District Court, Brescia, Italy, seeking a declaration that there was a permanent employment relationship between him and KG owing to the unlawful use of successive and uninterrupted assignments between March 2014 and November 2016. He also asked that court to find and declare that the temporary agency contracts assigning him to KG were unlawful and/or improper and/or invalid.

In that connection, JH submits that the national (Italian) provisions on temporary agency work applicable to the main proceedings are contrary to Directive 2008/104 as they do not place any limits on successive assignments of workers to the same user. In particular, it is apparent from recital 15 of that directive that, in general, employment relationships should take the form of a contract of indefinite duration. In addition, the first sentence of Article 5(5) of that directive requires Member States to take appropriate measures with a view to preventing successive assignments designed to circumvent the directive’s provisions.

The District Court, Brescia referred a number of questions to the Court of Justice of the EU on the interpretation of Directive 2008/104.

Consideration by CJEU

Directive 2008/104 is intended to establish a protective framework for temporary workers which is non-discriminatory, transparent and proportionate, while respecting the diversity of labour markets and industrial relations. Accordingly, under Article 2 of that directive, the purpose of that directive is to ensure the protection of temporary agency workers and to improve the quality of temporary agency work by ensuring that the principle of equal treatment is applied to those workers and by recognising temporary-work agencies as employers, while taking into account the need to establish a suitable framework for the use of that type of work with a view to contributing effectively to the creation of jobs and to the development of flexible forms of working.

To that end, Directive 2008/104 provides only for the introduction of minimum requirements (i) to ensure observance of the principle of equal treatment of temporary agency workers, established in Article 5 of that directive, and (ii) to review the prohibitions and restrictions applying to temporary agency work laid down by Member States so that only those which are justified on public interest grounds and which relate to the protection of workers, as provided for in Article 4 of the directive, are retained.

The first sentence of Article 5(5) of Directive 2008/104 provides that Member States are to take appropriate measures, in accordance with national law and/or practice, with a view to preventing misuse in the application of that article and, in particular, to preventing successive assignments designed to circumvent the provisions of that directive. That provision therefore does not require Member States to limit the number of successive assignments of the same worker to the same user undertaking or to make the use of that form of fixed-term work subject to the prerequisite that the technical, production, organisational or replacement-related reasons be stated. Furthermore, neither that provision nor any other provision of that directive lays down any specific measure which the Member States should take for that purpose.

The CJEU held that:     

The first sentence of Article 5(5) of Directive 2008/104/EC must be interpreted as not precluding national legislation which does not limit the number of successive assignments that the same temporary agency worker may fulfil at the same user undertaking and does not make the lawfulness of the use of temporary agency work subject to the prerequisite that it must be justified by technical, production, organisation or replacement-related reasons.

On the other hand, that provision must also be interpreted as precluding a Member State from taking no measures at all to preserve the temporary nature of temporary agency work and as precluding national legislation which does not lay down any measure to prevent successive assignments of the same temporary agency worker to the same user undertaking in order to circumvent the provisions of Directive 2008/104 as a whole.

Why is this decision important?

A business that engages with an agency for the hire of temporary agency workers should consider carefully the applicable national legislation in the light of Directive 2008/104 and this judgment. The business may need legal advice on whether it can use a series of successive assignments without creating an employment relationship with the worker. In relation to the obligation on Member States, this decision can be summarised as “you don’t have to do this thing, but you can’t do nothing”.

Note: although the EU (Withdrawal) Act 2018 provides that a UK court or tribunal is not  bound by decisions of the CJEU after the UK leaves the EU, it is likely that UK courts and tribunals will continue to have regard to decisions (past and future) of the CJEU in regard to “retained EU law” unless the UK Supreme Court decides to depart from the CJEU on a particular matter. For this reason, we consider it important to continue to provide case reports on noteworthy CJEU decisions.