C-322/98

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OPINION OF MR SAGGIO — CASE C-322/98

practice disadvantages a substantially from among his employees whose posts are higher proportion of the members of one comparable the employee to whom loss of sex unless that provision, criterion or employment will cause least harm ('selec- practice is appropriate and necessary and tion on the basis of social criteria'). can be justified by objective factors unre- lated to sex'.

5. The KSchG does not explain what is meant by comparable posts for purposes of selection on the basis of social criteria. However, according to the order for refer- The relevant provisions of national law ence, the case-law of the Bundesarbeitsger- icht (the Federal Labour Court; hereinafter the 'BAG') makes it clear that in general the comparability of two posts must be assessed on the basis of the substantive 4. In this case, the relevant national provi- content of the employment contract and sions are contained in the Kündi- therefore of the characteristics of the job gungsschutzgesetz (Law on Employment performed. For this purpose, absolute simi- Protection) (hereinafter 'the KSchG'). Arti- larity is not necessary and it is enough if the cles 1(1) and (2) of that law states that the duties, although different, are at any rate dismissal of any employee who has been equivalent. Consequently, two posts will be employed without interruption for over six deemed comparable if, by virtue of his right months with the same company shall be to organise the business of his company, the ineffective if it is socially unjustified, in employer is able to assign either of the two other words if the reason for the dismissal employees to the other's other post without is not connected with the person or conduct amending their employment contracts. of the employee, or with constraints that BAG case-law consequently also establishes severely limit the company's freedom of that full-time and part-time employees action, making it necessary to eliminate a cannot be considered comparable because particular post. The latter case constitutes transformation of a part-time working 'dismissal on economic grounds'. relationship into a full-time relationship (or vice versa) in any event involves amend- ment of the contract.

ever, the plaintiff stated, and was not 8. As a result of the reduction in its contradicted, that recently the BAG had international work, the Bankhaus decided delivered two judgments on this question. to merge the section in which the plaintiff According to those judgments, if a part- worked with the larger documentary credit time post is eliminated, full-time employees section. It consequently decided to reduce must be taken into consideration for the the number of its employees and therefore purposes of the selection on the basis of in a letter dated 21 June 1996 gave the social criteria if the employer's sole purpose plaintiff notice of her dismissal on eco- in eliminating that post was to reduce the nomic grounds with effect from 30 Sep- total number of hours worked, but those tember 1996. same employees should not be included if the elimination is the result of a decision taken by the employer to use only full-time workers for specific jobs, that is to say, a decision relating to the organisation of the company dictated, as such, by criteria relating to operating costs. In the latter case, the employer's decision must be deemed to be an expression of his right to 9. At that time the Hamburg branch of the organise his own business and therefore Bankhaus had five part-time employees, cannot be subject to any form of control, three of whom were men and two women, unless this is clearly incorrect, unreasonable and 22 full-time employees, ten of whom or arbitrary. were men and ten women. The second group included Ms Grabbert, who had been working for five months in the credit section.

12. The plaintiff appealed against the judg- 'Is Article 5(1) of Directive 76/207/EEC to ment of the Arbeitsgericht to the Land- be interpreted as meaning that, when esarbeitsgericht Hamburg (Higher Labour applying Paragraph 1(3) of the KSchG Court, Hamburg). That court upheld the (Law on Employment Protection) — in this contested judgment while recognising that case the version in force until 30 September the Bankhaus employs a full-time 1996 — part-time female employees are to employee, other than the plaintiff, who be regarded as comparable to male and performs duties comparable with those female full-time employees when selecting performed by the plaintiff herself, and employees for dismissal according to social stated that, according to the social criteria criteria if substantially more women than defined in the KSchG, the plaintiff had to men are employed on a part-time basis in a be regarded as in greater need of protection particular sector?' than the full-time worker. Furthermore, the Landesarbeitsgericht confirmed that, in the light of current case-law,2 full-time and part-time employees cannot be considered comparable for the purposes of selection on the basis of social criteria because in order to transform either employment relation- ship into the other amendment of the employment contract is necessary. How- Admissibility ever, the Landesarbeitsgericht also added that if the only reason for considering that the plaintiff is not comparable with Ms Grabbert is that she has so far been employed on a part-time basis, her dismis- 1 4 . The G e r m a n G o v e r n m e n t has sal might constitute indirect discrimination expressed its doubts as to the admissibility of the reference for a preliminary ruling, arguing that Article 5(1) of the Directive on 2 — See paragraph 6 of this Opinion. the implementation of the principle of

