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Short legal assessment of ECJ ruling

21.07.2017

The ECJ was requested to make a preliminary ruling concerning the German Mitbestimmungsgesetz (MitbestG). A single shareholder of TUI AG (Konrad Erzberger) challenged, before a German Court (Kammergericht Berlin), the composition of the supervisory board (half the members of TUI AG’s supervisory board are appointed by the shareholders and the other half by the employees). 

On 18.07.2017, the ECJ decided that the German Mitbestimmungsgesetz is compatible with EU law. In May 2017, the Advocate General  (Saugmandsgaard Øe, 04.05.2017) had already proposed that the court should decide in favour of the German Mitbestimmungsgesetz.

Short assessment:

  • The ECJ agrees with the main arguments of the Advocate General’s opinion. The judgement is short but very precise (without reference to Gebhard-rules).
  • It remains to be seen whether there will be effects or consequences regarding social rights in general within the EU.

In detail:

The request concerned the interpretation of articles 18 TFEU (principle of nondiscrimination) and 45 TFEU (free movement of workers)

  • Erzberger refers to different aspects:
  1. According to German law: the workers of a group’s subsidiary located outside Germany are deprived of the right to vote and to stand as candidates in elections for representatives to the supervisory board of the parent company (principle of territoriality).
  2. Any worker of the TUI group who carries out tasks within the supervisory board of the parent company must give up those tasks when he takes up a post within one of the subsidiaries of that group located in a state other than Germany.
  • The ECJ notes that the questions must be examined solely on the basis of article 45 TFEU (subsidiarity):
  • The ECJ notes that the situations must be governed by EU law: it stresses that those rules are not applicable to workers who have never exercised their freedom to move within the Union and who do not intend to do so (recital 28)
  • The ECJ notes that article 45 TFEU precludes any national measure which is capable of hindering or rendering less attractive the exercise by Union nationals of the fundamental freedoms guaranteed by that article (recital 33) but
    it stresses that the primary EU law cannot guarantee a worker that moving to a Member State other than his Member State of origin will be neutral in terms of social security, since, given the disparities between the Member  States’ social security schemes and legislation, such a move may be more or less advantageous for the person concerned in that regard (recital 34)
  • The ECJ adds that, in the absence of harmonisation or coordination measures at a Union level in the field concerned, the Member States remain free to set the criteria for defining the scope of application of their legislation, to the extent that those criteria are objective and non-discriminatory. (recital 36)

 

Sophia von Verschuer
Research Associate – Project: Workers’ Voice

Hertie School of Governance GmbH
Friedrichstraße 180 ∙ 10117 Berlin ∙ Germany

Email: ​vonverschuer@hertie-school.org