C-287/86

Mr President, waitress at a wage of DKR 195 per day plus Members of the Court, a percentage of the takings. The employment relationship was to run until 1 September 1983, and was renewable, but on 1. Arbejdsretten (Labour Court), 19 August Mrs Hansen failed to report for Copenhagen, has requested the Court to work and thus terminated the relationship. interpret Council Directive 77/187 of 14 February 1977 on the safeguarding of employees' rights in the event of transfers of undertakings (Official Journal 1977, L 6 1 , Subsequently, Landsorganisationen i p. 26) in order to determine whether the Danmark (Danish Trades Union Congress) directive protects employees who are not ascertained that the wage paid to Mrs employed by the undertaking at the time of Hansen did not correspond to the amount its transfer. The dispute before Arbejd- due under the collective agreement and so it sretten contains two unusual elements: the brought an action against Mrs Hannibalsen subject-matter of the transfer to which it for the difference before Arbejdsretten, relates is a tavern which is open for only a Copenhagen. Landsorganisationen i few months each year and the transfer was Danmark maintained that under the Danish made following the rescission of a lease of legislation concerning the transfer of under- the undertaking on the ground of a breach takings the agreement concluded in 1980 of the lessee's obligations. between Mrs Larsen and the Hotel- og Restaurationspersonalets Samvirke was binding on the owner and present operator In 1980 Ella Marie Hannibalsen let the N y of the Ny Mølle tavern, so that the Mølle Kro, which she owned, to Inger provisions of that collective agreement were Larsen. A few months later Mrs Larsen applicable. Mrs Hannibalsen denied that the concluded an agreement with the Hotel- og agreement, of which she was unaware, Restaurationspersonalets Samvirke (Asso- could be pleaded against her. ciation of Hotel and Restaurant Employees) whereby she undertook to comply with the terms of the collective agreements concluded by the association and Arbejds- Arbejdsretten took the view that an inter- giverforeningen af Hoteller og Restauranter pretation of Directive 77/187 was needed in (Federation of Hotel and Restaurant order for it to give judgment; consequently, Employers) in respect of those of her on 12 November 1986, it referred the employees who were members of the asso- following questions to the Court of Justice ciation. At the beginning of 1981 Mrs for a preliminary ruling: Larsen committed a breach of the lease; Mrs Hannibalsen rescinded the lease and took over the operation of the restaurant, which she opened, as a general rule, during the summer season. In May 1983 Mrs '(1) Do the words " t r a n s f e r . . . to another Hannibalsen engaged Ketty Hansen as a employer as a result of a legal transfer

or merger" in Article 1 (1) of Directive main proceedings and in the questions 77/187/EEC cover the situation in referred to the Court. Law N o 111 of 21 which the owner of a leased under- March 1979, by which Denmark gave effect taking rescinds the lease on the ground to Directive 77/187, defines its own scope of breach by the lessee and carries on by indirect reference to the relevant the business himself? provisions of the directive, that is to say to Article 3 (1) and to Article 1 (1). Article 3 (1) provides that the transferor's rights and obligations 'arising from a contract of employment or from an employment (2) Does the directive apply where the relationship existing on the date of a transferred undertaking was tempo- t r a n s f e r . . . shall, by reason of such transfer, rarily closed at the time of the transfer be transferred to the transferee'. Article 1 and consequently employed no staff? (1) provides that the directive 'shall apply to the transfer of an undertaking, business or part of a business to another employer as a result of a legal transfer or merger'. (3) Is it material to the answer to question (2) that the undertaking transferred is regularly closed for part of the year, as in the csae of a hotel, a boarding house Finally, Article 3 (2) provides as follows: or a restaurant which is open only 'Following the transfer . . . , the transferee during the summer? shall continue to observe the terms and conditions agreed in any collective agreement on the same terms applicable to the transferor under that agreement, until the date of termination or expiry of the (4) Must Article 3 (2) of the directive be collective agreement'. interpreted as meaning that the transferee must continue to observe the terms of a collective agreement binding the transferor regarding pay and 3. With the sole exception of Dansk working conditions, even if at the time Arbejdsgiverforening, the interveners in the of the transfer the undertaking had no case state that the first question should be employees?' answered in the affirmative. I am also of that opinion; however, unlike the Commission and the United Kingdom, I do not draw that conclusion from the wording Written submissions were made to the of Article 1 (1). Court in this case by Landsorganisationen i Danmark, Dansk Arbejdsgiverforening (Danish Employers' Association), the As the Court stated in paragraph 11 of its Commission of the European Communities judgment of 7 February 1985 in Case and the United Kingdom. The first three 135/83 Abels v Bedrijfsvereniging voor de also made submissions at the hearing. Metaalindustrie en de Electrotechnische Industrie [1985] ECR 469, the wording is not decisive because whilst some language versions of the provision use the expression 2. I shall begin with a brief reference to the 'cessione contrattuale' others — the English provisions referred to in the course of the and Danish versions — use more general

