Agency work: Will the Constitutional Court stop the Occupational Health and Safety Monitoring Act?

The German Federal Constitutional Court (FCC) could still prevent the part of the Occupational Health and Safety Monitoring Act prohibiting the deployment of third-party staff in the meat-processing industry from entering into effect at the beginning of 2021. In response to the FCC’s request in the ongoing expedited proceedings, the Interessenverband Deutscher Zeitarbeitsunternehmen e.V. (association of German temporary work agencies – AGTA) has stated its position on the constitutionality of the Act.

I. Background

After the coalition partners CDU/CSU and SPD finally came to an agreement, as we reported [Agreement between CDU/CSU and SPD – Noerr], the act on improving implementation of occupational health and safety – occupational health and safety monitoring act – “the Act”) (Gesetz zur Verbesserung des Vollzugs im Arbeitsschutz – Arbeitsschutzkontrollgesetz) was adopted by the Bundestag on 16 December 2020 and ratified by the Bundesrat on 18 December 2020. However, as of today (5 January 2021), it has yet to be promulgated.

The Act not only prohibits any deployment of third-party staff via contracts for work and services (Werkverträge) in the meat industry, but also contains amendments to the Act on Safeguarding Employee Rights in the Meat Industry (Gesetz zur Sicherung von Arbeitnehmerrechten in der Fleischwirtschaft – GSA Fleisch) that prohibit the use of temporary agency workers in most cases as of 1 April 2021 and in all cases as of 1 April 2024.

Unsurprisingly, the temporary work agencies affected by these new laws were not happy with them, and on 23 December 2020, several motions for summary proceedings were filed with the FCC, not least because discussions on the draft bill included doubts as to its constitutionality. The aim of the summary proceedings convened according to section 32 of the German Act on the Federal Constitutional Court (AFCC) is that the provisions that have been called into question are temporarily suspended, i.e. do not enter into effect, until a decision is reached on the constitutionality complaints.

The FCC requested that the AGTA, an association of employers in the temporary agency sector with 3,600 member enterprises throughout Germany, state its position as a third-party expert under section 27a AFCC.

II. The AGTA’s position

The AGTA sees in the new provisions found in the Act an unconstitutional encroachment on the temporary work agencies’ right to practice an occupation freely, as enshrined in Art. 12(1) German Basic Law (Grundgesetz). They believe that the unconstitutionality lies in a breach of the prohibition of excessiveness.

According to the AGTA, the legislator has not even been able to provide valid evidence of the suitability of the restrictions on third-party staff via temporary agencies to fulfil the purpose of the Act, i.e. occupational health and safety. In this context, the AGTA points out that the discussion regarding the draft bill always centred on deploying third-party staff based on contracts for work and services. It continued by saying that temporary agency work had not been discussed and thus its need for regulation, which did not exist at all, especially in the light of the extensive protection provided by the German Act on Temporary Agency Workers (Temporary Work Act) (Arbeitnehmerüberlassungsgesetz – AÜG) and the low percentage of temporary agency workers in the meat industry, was not treated differently. In the opinion of the AGTA, considering the extensive legal and collective bargaining protection and monitoring regulations applicable to temporary agency work, prohibiting it in a particular sector would tend to contradict rather than promote one of the Act’s purposes: to improve working conditions in the meat industry.

The AGTA added that similarly suitable but less drastic measures were not exhausted, making the sectoral prohibition unnecessary. It pointed out that the legislator would have been obliged in particular to wait and observe the effects of the measures prescribed to strengthen monitoring and expand legal foundations that the Act likewise contains before it would have been permissible to take drastic measures restricting and prohibiting temporary agency work. The AGTA’s stated position also refutes the legislator’s argument that it wishes to prevent circumvention in the form of moving from contracts for work and services to temporary agency work by citing the option of more frequent monitoring and the comprehensive occupational health and safety rules enshrined in the Temporary Work Act.

III. Other opinions

In its position paper, the AGTA also mentions others who consider the Act to be unconstitutional. Doubts in this context have been expressed not only in a joint statement in the employment law magazine Neue Zeitschrift für Arbeitsrecht 2020, 1160 but also by several members of the CDU/CSU faction in the Bundestag as well as the German Federal Bar (Bundesrechtsanwaltskammer).

IV. Outlook

In conclusion, the AGTA clarifies in its statement that the constitutional complaints against the Act obviously have merit due to the cited excessiveness, and the FCC’s summary legal protection should be granted for that reason and also in the light of the irreversible disadvantages that would arise if the law entered into effect.

It remains to be seen whether the FCC will follow the AGTA’s statement and temporarily suspend the relevant provisions of the Act. Because the matter is so urgent, a decision in the expedited proceedings is expected very soon.

It then remains to be seen what the FCC’s decision will be in the main proceedings. Questions have been raised regarding not only the Act’s constitutionality but also its conformity with European law, i.e. Art. 45 and 56 TEU and Art. 4(1) of the Temporary Agency Work Directive 2008/104/EC. If the FCC’s decision is negative, this issue could be referred to the CJEU.