C-165/01

BETRIEBSRAT DER VERTRETUNG DER EUROPÄISCHEN KOMMISSION IN ÖSTERREICH

OPINION OF ADVOCATE GENERAL GEELHOED delivered on 10 April 2003 1

I — Introduction II — Legal framework

A — Provisions of Community law on the representation of and co-determination by 1. By the two questions which it has the staff of the institutions referred for a preliminary ruling the Oberster Gerichtshof (Supreme Court) (Austria) seeks essentially to ascertain the extent to which provisions of national labour law, in this case the provisions of the Arbeitsverfassungsgesetz (Labour Con- stitution Act, hereinafter 'the ArbVG') on labour relations in undertakings — which provide for a works council to be set up in all undertakings in which more than five 2. Articles 2 and 3 of Regulation (EEC, workers entitled to vote are employed — Euratom, ECSC) No 259/68 of the Council apply as a 'condition of employment' to of 29 February 1968 laying down the Staff local staff serving in the representation of Regulations of Officials and the Conditions the European Commission in Vienna. More of Employment of Other Servants of the specifically, the substantive issue in this European Communities and instituting connection is whether the applicable Com- special measures temporarily applicable to munity provisions on co-determination by officials of the Commission 2 form the basis local staff employed at a representation of of the Staff Regulations of Officials of the the European Commission apply exclus- EC (hereinafter 'the Staff Regulations') and ively or whether there is latitude for of the Conditions of Employment of Other parallel or supplementary application of Servants of the European Communities national rules such as those laid down in (hereinafter 'the Conditions of Employ- the ArbVG on the same subject. ment').

6. Under Article 9(3) of the Staff Regu- 'There shall be set up: lations the task of the Staff Committee is to represent the interests of the staff vis-à-vis their institution and maintain continuous contact between the institution and the staff. It also contributes to the smooth running of the service by providing a (a) within each institution: channel for the expression of opinion by the staff. More particularly, the Committee brings to the notice of the competent bodies of the institution any difficulty having general implications concerning the inter- pretation and application of the Staff — a Staff Committee, which may be Regulations and submits to the competent organised in sections for the different institution suggestions concerning the places of employment; organisation and operation of the service and proposals for the improvement of staff working conditions or general living con- ditions. Finally, the Committee has the task of participating in the management and supervision of social welfare bodies set up — one or more Joint Committees...; by the institution in the interests of its staff. I - 7686

BETRIEBSTAR DEU VERTRETUNG DER EUROPÄISCHEN KOMMISSION IN ÖSTERREICH

11. These categories of servants are defined in more detail in subsequent provisions. Article 4 of the Conditions of Employment specifies what is to be understood by 'local 8. On the basis of the scheme laid down in staff'. Article 9 of the Staff Regulations and Annex II to the Staff Regulations, the Commission's Staff Committee consists of a Central Committee and local sections corresponding to the various places where Commission staff are appointed. The members of the Central Committee are 'For the purposes of these conditions of appointed from the local sections. The employment, "local staff" means staff members of the local sections are elected engaged according to local practice for by the officials and the other servants manual or service duties, assigned to a post within the meaning of Article 7 of the not included in the list of posts appended to Conditions of Employment. Officials who the section of the budget relating to each are not members of a local section are institution and paid from the total appro- represented by the local section in Brussels. priations for the purpose under that section Since there is no local section for the staff of the budget. By way of exception, staff appointed in Vienna, those officials and engaged to perform executive duties at the servants are represented by the Brussels Press and Information Offices of the Com- section. They therefore participate in the mission of the European Communities may elections for that section. also be regarded as local staff.'

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(b) their leave, and

15. On 21 November 1989 the Framework rules laying down the conditions of employment of local staff of the Commis- (c) their remuneration sion of the European Communities serving I - 7688

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in non-member countries 3 (hereinafter 'the B — Relevant provisions of national law Framework rules on non-member coun- tries') were adopted on the basis of, in particular, Articles 4, 7, 79, 80 and 81 of the Conditions of Employment. Those rules entered into force on 1 January 1990 but 17. In Austria the term 'Arbeitsverf- did not become applicable until the entry assungsrecht' (labour relations law) is into force of the special conditions laid understood to mean that part of labour down for each employment location. law which concerns the organisation, task, powers and reciprocal relations (consul- tation and collective agreements) involved in the protection of the interests of the 16. The special conditions in respect of the workers within an establishment or across situation in Austria (hereinafter 'the special an industry, on the one hand, and the conditions for Austria') were adopted in protection of the interests of an individual 1994. The first article of those rules on the employer or employers across an industry, special conditions of employment for local on the other, and the embodiment of staff working in Austria reads — in its collective labour law by other bodies. German version — as follows:

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OPINION OF MR GEELHOED — CASE C-165/01

worker is affected by matters concerning lic or of the Länder on staff representation the establishment. The starting point of the apply to those bodies. The defendant is not ArbVG as regards labour relations in the expressly mentioned in that exemption workplace is the coexistence of two oppos- provision, nor is provision made in any ing groups of people (the employer and the other way for an exemption for an organi- staff) and it gives the staff various powers. sation as a defendant from the scope of Part II of the ArbVG.

