Reasons for denial of a license to operate a temporary employment agency (part I)

The office of the Fed­er­al Employ­ment Agency (Bun­de­sagen­tur für Arbeit) in charge decides on the grant­i­ng of a license to oper­ate a tem­po­rary employ­ment agency (read more…). Sec. 3 (1) of the Ger­man Law on Tem­po­rary Employ­ment (AÜG, Arbeit­nehmerüber­las­sungs­ge­setz) lists the rea­sons for which the Fed­er­al Employ­ment Agency can deny and/or revoke the license. Please see two relat­ed doc­u­ments here and here where we explain the sev­er­al rea­sons.

Failure to comply with regulations

If facts jus­ti­fy the assump­tion that the tem­po­rary employ­ment agency is unre­li­able, the Fed­er­al Employ­ment Agency may deny the license. The term ‘reli­a­bil­i­ty’ does not have a pre­cise legal def­i­n­i­tion. Sec. 3 (1) AÜG ini­tial­ly lists a num­ber of con­di­tions under which the appli­cant must be assumed to be unre­li­able.

The use of the expres­sion ‘in par­tic­u­lar’ sug­gests that this pro­vi­sion is not exhaus­tive, but only con­tains an exem­plary list.

Pur­suant to sec. 3 (1) no. 1 AÜG, a per­son is deemed to be unre­li­able who vio­lates in par­tic­u­lar the fol­low­ing reg­u­la­tions:

  1. All social secu­ri­ty reg­u­la­tions in the field of health, pen­sion, acci­dent, care and unem­ploy­ment insur­ance
  2. Report­ing and noti­fi­ca­tion oblig­a­tions and in par­tic­u­lar the oblig­a­tion to pay social secu­ri­ty con­tri­bu­tions
  3. With­hold­ing and pay­ment of wage tax, fail­ure to pay oth­er tax­es, such as val­ue-added tax
  4. Reg­u­la­tions con­cern­ing tem­po­rary employ­ment agen­cies pur­suant to sec. 14 I 1 of the Trade, Com­merce and Indus­try Reg­u­la­tion Act (GewO, Gewer­be­ord­nung), sec. 292 et seqq. of the Third Book of the Code of Social Law (SGB III, Sozialge­set­zbuch (SGB) Drittes Buch (III)) and, for instance, the hon­our­ing of agency vouch­ers pur­suant to sec. 421g SGB III
  5. Reg­u­la­tions con­cern­ing the employ­ment of for­eign employ­ees, for instance, pur­suant to sec. 6 (1) no. 2 of the Work Per­mit Reg­u­la­tion (ArGV, Arbeits­genehmi­gungsverord­nung) and sec. 40 (1) no. 2 of the Act on the Res­i­dence, Eco­nom­ic Activ­i­ty and Inte­gra­tion of For­eign­ers in the Fed­er­al Ter­ri­to­ry (Aufen­thaltsG, Gesetz über den Aufen­thalt, die Erwerb­stätigkeit und die Inte­gra­tion von Aus­län­dern im Bun­des­ge­bi­et)
  6. Health and safe­ty reg­u­la­tions under pub­lic law, pur­suant to the Work­ing Hours Act (ArbZG, Arbeit­szeit­ge­setz), the Law for the Pro­tec­tion of Moth­ers Dur­ing Work, Train­ing and Stud­ies (MuSchG, Gesetz zum Schutz von Müt­tern bei der Arbeit, in der Aus­bil­dung und im Studi­um), the Law for the Pro­tec­tion of Youths at Work (JArb­SchG, Gesetz zum Schutze der arbei­t­en­den Jugend) as well as acci­dent pre­ven­tion reg­u­la­tions pur­suant to sec. 11 VI AÜG.
  7. Statu­to­ry max­i­mum dai­ly work­ing hours pur­suant to the ArbzG

The use of the expres­sion ‘in par­tic­u­lar’ sug­gests that this pro­vi­sion is not exhaus­tive, but only con­tains an exem­plary list.

Pur­suant to sec. 3 (1) no. 2 AÜG, the license must be denied if the tem­po­rary employ­ment agency is unable to prop­er­ly ful­fil the usu­al oblig­a­tions of an employ­er in terms of how the busi­ness is organ­ised. (read more…)

The license can also be denied if the tem­po­rary employ­ment agency fails to pro­vide to the tem­po­rary employ­ee the work­ing con­di­tions (equal treat­ment and equal pay — read more…) includ­ing remu­ner­a­tion to which the tem­po­rary employ­ee is enti­tled pur­suant to sec. 8 AÜG. (read more…)

 

How­ev­er, not every vio­la­tion of one of these reg­u­la­tions auto­mat­i­cal­ly means denial or non-renew­al of the license. For exam­ple, occa­sion­al account­ing errors dur­ing hol­i­days or ill­ness alone will not result in denial of the license.

 

See Part II and Part III for more rea­sons that can lead to denial of the license to oper­ate a tem­po­rary employ­ment agency.