equal treatment for men and women as material necessary to give a useful answer regards access to employment, vocational to the questions submitted'. 4 training and promotion, and working con- ditions, including those relating to dismis- sal, is totally irrelevant for the purpose of resolving the dispute in the main proceed- ings inasmuch as the selection according to social criteria prescribed by Article 1(3) of the KSchG concerns two workers of the same sex and more specifically two women. 16. If these criteria are applied, it does not seem to me that it can be said that in this instance the answer to the question is clearly irrelevant to the decision on the dispute before the national court. In fact, it must be considered that the question is directed to the possible discriminatory effects resulting, in general, from the appli- cation of the German Law on employment 15. That argument claim is unfounded. It protection. As we have seen, the Directive must first be borne in mind that, in general, implements in the Member States, in regard the purpose of a reference for a preliminary to employment relationships, the funda- ruling is to 'supply all courts in the mental principle that there should be no Community with the information on the discrimination on grounds of sex. It there- interpretation of Community law which is fore seems clear to me that compliance with necessary to enable them to settle genuine this principle cannot fail to influence the disputes which are brought before them' 3 correct application of the relevant national and that for this co-operation between legislation and that therefore a ruling on national courts and the Community court the scope of the Community principle, with to function, there must be a separation of reference to the equal treatment of workers the duties of those two categories of court without distinction as to sex at the time of which, according to consistent case-law, dismissal, must be considered helpful for means that 'it is solely for the national the assessments to be made by the national court hearing the case, which must assume court. responsibility for the subsequent judicial decision, to determine, in particular, the need for a preliminary ruling in order to enable it to deliver judgment'. Using this as a basis, the Court concluded that it 'may refuse a request made by such a court only where it is quite obvious that the interpre- tation of Community law sought bears no relation to the actual facts of the main 17. The German Government also claims proceedings or their purpose, or where it that the facts stated by the national court in does not have before it the factual or legal the order for reference are inadequate for

18. Finally, at the hearing it was asserted 20. The national court asks whether Arti- that the reference for a preliminary ruling cles 2 and 5(1) of the Directive, which had become superfluous as a result of a prohibit any direct or indirect discrimina- recent decision of the BAG laying down the tion in working conditions, constitute an criteria according to which full-time and obstacle to the application of Article 1(3) part-time workers are to be compared for of the German Law on employment pro- the purpose of selection on the basis of tection, which holds full-time workers not social criteria. 5 That assertion is also to be comparable with part-time workers unfounded. It must be borne in mind that, for the purposes of the 'selection on the as the Commission has stated, the need to basis of social criteria' that the employer is ensure legal certainty is as a rule enough to required to make if a part-time post is justify the intervention of the Court of eliminated in order to reduce operating Justice 6 ; furthermore, if the national court, costs. which must be assumed to be acquainted with the new German case-law, has not withdrawn its request, it is reasonable to assume that it still considers that a reply is necessary for the resolution of the dispute in the main proceedings.

21. The abovementioned German provi- sions clearly do not give rise to any form of direct discrimination between workers for the simple reason that the comparability 19. On the basis of the foregoing consid- criteria it lays down do not take account of erations, I consider that the question re- any distinctions based on sex. This of course does not rule out, at least theoreti- cally, the possibility that it might give rise 5 — See paragraph 7 of this Opinion. to some form of indirect discrimination. 6 — Case 146/73 Rheinmühlen Düsseldorf v Einfuhr- und And this is essentially what the national Vorratsstelle für Getreide und Futtermittel [1974] ECR 139, paragraph 3. court is asking this Court to determine.