BETRIEBSRAT DER VERTRETUNG DER EUROPÄISCHEN KOMMISSION IN ÖSTERREICH

val of measures under Paragraph 96a of the required for the introduction of systems for ArbVG may be replaced, under subpara- the automated collection, processing and graph (2) of that provision, by decisions of transfer of personal data on workers where an arbitration board. such data consists of more than general personal details and the transfer of that data is not necessary for business purposes. Approval is not required where the actual or proposed use of such data does not go beyond the fulfilment of obligations under the law, the rules of collective agreements or an employment contract. The works council must grant its approval in the form 24. Paragraph 97(1), points 1 to 6a, in of a (written) agreement. If the works conjunction with Paragraph 97(2) of the council and the employer do not reach ArbVG governs cases of 'enforceable co- agreement, the manager of the establish- determination' in which, in the absence of a ment may, under Paragraph 97, force a works agreement, it may be possible for a settlement through the arbitration board. If decision of an arbitration board to sub- the employer takes the measure without the stitute for the settlement sought, while in approval of the works council and without the cases of 'optional co-determination' recourse to the arbitration board, the referred to in Paragraph 97(1), points 7 to works council may bring an action for the 23a and 25 of the ArbVG, the settlement annulment of the measure which is invalid sought cannot be reached in the absence of in those circumstances. a works agreement.

31. At the end of October 1998 the works council wished to be informed about a 28. The Commission of the European monitoring device by means of which Communities has established a represen- personal data on workers were recorded tation in Austria (hereinafter 'the represen- and processed each time they entered the tation') which has the task of providing office using a card with a microchip in information on European matters. The staff conjunction with a code. Under Paragraph of that representation consists of Commis- 96a of the ArbVG the approval of the sion officials on the one hand and of local works council is required, as stated above, staff on the other. The dispute concerns for the introduction of systems for the only the latter group. automated collection, processing and transfer of personal data on workers where such data consists of more than general personal details and the transfer of that data is not necessary for business purposes. 29. On 12 March 1998 a works council By introducing the monitoring system con- was elected at the representation. Thus cerned without the approval required under Paragraph 40 of the ArbVG was imple- Paragraphs 91 and 96a of the ArbVG, the mented. The management of the represen- Commission acted unlawfully, according to tation was immediately informed of this the plaintiff, and the system must, in its election and of the creation of the works view, consequently be dismantled. council. The representation did not oppose the creation of that body. According to the order of the Oberster Gerichtshof and the written observations of the works council the chairman and the vice-chairman of the works council are viewed by the represen- tation as the local representatives of the local staff. 32. The plaintiff has therefore claimed before the national court that the defendant should be ordered to inform it which personal data on workers are being stored in the monitoring system and to whom those data are being transferred. The plain- 30. Around a year later, in February 1999, tiff has also claimed that the defendant elections were held to the Staff Committee should be ordered to dismantle all equip- I - 7692

ment for the recording of personal data on to the defendant. Nevertheless, the appeal workers unlawfully installed up to that court, proceeding on the basis of the date. Those claims were rejected both at primacy of Community law, pointed out first instance and on appeal. that there was an irreconcilable contra- diction between the Staff Regulations and the ArbVG on the issue of the capacity to be a party to legal proceedings. For thai- reason the capacity to be a party to legal proceedings which the works council derived from Paragraph 53(1) of the ASGG 33. The court at first instance pointed out could not be relied upon against the that the system of rules applicable to local European Communities. The appeal judge staff is laid down in regulations which are considered that principle to preclude the directly applicable in the national legal co-existence within the European Commu- system and take precedence over national nities of the Staff Committee under Article 9 legislation which is incompatible with of the Staff Regulations and employee them. It also took the view that the bodies with capacity to be a party to legal references to national law made in the proceedings within the meaning of Para- Community rules concerned could only graph 53(1) of the ASGG. relate to individual rights. Finally, he ruled that since Article 9 of the Staff Regulations provided for a form of staff representation, there was no latitude for parallel appli- cation of the ArbVG. The fact that the rules based on Article 9 of the Staff Regulations were not as comprehensive as those laid down in the ArbVG was irrelevant, in his view. He added that the fact that a provision needed to be improved could 35. In the appeal on a point of law the not justify failure to apply it. Rather, it Oberster Gerichtshof, proceeding on the entailed a duty on the part of the competent basis of the applicability, in principle, of legislative body to enact a better set of the ArbVG to the representation, found rules. that the parties disagreed on the signifi- cance and scope of Article 79 of the Conditions of Employment. Unlike the defendant, the plaintiff sees this provision as a comprehensive reference to the appli- cable national law, which, in view of the close connection between the law on 34. The appeal court found essentially that employment contracts and the law on both the Community rules and Austrian labour relations in the workplace, includes, law applied to the contractual relationship in the case of Austria, a reference to the between the local staff serving in Austria provisions of Part II of the ArbVG. The and the European Communities. Given that question also arises whether the provisions the scope of the ArbVG was determined by of the ArbVG are superseded by the rules in the principle of territoriality and the the Staff Regulations on staff represen- defendant therefore fell within the terms tation. The Oberster Gerichtshof therefore of that Act, the ArbVG applied in principle stayed the proceedings and referred the

