1. Presentation of Case C-533/13 (AKT-case) and Directive 2008/104/EC on Temporary Agency Work European Labour Law – April 19 2016 Louise Jöndell Almira Medetova Ainamkoz Bakytkaliyeva

2. Outline Background Presentation of the case Questions raised by the Finnish Labour Court Conclusion of the Advocate General The decision of the European Court of Justice Decision by the Finnish Labour Court Conclusions and reflections Questions

3. Background  First case brought on Directive 2008/104/EC  Aim and purpose of the Directive  protect workers hired through temporary employment agencies  establishing a protective and non-discriminatory framework  respecting the diversity of labour markets and industrial relations  in an effective way contribute to job creation and the development of flexible forms of working  Level of harmonization  requires measures at the Union-level by introducing minimum requirements  The definition of workers as “Temporary Agency Workers”

4. Article 3(1) – definition of Temporary Agency Worker c) “A temporary agency worker means a worker with a contract of employment or an employment relationship with a temporary-work agency with a view to being assigned to a user undertaking to work temporarily under its supervision and directions”.

5. Background  The Principle of Equal Treatment (article 5)  Reference to  The Charter of Fundamental Rights of the European Union and  The Community Charter of the Fundamental Rights of Workers  Different status and legal situations within the different Member States  Article 4 of Directive 2008/104/EC – review of restrictions and prohibitions on the use of Temporary Agency Workers  Only justified on grounds of general interest  Autonomy of the social partners

6. Collective agreements  Collective agreements in Finland and Scandinavia  The “Scandinavian Model”  Implementation of Directives through collective agreements  Case 143/83 Commission vs. Denmark  In Finland the Collective Bargaining Act lays down a direct legal basis for declaring collective agreements generally binding

7. Presentation of the case

8. Finnish Transport Workers’ Union AKT (Auto- ja Kuljetusalan Työntekijäliitto AKT ry) Vs. Employers association for Oil Products (Öljytuote ry) and one of their members SAF (Shell Aviation Finland Oy)

9. The Collective Agreement for the tanker and oil product sector (Sectoral Agreement)  Article 29(1) “Companies should limit the use of temporary agency workers, to apply only for dealing with peaks of work or to the performance of other tasks of limited duration or of a specific nature, which, for reasons of urgency or because of their limited duration or skill requirements or the use of special tools or other similar reasons, cannot have been performed by their own staff.” (my translation)

10. The Collective Agreement for the tanker and oil product sector (Sectoral Agreement)  Article 29(1) “Temporary employment shall be deemed unfair if the leased employees for a longer period of time perform normal work alongside the company’s permanent employees, and under the same management.” (my translation)

11. The opinion of AKT  Claimed that SAF between 2008-2012;  on a regular basis,  and on a considerable scale had used temporary workers  for the purpose to perform tasks that were identical with those carried out by its own workers.  “Unfair practice” within the meaning of article 29(1) in the Sectoral Agreement and provision 8.3 of the General Agreement.

12. The opinion of SAF and their employers association  Denied responsibility  Action justified by legitimate reasons;  replacing workers during periods of annual leave  replacing workers during sick leave  Claimed that Provision 29(1) of the Sectoral Agreement contained a restriction that could not be justified by the reasons laid down in article 4(1) of Directive 2008/104/EC and wanted the national court to disapply the provision for being contrary to the directive.

13. Implementation of the Directive  In Finland, the Directive was transposed into national law through the adoption of a law amending the Employment Contracts Act (55/2001) and the Posted Workers Act (1146/1999).

14. The preliminary opinion of the Finnish Labour Court Article 4 does not require the Member States to amend their legislation, even in the event that a restriction on the use of temporary agency work cannot be justified on grounds of general interest. The scope of the obligation imposed on the Member States by Article 4 raises doubts, the provision may be interpreted as imposing on the Member States an obligation to ensure that their legal systems contain no unjustified restrictions or prohibitions relating to temporary agency work.

15. The preliminary opinion of the Finish Labor Court Paragraph 29(1) of the sectoral agreement follows different approach from that defined by Directive 2008/104, inasmuch as it prohibits the employment of temporary agency workers except in certain specific cases, in order to protect the permanent workers of undertakings.