23. As regards the category of part-time 24. In the Botel judgment 9 the Court workers, it is not hard to see that that considered legislation similar to that at category is characterised by a clear predo- issue in this case, in other words a case in minance of women, with the result that any which the discriminatory effects resulting unfavourable treatment of it almost auto- from the application of formally neutral matically translates into discrimination on national legislation to specific situations, grounds of sex. The Court has hitherto had and held that such effects are incompatible occasion to rule in cases in which the with the principle of equality where they unfavourable treatment suffered by women give rise to a different treatment of part- as a result of legislation that directly time workers that penalises them, treat- discriminated against part-time employ- ment which, in its turn, entails, at least as a ment, 8 and has considered that the rule, discrimination on grounds of sex. In national provisions gave rise to indirect point in the case examined by the Court discrimination against women and direct was national legislation by virtue of which discrimination against part-time employ- the members of a works council who took ment. part in the training courses necessary for performance of the council's specific duties were to be absolved from their employment duties without any reduction in salary. The Court held that such legislation entailed discrimination against part-time workers (and therefore women) because the length In this case, however, the discrimination of the training courses exceeded the indivi- against part-time workers is, once again, dual working hours of the various part- time employees, with the result that for the hours they spent on the course they 7 — C a s e C - 1 8 9 / 9 1 Kirsammer-Hack v Sidal [1993] received less than the compensation paid, ECR I-6185, paragraph 22. See also C-100/95 Kording v for the same reason, to full-time workers. Senator für Finanzen [1997] ECR I-5289, paragraph 30; C-167/97 Seymour-Smith and Perez [1999] ECR I-623, paragraph 52; and C-50/96 Deutsche Telekom v Schröder 2000] ECR I-743, paragraph 28. 8 — See, particularly as regards equal pay, Case 170/84 Bilka v 9 — Case C-360/90 Arbeiterwohlfahrt der Stadt Berlin v Botel Weber von Hartz [1986] ECR 1607; C-33/89 Kowalska v [1992] ECR I-3589. See also, Case C-457/93 Kuratorium Freie und Hansestadt Hamburg [1990] ECR 2591 and für Dialyse und Nierentransplantation v Lewark [19961 C-184/89 Nimz v Freie und Hansestadt Hamburg [1991] ECR I-243; and Case C-278/93 Freers and Speckmann v ECR 297. Deutsche Bundespost [1996] ECR I-1165.

25. The German legislation in point today that consequently they alone will suffer the provides that an employer, when he decides harmful effects of the elimination of that to eliminate a post in order to reduce post: the social circumstances of those operating costs, is obliged to select, accord- workers, even where workers more disad- ing to social criteria, the worker who will vantaged than full-time workers are con- have to be dismissed and must make that cerned, will be assessed by comparison only selection from among comparable workers. with other part-time workers, thus limiting In so doing, he must ensure that he selects the employment protection afforded under the worker who, in comparative terms, will the German law. Consequently, if, among suffer the least harm from dismissal. This the part-time workers, there are substan- makes it necessary to establish the cate- tially more women than men, the number gories of worker between which the com- of male workers taken into account for the parison must be made. purpose of the selection according to social criteria will necessarily be lower, with the further consequence that adequate protec- tion for the purposes of retention of the post will not be guaranteed to women workers who are particularly disadvan- taged and who therefore need such special protection. As I have already mentioned, the German courts, when interpreting the concept of comparability, have stated that it applies only when the employer can move workers from one post to another without also having to make changes to their contracts of employment. This obviously supposes that the employment relationship is sub- stantively the same and that therefore comparison between part-time and full- 26. The Bankhaus disputes this analysis. It time workers is excluded. The same courts maintains that in reality, in the present have observed that the transfer of a part- case, the application of the national legisla- time worker to a full-time post (and vice tion disadvantages neither full-time nor versa) entails amendment of the contract of part-time employees in any way because, employment as these two categories of on the one hand, in the event of elimination worker are not comparable. of a part-time post, full-time workers are not taken into consideration when selecting an employee for dismissal on the basis of social criteria and therefore they do not run the risk of dismissal, and on the other hand, in the event of elimination of a full-time post, part-time workers would not rank among the workers who would be dis- It follows, in my opinion that, if a part-time missed. According to the Bankhaus, this post is eliminated, the only situations that proves that in reality not only the legisla- can be considered and compared, for the tion but also its application are as a whole purposes of selection on the basis of social neutral in that the situations of disadvan- criteria, are those of part-time workers and tage which arise according to whether the

27. Now that it is found that the German legislation in point gives rise to unequal treatment, to the detriment of part-time workers, it is necessary to establish if, and 29. I consider that the national court's under what conditions, this inequality gives proposal should be followed. It makes no rise, if only potentially, to discrimination sense to refer to the part-time workers on grounds of sex. In order to do this, it is employed in the undertaking in order to necessary to identify the reference group of determine whether there are substantially workers, that is, the group of workers to be more women than men workers. It must be taken into consideration in order to estab- considered that the situation of a particular lish if there is a disproportion between the undertaking, particularly if of limited size, numbers of men and women employees. may not be significant for the purpose of On this point the parties put forward inferring from the percentage of women in opposing arguments. part-time employment in that undertaking that there is indirect discrimination against women as a result of the (social) choice to dismiss a woman following elimination of a part-time post. It also does not seem reasonable to me to refer to the totality of part-time workers in a Member State, since 28. The Bankhaus and the German Gov- working arrangements and employment ernment maintain that the reference group problems usually have features that vary for establishing whether any disproportion from sector to sector; and this state of exists must be that of the part-time workers affairs cannot be ignored when, following employed in the undertaking and that the elimination of a post, the employer has consequently in this case there can be no recourse to 'selection according to social discriminatory effect to the detriment of the criteria'. On the other hand, I find it plaintiff since, at the time of her dismissal, reasonable, precisely because of the last- the Bankhaus employed five part-time mentioned consideration, to refer to part- workers, of whom three were women and time employees in the sector to which the two men. The plaintiff, on the other hand, undertaking that has eliminated a part-time maintains that in order to establish whether post belongs. This means that the difference the national legislation gives rise to discri- in treatment between part-time and full-

