C-181/83

J U D G M E N T O F T H E C O U R T (FIRST CHAMBER) 29 NOVEMBER 1984

A. Weber ν Bestuur van de Nieuwe Algemene Bedrijfsvereniging (reference for a preliminary ruling from the Centrale Raad van Beroep, Utrecht)

(Social security — Article 47 of Regulation N o 1408/71 — Calculation of the theoretical amount)

Case 181/83

Social security for migrant workers - Invalidity insurance - Calculation of benefits - termination ofthe teoreticaI amount _ Amount of benefits independent of the length of the insurance periods-Article 47 (1) of Regulation No 1408/71not applicable (Regulation No 1408/71 of the Council, Art. 47 (1))

The contingencies referred to in Article person concerned, and for that purpose 47 (1) of Regulation No 1408/71 do not takes account either of the fixed salary cover the case of a scheme of invalidity last received by the person concerned in benefits under which the amount of that occupation before he became inca­ benefit does not depend on the length of pacitated for work, or of the average the insurance periods and which, for the wage received by him over a certain calculation of the loss of earnings, is number of days (which must not fall based primarily on the wage received in more than two years before he became the occupation usually carried on by the incapacitated for work).

o n the interpretation of Article 47 of Regulation ( E E C ) N o 1 4 0 8 / 7 1 of the Council of 14 J u n e 1971 o n the application of social security schemes to employed persons and their families moving within the C o m m u n i t y (Official J o u r n a l , English Special Edition 1971 (II), p. 416),

T H E C O U R T (First C h a m b e r )

composed of: G. Bosco, President of Chamber, A. O'Keeffe and T. Koopmans, Judges,

Advocate G e n e r a l : C. O . L e n z Registrar: D . L o u t e r m a n , Administrator

gives the following

JUDGMENT

14 May 1973 he took up employment as for the disability benefit, in the year a surveyor's assistant in Freiburg. following that date and on the basis of a five-day week. These general On 11 June 1974 he became inca­ rules shall be published in the Neder­ pacitated for work. He received daily landse Staatscourant. sickness benefits. On 17 September 1974 he returned to the Netherlands, where 2. Notwithstanding the provisions of he continued to receive daily sickness the preceding paragraph or the benefits until 1 September 1975. general rules referred to therein, the Sociale Verzekeringsraad may adopt In the meantime — apparently in June special rules for the determination of 1975 — he had claimed disability the daily wage, subject to ministerial benefits from the defendant in the main approval. These special rules shall proceedings. By a decision of 29 Sep­ also be published in the Nederlandse tember 1977 he was granted a pro rata Staatscourant." benefit under t h e Wet op de Ar­ beidsongeschiktheidsverzekering (WAO) [Netherlands Law on Disability In­ The term "daily wage" is, in so far as it surance] as from 1 September 1975 (the is relevant to this case, defined in greater date on which he ceased to receive daily detail in the WAO general rules for the sickness benefits). The benefit paid under calculation of the daily wage (Decision the WAO is calculated on the basis of No 61524 of the Sociale Verzeke­ the average wage earned by the claiment ringsraad of 20 April 1967, adopted in the year immediately preceding the pursuant to Article 14(1) and (2) of the date on which he became incapacitated. WAO, Staatscourant 1967 No 126, and amended by subsequent decisions).

not increased by overtime or by- By an order of 9 August 1983 the benefits, as provided for in Article 1 Centrale Raad van Beroep, Utrecht, (3) (d), in so far as they form part of submitted the following preliminary the normal wage lawfully paid — questions to the Court, pursuant to the daily wage shall be calculated Article 177 of the EEC Treaty: in the manner provided for in the following paragraphs. Any sup- " 1 . Are the provisions of Article 47 (1) plements lawfully paid over a given of Regulation No 1408/71 also period shall be included in that fixed applicable in cases in which the amount. second sentence of Article 46 (2) (a) of the regulation applies? 2. Where the wage consisted ex- clusively of a fixed amount, as 2. If so, must subparagraph (a) and/or provided for in the preceding subparagraph (b) of Article 47 (1) paragraph, the daily wage shall be of Regulation No 1408/71, having equal to the fixed amount per day, regard to their wording and their or, as the case may be, ''260 of the purpose, be interpreted as applying weekly wage multiplied by 52, or of to a scheme relating to invalidity the monthly wage multiplied by 12, benefits which: or of the yearly wage. 3. Where overtime was worked which (a) is a risk scheme; may be taken into account for the (b) is not based, for the calculation calculation of the daily wage, the of the benefit, on the wages daily wage shall be increased by earned during all the insurance the amount produced by applying periods completed; Article 3 by analogy. but 4. . . . 5. . . . " (c) is based primarily — for the determination of the wages lost In applying these provisions, the — on the wage received in the defendant in the main proceedings took occupation usually carried on; the view that the occupation of and surveyor's assistant, in which the plaintiff had most recently engaged in the Federal (d) in that connection, takes into Republic of Germany, should be account either the last fixed regarded as his usual occupation. Mr wage received by the person Weber disagreed with this method of concerned in that occupation calculation, and he challenged the before he became incapacitated defendant's decision before the Centrale for work or the average wage Raad van Beroep, where he argued that, received during a specific period according to Article 47 (1) of Regulation (not more than two years before N o 1408/71, in the circumstances he became incapacitated for specified in subparagraphs (a) to (d) of work) ? that provision, the competent institution of a Member State must calculate the 3. If the previous question is answered theoretical amount referred to in Article in the affirmative, is there anything 46 (29 (a) on the basis of the wages to prevent a Member State from pro- earned, contributions paid, etc., during ceeding, for the calculation of the the insurance periods completed under theoretical amount of the invalidity the legislation of the Member State in benefit referred to in Article 46 (2) question, that is to say, in Mr Weber's (a) of Regulation N o 1408/71, on case, the Netherlands. the basis of the last wage received