16. The first question raised by the Finnish Labour Court  Is Article 4(1) of... Directive [2008/104] to be interpreted as imposing on national authorities, including the courts, a permanent obligation to ensure, by the means available to them, that no statutory provisions or clauses in national collective agreements exist that are contrary to the rules laid down by the directive or that, if such provisions or clauses exist, they are not applied?

17. The second question raised by the Finnish Labour Court  Is Article 4(1) of... Directive [2008/104] to be interpreted as precluding national rules pursuant to which the use of temporary labour is permitted only in certain specific cases, such as to deal with peaks of work or to perform tasks which an undertaking cannot have its own employees perform? May the employment of temporary agency workers for a long period of time to carry out an undertaking’s usual work alongside the undertaking’s own employees be characterised as an unlawful use of temporary agency work?

18. The third question raised by the Finnish Labour Court  If national rules are found to be contrary to... Directive [2008/104], what means are available to the courts to achieve the objectives of the directive in the event that the rules at issue are contained in a collective agreement that governs relationships between individuals?’

19. Opinion of the Advocate General The questions referred by the national court raise three issues regarding the interpretation of Article 4(1) of Directive:  The scope of the obligations imposed by that provision on the Member States;  The possibility of justifying, for the purposes of that provision, the restrictions on the use of temporary agency work laid down in the sectoral agreement, and  Whether the provision of the directive in question may be relied on in disputes between individuals.

20. The scope of the obligations imposed by provision on MS The provision requires the Member States to remove any restrictions on the use of temporary agency work that cannot be justified. It does not impose on the Member States any obligation to achieve the specific result of ensuring that existing restrictions in their legislation are indeed justified on grounds of general interest.

21. The scope of obligations “I propose by way of answer to the first question that Article 4(1) of Directive 2008/104 prohibits the continued application or the introduction of prohibitions or restrictions on the use of temporary agency work that are not justified on grounds of general interest relating, in particular, to the protection of temporary agency workers, the requirements of health and safety at work or the need to ensure that the labour market functions properly and abuses are prevented.” C-513/33, AKT, par. 93

22. The justification of restrictions under Article 4 (1) By its second question, the national court seeks to establish whether a provision such as that laid down in Paragraph 29(1) of the sectoral agreement constitutes a restriction within the meaning of Article 4(1) of Directive 2008/104 and, if so, whether it may be justified.

23. The justification of restrictions ‘Undertakings shall restrict the use of temporary agency workers to dealing with peaks of work or to the performance of other tasks of limited duration or of a specific nature which, for reasons of urgency or because of their limited duration or skill requirements or the use of special tools or other similar reasons, they cannot have performed by their own staff. The use of temporary workers is an unfair practice if the temporary agency workers employed by undertakings using external workers carry out the undertaking’s usual work alongside the undertaking’s permanent workers under the same management and for a long period of time. Paragraph 29(1)

24. The justification of restrictions I consider that Article 4(1) of Directive 2008/104 does not preclude national rules which, first, restrict the use of temporary agency work to the performance of tasks that are temporary and which, for objective reasons, cannot be carried out by workers employed directly by the user undertaking and, secondly, prohibit the employment of temporary agency workers alongside workers employed directly by the user undertaking to carry out tasks identical to those carried out by its own workers for a long period of time.

25. The decision of the Advocate General To lift unjustified restrictions To ensure equal treatment of Temporary Agency workers. The restrictions on the use of temporary agency workers are already prohibited by the Article 56 of the Treaty on Functioning of European Union.

26. The decision of the Advocate General The interpretation of Article. 4, par. 1, as a provision that gives effect to the prohibition of restrictions on freedom to provide services under Article. 56 TFEU, then leads the Advocate General to attribute to this rule horizontal direct effect.

27. The decision of the Advocate General In European Union law under the doctrine of direct effect, national courts are under a legal duty to interpret national laws to be consistent with EU laws which the member state concerned has either not implemented or not implemented correctly. The ability of such interpretations to affect the legal rights and duties of purely private entities is called horizontal direct effect.

28. The decision of Advocate General In the event that the Court should regard it as necessary to consider the third question, I would propose by way of answer to the third question that Article 4(1) of Directive 2008/104 may be relied on by an undertaking against a trade union.