Such an interpretation — which in fact puts the emphasis of the provision on the non-technical term 'transfer' and regards 4. The second and third questions, which the case of a legal transfer and that of a seek to ascertain whether the directive merger as examples — is completely applies to an undertaking which is trans- consistent with the spirit and purpose of the ferred at a time when it is closed and directive. In a recent decision (judgment of therefore has no employees and whether it 18 March 1986 in Case 24/85 Spijkers v is material that the business is of a seasonal Gebroeders Benedik Abatoir CV and Alfred nature, may be dealt with together. Benedik en Zonen ÆV [1986] ECR 1119, at paragraph 15) the Court stated that the purpose of the Community legislation was 'to ensure the continuity of employment relationships existing within a business, irrespective of any change of ownership'. Once again Dansk Arbejdsgiverforening The Court added that it follows that 'the takes a more restrictive position. In its decisive criterion for establishing whether opinion the closure of the business and the there is a transfer . . . is whether the business resulting absence of employees at the time in question retains its identity'. of the transfer are sufficient to preclude the operation of the principle laid down in Article 3 (1), and although there is some risk that such a conclusion might permit evasion of the protection provided for by the directive (for example, if the closure is In other words, the purpose of the directive of brief duration and the undertaking is to render irrelevant any changes in reopens with the same staff), such a danger ownership of (or, more generally, title to) does not exist in the case of seasonal under- an undertaking as regards employment takings which take on staff only for the relationships existing within it. Whatever the months in which they are open. The other nature of the transaction, the transfer must interveners take the opposite view. They all

maintain, whether firmly or with qualifi- by engaging employees for a specific period. cations, that the decisive factor is not the It is clear that the protection provided by absence of employees but the continuity or Community law does not extend to the transience of their employment relationship, latter. In my opinion that is so even if those and that the fact that the undertaking is employees expect, on the basis of past regularly closed for part of the year does experience, that they will be re-engaged at not automatically imply the termination of the beginning of each season.

Similarly, it is In other words, the directive applies to for that court to determine whether the workers who, on the date of the transfer, creation of a series of employment are employed by the transferor. If there are relationships of specific duration separated such workers the obligations owed to them by short intervals constitutes evasion of the by the transferor are transferred to the law and whether the closure of the under- transferee and may be relied upon against taking is, in the first place, seasonal or him; if there are none the transferee is free exceptional and, secondly, a normal thing of any obligation whatsoever. The fact that or a symptom of an irreversible crisis. the undertaking was closed and conse- quently no employees were actually working, that is to say physically present, may therefore constitute a factor to be taken into account in determining whether the business 5. At this point the reply to the final was a going concern or was on the point of question is clear. As we have seen, the scope disappearing from the market.

There are agreement', Article 3 (2) does not extend undertakings in the business world which the range of persons to whom the directive guarantee their employees continuity of is applicable but merely confirms the employment even though they are employed continuity solely of employment only during the period in which the business relationships existing at the time of the is carried on and there are undertakings transfer, with regard to the rights which which satisfy their operational requirements workers derive from agreements concluded by trade unions.

(4) Article 3 (2) of Directive 77/187 must be interpreted as meaning that the transferee must continue to observe the terms of a collective agreement binding on the transferor regarding working conditions and pay only with regard to workers in the employ of the transferor at the time when the under- taking was transferred.'