Pursuant to Article 20 of the Protocol on As a result the NAB concludes that the the Statute of the Court of Justice of the first question should be answered in the European Communities, written obser­ negative. vations were lodged by the following: the Nieuwe Algemene Bedrijfsvereniging, Should the Court however reply to the represented by W. Η. Levelt-Overmars, first question in the affirmative, the NAB head of the legal department of the has observations in regard to the second Gemeenschappelijk Administratiekantoor question: [Common Administrative Office for Social Security Matters]; the Nether­ lands Government, represented by I. Ver­ A — In the NAB's view, the rules kade, Secretary General at the Ministry contained in Article 47 (1) of Regulation of Foreign Affairs; and the Commission No 1408/71 apply solely to systems in of the European Communities, rep­ which the amount of benefit is calculated resented by its Legal Adviser, J. on the basis of the wages earned, the Griesmar, acting as Agent, assisted by F. contributions paid, etc., during all the Herbert, of the Brussels Bar. insurance periods completed.

Member State. Moreover, these systems benefits are calculated on the basis of always include rules designed to adjust average earnings, an average contri­ the amounts of wages earned or con­ bution, an average increase, or on the tributions paid in the past in accordance ratio which existed, during the insurance with intervening changes in prices or periods, between the claimant's gross wages. earnings and the average gross earnings of all insured persons other than apprentices. The foregoing is equally valid for disability insurance schemes which are incoporated in the statutory old-age Article 47 (1) (b) applies to schemes insurance scheme and thus have the under which invalidity and old-age character of an endowment scheme, such benefits are calculated on the basis of as the Italian, Luxembourg, German and the amount of earnings, contributions or Greek schemes. increases.

WEBER ν NIEUWE ALGEMENE BEDRIJFSVERENIGING

Secondly, if the provisions of Article 47 The Netherlands Government thinks that (1) (a) and (b) were applied and if as the first question calls for a negative a result wages earned abroad were reply. According to the second sentence not considered for the purpose of of Article 46 (2) (a), the amount of determining the daily wage, it would be the benefit, determined in accordance quite impossible to determine the daily with the legislation administered by wage where wages were earned in the the competent institution, must be Netherlands only in the relatively distant considered the theoretical amount if, past, as is the case here. under that legislation, the amount of the

JUDGMENT OF 29. 11. 1984 — CASE 181/83

"If the amount of the benefits paid under the legislation does not depend on the The questions posed in this case concern length of the insurance periods com­ one of the problems which arise when a pleted (standard amount or percentage worker, like the plaintiff in the main of lost wages), that amount is to be proceedings, has had a so-called taken as the theoretical amount (para­ "mixed" working life: that is to say, he graph 2)." has been subject successively to an endowment scheme (a type Β scheme, in this case the German system of invalidity The provision which became Article 47 insurance) and a risk scheme (a type A (1) is explained in this way: scheme, in this case the Netherlands system of invalidity insurance). Whereas endowment schemes, in so far as the "The first paragraph lays down the conditions for the granting of benefit are factors which, on the basis of insurance concerned, are similar to old-age pension periods completed under other legis­ schemes, risk schemes resemble more lation, must be considered in calculating closely health insurance. the theoretical amount referred to in paragraph (2) of the previous article, where the calculation of benefits For the Belgian, French and Netherlands according to the legislation in question is insurance schemes this means that based on average earnings, an average benefits can only be received if working contribution, an average increase or on or earning capacities recently used as an the ratio which existed between the insured person can no longer be used as claimant's earnings and the average a result of a long-term disability. earnings of all insured persons (subpara­ graph (a)), on the amount of the wages earned or contributions paid (subpara­ Endowment systems, on the other hand, graph (b)), on standard earnings or a are based on the fact that the benefits fixed amount (subparagraph (c)), or on received in the event of prolonged actual earnings for some periods and on disability depend on the period during standard earnings for other periods . . ." which a person was. insured or resident

In order to remedy that situation Regu­ Under endowment schemes, which lation No 1408/71 provides for a resemble old-age pension schemes, the number of legal fictions in the field of calculation is based in general not on the insurance. average salary earned by the insured immediately before he became disabled but on his earnings over a much longer period (in Germany, his entire working Article 45 (1) is concerned with the life). aggregation of periods completed in another Member State and with the use of an insurance fiction. The first situation arises in the case of a worker employed in Germany and in France, Β — Function and interpretation of when the disability occurs under the Article 47 (1) in conjunction with French risk scheme but the German Article 46 (2) of Regulation No insurance periods must also be taken into 1408/71 account in calculating the waiting period. The second situation arises in the case of a worker employed in France and in Germany when, so as to entitle him to Article 40 (1) provides that "an benefits in France, the disability which employed or self-employed person who occurred in Germany is deemed to have has been successively or alternately occurred in France. subject to the legislation of two or more Member States, of which at least one is" an endowment scheme "shall receive benefits under the provisions of Chapter Article 45 (3) deals with a situation 3 [old-age and death], which shall apply relating specifically to the Netherlands by analogy, taking into account the risk scheme. provisions of paragraph 3".

In order to apply that principle it (a) The worker fulfils all the conditions is however necessary to distinguish entitling him to benefit under the between cases in which the right to risk scheme, without having to have benefits under the risk system is based on recourse to the provisions of Regu- the aggregation of insurance periods and lation No 1408/71. In this case he those in which it is based on a legal receives the full benefit without any fiction. pro rata reduction. The only possible reduction in the benefit would be as a result of the application of national If the right to benefits is based on a legal rules against the overlapping of fiction the reference period, that is to say benefits. the period immediately before the claimant became incapacitated, will in all likelihood not have been completed (b) The worker who is insured under the under the risk scheme. In that case, to risk scheme when he becomes apply Article 47 (1) and take into disabled but can only fulfil the account only insurance periods com- waiting period requirement if pleted under that scheme in calculating insurance periods or periods of the daily wage would imply taking into residence in another Member State account periods outside the reference are taken into account (Article 45 (1) period. In view of what has already been of Regulation No 1408/71) is said about the purpose of risk schemes, entitled to a pro rata benefit under that would be in flagrant contradiction the scheme. with the structure and principles of these schemes, which include the Netherlands WAO. It is therefore also incompatible (c) The worker is no longer insured with the principle laid down in the last under the risk scheme when he sentence of Article 46 (2) (a), which, for becomes disabled and can claim the calculation of the theoretical amount, benefits under the scheme only by refers to the calculation of the amount of relying on the fictitious insurance benefit under national law. provided for in Article 40 (3) and Article 45 of Regulation No 1408/71. He is entitled to a pro rata If, on the other hand, the entitlement to benefit. benefit under the risk scheme is based on the aggregation of insurance periods and not on a legal fiction, the application of This last situation is that in which the Article 47 (1) is perfectly consistent with plaintiff in the main proceedings finds the structure and objective of the system. himself. In such a case the disability arises at a With regard to the interpretation of time when the insured person is subject Article 47 (1) of the regulation, the to the risk scheme but does not fulfil Commission takes the view that the the national conditions concerning the provision, in conjunction with Article 40 waiting period; this usually means that

The object of Article 47 of Regulation No 1408/71 is to provide a simplified method of calculation, owing to the Thus the effect of Regulation No administrative and practical difficulties 1408/71, which because of "fictitious which the institution may encounter insurance" gives migrant workers the when it must also take into account the benefit of insurance under the WAO wages earned by a claimant while subject even though they were not insured under to the legislation of another Member that legislation at the time of suffering a State. long-term disability, is not different.

According to the Commission, this interpretation cannot be regarded as Ill — Oral procedure forbidding insurance institutions, in calculating loss of wages due to long- term disability, from taking into At the sitting on 5 July 1984 oral consideration wages earned by the argument was presented for the Nieu­ claimant while he was insured in another we Algemene Bedrijfsvereniging, by Member State. The need for ad­ F. W. M. Keunen, acting as Agent, and ministrative simplification can in no case for the Commission of the European prevail over the fundamental purpose of Communities, by. F. Herbert, of the risk schemes. Brussels Bar.

The Advocate General delivered his In conclusion the Commission points out opinion at the sitting on 25 October that its position, as set out above, does 1984.

JUDGMENT OF 29. 11. 1984 — CASE 181/83

Decision

ι By an order dated 15 August 1983, which was received at the Court on 24 August 1983, the Centrale Raad van Beroep [Court of last instance in social security matters], Utrecht, referred to the Court for a preliminary ruling under Article 177 of the EEC Treaty three questions on the interpret­ ation of Regulation (EEC) N o 1408/71 of the Council of 14 June 1971 on the application of social security schemes to employed persons and their families moving within the Community (Official Journal, English Special Edition 1971 (II), p. 416).

7 The defendant took the view that the occupation of surveyor's assistant, in which the plaintiff was last engaged in the Federal Republic of Germany, should be regarded as his usual occupation; accordingly; it calculated the benefit by reference to the wage received in that occupation. The plaintiff disagreed with that method of calculation and brought an action against the defendant's decision, maintaining that, under Article 47 (1) of Regulation No 1408/71, in the circumstances specified in subparagraphs (a) to (d), the competent institution of a Member State must calculate the theoretical amount referred to in Article 46 (2) on the basis of the wages earned during the insurance periods completed under the legislation of the Member State in question, that is to say, in the present instance, the Netherlands.

s The Centrale Raad van Beroep, to which the case came on appeal, took the view that its decision depended on the interpretation of the Community regu­ lation; it therefore referred the following preliminary questions to the Court:

" 1 . Are the provisions of Article 47 (1) of Regulation N o 1408/71 also applicable in cases in which the second sentence of Article 46 (2) (a) of the regulation applies?

2. If so, must subparagraph (a) and/or subparagraph (b) of Article 47 (1) of Regulation N o 1408/71, having regard to their wording and their purpose, be interpreted as applying to a scheme relating to invalidity benefits which :

\ (a) is a risk scheme;

JUDGMENT OF 29. 11. 1984 — CASE 181/83

io Article 40 (1) of the regulation provides as follows: "A worker who has been successively or alternately subject to the legislations of two or more Member States, of which at least one is not of the type referred to in Article 37 (1), shall receive benefits under the provisions of Chapter 3, which shall apply by analogy, taking into account the provisions of paragraph 3."

n That provision is therefore applicable in this instance.

WEBER ν NIEUWE ALGEMENE BEDRIJFSVERENIGING

u Article 47 (1) lays down special rules which apply to the particular cases envisaged therein. The rule in subparagraph (a) applies in a case where, under the legislation of a Member State, benefits are calculated on the basis of average earnings, an average contribution, an average increase or on the ratio which existed, during the insurance periods, between the claimant's gross earnings and the average gross earnings of all insured persons other than apprentices. The rule in subparagraph (b) applies in cases where the legislation provides that benefits are to be calculated on the basis of the amount of earnings, contributions or increases, and where periods of insurance or residence in another Member State are taken into account. The rule in subparagraph (c) applies in cases where the legislation provides that benefits are to be calculated on the basis of standard earnings or a fixed amount. The rule in subparagraph (d) applies in cases where the legislation provides that benefits are to be calculated, for some periods, on the basis of the amount of earnings and, for other periods, on the basis of standard earnings or a fixed amount.

is None of those rules deals with a system of disability benefits such as the one described by the second question, namely a system under which the amount

JUDGMENT OF 29. 11. 1984 — CASE 181/83

of benefit is unrelated to the length of the insurance periods and which, for the purpose of calculating the loss of earnings, is based primarily on the wage received in the usual occupation of the person concerned and, in that connection, takes into account either the last fixed wage received by that person in that occupation before he became incapacitated for work or the average wage received by him during a specific period (not more than two years before he became incapacitated for work). It follows that, as the wording of Article 46 (2) (a) itself indicates, the theoretical amount is to be calculated solely in accordance with the legislation administered by the national institution.

On those grounds,

T H E C O U R T (First Chamber),

in answer to the questions referred to it by the Centrale Raad van Beroep, by an order dated 9 August 1983, hereby rules as follows:

The cases envisaged by Article 47 (1) of Regulation No 1408/71 do not include the case of a system of disability benefits under which the amount of benefit does not depend on the length of the insurance periods completed and which, for the calculation of the loss of earnings, is based primarily on the wage received in the usual occupation of the person concerned and, in that connection, takes into account either the last fixed wage received by him in that occupation before he became incap­ acitated for work or the average wage received by him during a specific period (not more than two years before he became incapacitated for work).

B o s c o O'Keeffe Koopmans

Delivered in open court in Luxembourg on 29 November 1984.