(b) their leave, and 36. In accordance with Article 20 of the Protocol on the Statute of the Court of Justice, written observations have been submitted by the plaintiff (Betriebsrat) and the defendant (Commission) in the (c) their remuneration main action and by the German Govern- ment, the Austrian Government and the Swedish Government. On 11 February 2003 a hearing was held in this case at which the parties in the main action and the are to be determined by each institu- Swedish Government set out their positions tion in accordance with current rules in more detail. The Netherlands Govern- and practice in the place where they are ment also set out its position during that to perform their duties, to be under- hearing. stood as a reference to the relevant national law on employment, which, in the case of Austria, also requires the application of the law on labour relations in the workplace laid down in Part II of the Austrian Arbeitsver- fassungsgesetz (Labour Constitution 37. On 13 December 2002 the Court asked Act)? the Commission to answer the question, submitted in writing, whether the Frame- work rules on non-member countries and the special conditions for Austria remained in force after the accession of the Republic 2. Are the provisions of Article 9 of the of Austria to the European Union in Staff Regulations of the European relation to the situation of local staff I - 7694

BETRIEBSRAT DER VERTRETUNG DER EUROPAISCHEN KOMMISSION IN ÖSTERREICH

40. Before addressing the specific questions referred by the Oberster Gerichtshof, I would like to make a few remarks of a more general nature concerning the back- ground, rules and function of co-deter- mination in the management of an under- Introduction taking or organisation and the great variety of systems which exist in the Member States in this area. It is of great importance for the answer to these questions, in my view, that the subject of employee partici- pation in decision-making in undertakings 38. The purpose of the main action is and organisations is put in the correct essentially to have it recognised that the context. works council (Betriebsrat) can exercise the powers which it derives from the relevant provisions of Austrian employment law on co-determination vis-à-vis the Vienna rep- resentation of the Commission as well. To put it another way, can a service of the Commission which is established in another Member State be subject to the 41. Structures for co-determination have applicable law of that State on represen- developed in a rather fragmented way in tation, consultation and, where provision is the various Member States. This has to do made for this in national legislation, co- with the fact that the issue of the represen- determination by workers who, under tation of workers within an undertaking is Community law, have the status of local closely connected with industrial develop- staff? ment, and that this has taken different

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43. Of course I can only touch here on a few aspects of this wide field, but in my view what I have said above is sufficient to illustrate that the subject of co-deter- mination is an extremely varied one in 42. What is interesting about these deve- which national developments, traditions lopments is the philosophical basis on and cultures have had — and still which representation was established. have — a clear influence on the forms There is a distinction to be made between and gradations of co-determination that models in which the employer and the have been introduced. What appears to me worker participate on an equal footing in a to be of vital significance, however, is that the debate about those forms relates first and foremost to the organisation of the 5 — I obtained this information from the comparative study by Prof. Dr R. Blanpain, 'Information and consultation of undertaking itself. Worker co-deter- employees, A comparative overview', published in R. Blanpain, D. C. Buijs and J. J. M. Lamers, Medezeggen- schap op Europees niveau, De EU-Richtlijn van 22 September 1994, Deventer 1997, pp. 1 to 46. 6 — Ibid.