29. General Collective Agreement Point 8(3) of the agreement states:  “Undertakings shall restrict the use of temporary agency workers to dealing with peaks of work or to the performance of other tasks of limited duration or of a specific nature which, for reasons of urgency or because of their limited duration or skill requirements or the use of special tools or other similar reasons, they cannot have performed by their own staff.  The use of temporary workers is an unfair practice if the temporary agency workers employed by undertakings using external workers carry out the undertaking’s usual work alongside the undertaking’s permanent workers under the same management and for a long period of time.

30. Legal basis and object of the report Obligations under Article 4: Objects: -The way of implementation of the Directive by Member States and highlight the main problems in legislation. -To provide a review of restrictions and prohibitions on the use of agency work by Member States. Article 12 states: «By 5 December 2013, the Commission shall, in consultation with the Member States and social partners at Community level, review the application of this Directive with a view to proposing, where appropriate, the necessary amendments.»

31. Review of restrictions and prohibitions  prohibition to use temporary agency work in sectors of activity which are considered as dangerous;  prohibition to offer contracts of indefinite duration to temporary agency workers;  existence of a limitative list of permissible reasons for using temporary agency work (e.g. to cover temporary and exceptional peaks of work, to replace an absent employee...);  limitation of the duration of assignments;  limitation of the number of possible renewals of temporary agency workers' contracts of employment;  limitation of the numbers or proportion of agency workers that may work in user companies;

32. Directive 2008/104 on Temporary Agency Work Article.4 in the general context of the Directive Protecting temporary agency workers Supporting the role of temporary agency workers in providing sufficient flexibility in the labor market Article 2 recalls the aim of the Directive: «The purpose of this 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, as set out in Article 5, is applied to temporary agency workers, and by recognizing temporary-work agencies as employers, while taking into account the need to establish a suitable framework for the use of temporary agency work with a view to contributing effectively to the creation of jobs and to the development of flexible forms of working."

33. Directive 2008/104 and TFEU Article.4 (4) Paragraphs 1, 2 and 3 shall be without prejudice to national requirements with regard to registration, licensing, certification, financial guarantees or monitoring of temporary- work agencies. Article 56 (ex Article 49 TEC) Within the framework of the provisions set out below, restrictions on freedom to provide services within the Union shall be prohibited in respect of nationals of Member States who are established in a Member State other than that of the person for whom the services are intended. The European Parliament and the Council, acting in accordance with the ordinary legislative procedure, may extend the provisions of the Chapter to nationals of a third country who provide services and who are established within the Union.

34. Interpretation of the Directive by ECJ (1) Article 4(1) Prohibitions or restrictions on the use of temporary agency work shall be justified only on grounds of general interest relating in particular to the protection of temporary agency workers, the requirements of health and safety at work or the need to ensure that the labour market functions properly and abuses are prevented. Member States Remove prohibitions/restriction which are not justified on GROUNDS OF GENERAL INTEREST Adopt legislation where applicable in order to render them compliant with the Directive.

35. Interpretation of the Directive by ECJ (2) Protection of Temporary agency workers: - To stabilize the situation with temporary work agencies. - Regulation of temporary work agencies status - Limitation the use of temporary workers only on grounds of basic standards. - Equality in respect of the basic working and employment conditions: duration of working time, rest breaks, rest periods, night work, annual leave and public holidays; and; pay. The review exercise is to be carried out by the competent authorities in each Member State. In compliance with article 4(2), it must be preceded by a consultation of the social partners; the Directive expressly states that this consultation shall take place in accordance with national legislation, collective agreements and practices.

36. Interpretation of the Directive by ECJ (3) Article 4(1) of Directive 2008/104/EC of the European Parliament and of the Council of November 2008 on temporary agency work must be interpreted as meaning that: - the provision is addressed only to competent authorities of the Member States, imposing on them an obligation to review in order to ensure that any potential prohibitions or restrictions on the use of temporary agency work are justified, and, therefore, - the provision does not impose an obligation on national courts not to apply any rule of national law containing prohibitions or restrictions on the use of temporary agency work which are not justified on grounds of general interest within the meaning of Article 4(1).

37. The decision by the Finnish Labour Court  Decision TT 2016:11 from the 8 th February 2016  Unanimous decision that the;  Constant use of temporary agency workers between 2008 and 2012,  Performing same duties as permanent employees,  Constituted a violation of provision 29(1) of the Sectoral agreement.  Breach of Article 7 of the Finnish Collective Agreement act.  Breach of Article 8(1) of the Finnish Collective Agreement act.  Failing on their duty of supervision

38. Conclusions and reflections