32. As the Commission points out, the order for reference does not expressly indicate any possible justification for the disparity in treatment as between part-time 30. However, if such a situation exists, it is and full-time workers as a result of the still necessary to consider a final factor, application of the German legislation on namely whether the disparity in treatment selection according to social criteria. As I as between the two categories of worker have already said, the national court merely can be regarded as justified for objective states that, according to the case-law of the reasons unrelated to any discrimination of BAG, two posts cannot as a rule be deemed ground of sex, in other words, whether the comparable if the transfer of a worker from application of the national legislation pur- one to another would involve amendment sues objectives that justify the different of the employment contract and that, since treatment and whether the means used to changing a part-time post into a full-time achieve them are necessary and not dispro- post (or vice versa) requires amendment of portionate. the contract, there can be no comparability between full-time and part-time workers in the context of selection according to social criteria.

31. In this regard, it should first be observed that it is now settled case-law that 'it is ultimately for the national court, which has sole jurisdiction to assess the 33. It does not seem to me that these facts and interpret the national legislation, considerations can suffice to justify a to determine whether and to what extent a legislative provision, which, though apply- ing independently of the sex of the worker, 10 — Judgment in Seymour-Smith and Perez, cited above, actually affects a considerably higher per- paragraphs 68 and 69. See also judgment in Freers and Speckmann v Deutsche Bundespost, cited above, para- centage of women than men, can be graph 24 and Case C-328/91 Secretary of State for Social Security v Thomas and Others [1993] ECR I-1247, justified by objective factors unrelated to paragraph 13.

difference in treatment between the two Second, both where transformation of the categories of worker. contract of employment is unavoidable and where no amendment is necessary to enable the part-time employee to take the post of the full-time employee, the comparability of the two categories of worker must in the context of selection according to social criteria be assessed in relation to the conflict of interests that will inevitably First, it must be borne in mind that the exist between, on the one hand, the application of the national legislation in the employer's right to organise work within light of the case-law cited above means that his business as he wishes and, on the other, the exclusion of full-time workers from the the right of part-time workers (and there- selection according to social criteria is fore of women) not to suffer discrimina- effected automatically and in a generalised tion. As between those two interests it is way, on the basis of the presumption that necessary to ascertain, on a case-by-case the difference in working hours excludes basis, which is the weightier and, as such, always and in any event the possibility for a deserving of greater protection. 12 There is part-time worker to take the post of a full- no need even to add that identification of time worker, which would make it neces- the prevailing interest, since it is linked to sary for their contracts of employment to the ascertainment of the specific circum- be amended and their employment relation- stances of each case, is a matter exclusively ship to be transformed.

without affecting work efficiency. The need [2000] ECR I-929, the Court, referring to the compar- ability of the exclusion of part-time workers from an to amend the contract of employment must occupational retirement pension scheme with the principle be assessed, case by case, in the light of the of equal pay for men and women, and therefore in a context different from that in this case, stated that 'the facts. economic aim pursued by Article 119 of the Treaty, namely the elimination of distortions of competition between undertakings established in different Member States, is secondary to the social aim pursued by the same provision, which constitutes the expression of a funda- 11 —Case C-1/95 Cerster v Freistaat Bayern [1997] mental human right'.

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lowing the elimination of a part-time post employer's freedom that is disproportion- can be justified only if the national court ate in relation to the objective of the finds that, in the light of the facts, the two protection of part-time workers, which as categories of worker cannot be compared a rule is regarded as of paramount impor- except at the cost of a limitation on the tance.

Conclusions

34. In the light of the aforementioned considerations, I propose that the Court reply to the question referred by the Landesarbeitsgericht Hamburg, Germany, as follows: