Equal treatment and equal pay in Temporary Employment
Temporary employees must be treated in the same way as the permanent employees in the hirer’s company (so-called regular employees). This right to equal treatment results from sec. 8 (1) sentence 1 of the German Act on Temporary Employment (AÜG, Arbeitnehmerüberlassungsgesetz) and applies to all essential working conditions.
Equal pay is a subset of equal treatment. If the temporary employee is to be treated in every respect in the same way as the regular employee, this is referred to as the principle of equal treatment.
If a temporary employee is be treated like a regular employee only in financial terms (‘same work, same pay’), this is then referred to as equal pay.
Essential working conditions
‘Essential working conditions’ are all conditions agreed under German labour law. Details of this distinction are controversial. However, these definitely include wages, vacation, working hours, notice periods and the keeping of a working time account.
When comparing the working conditions of the temporary employment agency with those of the customer’s company in order to ensure equal treatment of the temporary employee, a comparison of characteristic groups must be made. This means that an isolated view of the individual working conditions is not acceptable; instead, they must be assigned to a so-called characteristic group, such as ‘holiday’ or ‘pay’.
Derogation from the principle of equal treatment pursuant to sec. 8 (2) sentence 1 AÜG is possible if a collective agreement for temporary work applies to the relationship between the employer and the temporary employee.
in which case the temporary employee must be treated in accordance with the collective agreement.
However: Entitlement to equal pay can only be waived for a period of nine months. This means that even after the 9‑month period of employment, the hirer must still treat the temporary employee in accordance with the collective agreement, but the temporary employee must receive at least the pay received by comparable regular employees of the hirer.
Derogation for a longer, maximum period of up to 15 months is possible if a collective agreement on industry surcharges applies to the employment. In this case, gradual adjustment to the regular employee’s remuneration is required after six weeks of employment at the latest (sec. 8 (4) sentence 2 no. 1 and 2 AÜG).
Principle of equality
For the avoidance of doubt: The principle of equality should not be mixed up with the principle of equal treatment. The principle of equality is a special feature that is only relevant for temporary employment. The principle of equality compares the working conditions of the temporary employee with those of the customer’s regular employees. This means that every person in the comparison has a different employer.
The principle of equal treatment, on the other hand, applies throughout labour law and provides that an employer may not discriminate against its own employees without cause.