I. Maximum time period for the supply

The use of temporary employees is restricted to a maximum of 18 months for time periods after 1 April 2017. Time periods before 1 April do not have to be taken into account. If the period permitted is exceeded, an employment contract with the hirer is concluded. The individual temporary worker is relevant for calculating the time period, not the workplace involved or whether the temporary employee is supplied by one or several placement agencies. Time periods are added up unless at least one interruption of three months occurs between time periods. However, the time periods will not be added up if the temporary workers are sent to different group companies.

II. Equal Pay

The supplier has to grant the temporary workers the same working conditions, (e.g. wage/salary including all fringe benefits, working time, vacation) the hirer grants to the core workforce. A collective bargaining agreement for temporary employment may deviate from these conditions for a time period of up to 9 months and the period may be extended to up to 15 months if the collective bargaining agreement gradually raises the remuneration of the temporary employees to the level of comparable employees in the same sector of employment. Again, time periods before 1 April are not taken into account, time periods are not added up if the temporary workers are sent to different group companies and an interruption of at least three months between time periods will result in a new possible time period of nine months in which deviation from equal pay is permitted.

III. Obligation of disclosure of the supply

In the future the agreement between hirer and supplier has to explicitly state that the agreement is a temporary employment agreement; otherwise, the supply of personnel is illegal. This way, the current way of providing security for questionable service contracts (“Werkverträge”) by a license of the contractor to supply temporary workers is no longer possible. In addition, the temporary workers affected have to be correctly listed before being sent to the hirer by the supplier. The supplier has to explicitly inform the temporary workers that a supply of personnel is taking place.

IV. No chain, intermediate or sub-supply

Temporary workers may not be sub-supplied. An employment contract has to be concluded directly between the supplier and the temporary worker with no suppliers in intermediate positions.

V. No use as strike breakers

The hirer may not employ temporary workers instead of employees who are on strike against the hirer. The prohibition does not apply to temporary workers who have already been hired before the strike and continue their performance. However, the temporary workers have a right to refuse performance and have to be informed about this by the hirer.

VI. Considering threshold values for the right of co-determination

According to the new § 14 sec. 2 AÜG, temporary workers have to be taken into account by the supplier not only for calculating all threshold values of the works constitution act, but also for calculating the threshold values for corporation co-determination (e.g. according to the one-third participation act >500 employees or according to the co-determination act >2000 employees).

VII. Stronger involvement of the workers’ council

The current provisions already stipulated that the hirer has to inform the workers’ council about the employment of temporary workers and has to obtain approval for the employment of temporary workers. The revised version stipulates in addition that the hirer has to inform its workers’ council about the duration of the employment, the place of employment and the temporary employee’s tasks and to submit the contract about the supply of a temporary employee to the workers’ council.

VIII. Legal definition of the term “employee”

The term “employee” is defined in § 611 a BGB (German Civil Code) by the reform law. However, this definition exactly corresponds to the definition according to current decisions by the Supreme Court about the concept of an employee. In this context, all circumstances have to be considered. The existence of an employment relationship can be assumed if services are performed in order to do work which is bound by directives and not self-determined and in personal dependency. However, the actual fulfilment of the employment contract is essential for an estimation.