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45. Co-determination by workers must therefore be seen as a means to structure industrial relations within an undertaking 44. The same applies within the Commu- and as a means to share responsibility for nity, whereby I am not referring purely to the management of the undertaking. With a the internal rules which apply in respect of view to those ends the structure of the the Community's own staff, but also to the co-determination must be unitary in nature Community directives that have been and all the staff must be able to participate adopted on this subject and that have as on an equal footing. For this reason the their objective to stimulate dialogue rules on co-determination by workers are between labour and management. 7 The usually enshrined in legislation. It is against main idea in the case of the directive on the this background that the questions of the European Works Council is the equal Oberster Gerichtshof must be answered. treatment of employees of transnational undertakings with regard to information and consultation in the taking of decisions that may have (substantial) consequences for the interests of employees. The directive establishing a general framework for informing and consulting employees is designed to strengthen dialogue within The questions referred: two possible undertakings in order to improve risk approaches

7 — Council Directive 94/45/EC of 22 September 1994 on the establishment of a European Works Council or a procedure in Community-scale undertakings and Community-scale groups of undertakings for the purposes of informing and 46. The questions referred are like com- consulting employees (OJ 1994 L 254, p. 64), as amended municating vessels in that there is a direct by Directive 97/74/EC of 15 December 1997 (OJ 1998 1. 10, p. 22) and Directive 2002/14/EC of the European Parlia- ment and of the Council of 11 March 2002 establishing a general framework for informing and consulting employees in the European Community (OJ 2002 L 80, p. 29). 8 — Seventh recital in the preamble.

connection between the answers to be given If it is found that that provision does indeed to the two questions. If the answer to the exhaustively regulate co-determination by first question is in the affirmative (meaning local staff, then there is no latitude for that the term 'conditions of employment' parallel or supplementary application of used in Article 79 of the Conditions of the national provisions on co-deter- Employment also includes the national mination. If the opposite is found to be provision on co-determination) this means true, then such latitude does exist. that the answer to the second question must be in the negative (meaning that Article 9 of the Staff Regulations is not exhaustive). Conversely, if the first question is answered in the negative this will imply an affirm- ative answer to the second question. 49. Thus it is possible to distinguish two approaches to the problems raised for discussion by the questions referred. One approach is the broad interpretation ('con- ditions of employment' includes co-deter- mination; Article 9 of the Staff Regulations is not exhaustive) with the emphasis on the 47. The first legal issue concerns the sig- idea that co-determination serves to protect nificance and scope of the term 'conditions the worker. This is the approach taken by of employment' used in Article 79 of the the plaintiff in the main action and by the Conditions of Employment. Must the ref- Austrian Government, the Swedish Gov- erence to national law for more detailed ernment and the Netherlands Government. conditions of employment of local staff be The other approach is more restrictive understood to mean that those conditions ('conditions of employment' relates only include national provisions on co-deter- to the individual contract of employment; mination as laid down in Part II of the Article 9 of the Staff Regulations is exhaus- ArbVG? In other words, must the term tive) with co-determination being regarded 'conditions of employment' be construed as part of the internal order of an under- narrowly in the sense that it is limited to the taking or organisation. This is the approach (individual) contractual aspects of the taken by the Commission and the German e m p l o y m e n t r e l a t i o n s h i p between Government. I will first of all set out the employer and employee, or is a broad main arguments in support of each view as interpretation possible with the result that presented by the interveners. the term also includes the (collective) organisational aspects of the work?

52. Besides these arguments of a more textual nature, the plaintiff refers next to the context of Article 79 in the Conditions 51. The plaintiff further argues that since of Employment as a whole. That provision Article 79 of the Conditions of Employ- has a central function within Title IV and ment stipulates that the conditions of has as its purpose to provide the local staff, employment should be determined 'in on account of their social and political accordance' ('sur la base') with current connection with the country of employ- rules and practice in the place where the ment, with a level of protection cor- member of staff is to perform his duties, responding to the national rules on the account must be taken of all the relevant matter. The plaintiff points out, moreover, fundamental provisions of the national that the Framework rules on non-member legal system concerned. In this connection countries and the special conditions for the plaintiff refers to the judgment of the Austria contain provisions which cannot be Court in Vitari. 10 In that judgment, which counted as classic contract clauses, which to my knowledge is the only one concerned include social security, complaints and with this provision, the Court ruled that the appeals and disciplinary measures. The reference in Article 79 of the Conditions of Conditions of Employment themselves also Employment to the current rules and prac- contain a provision regulating the right of employees to vote and stand for office, which has traditionally been considered 9 — Article 39(2) of the EC Treaty reads: 'Such freedom of part of collective labour law. Finally, the movement [for workers] shall entail the abolition of any discrimination based on nationality between workers of the Member States as regards employment, remuneration and other conditions of work and employment.' 10 — Case C-126/99 Vilari [2000] ECR I-9425. 11 — Paragraph 23 of the judgment.

56. Proceeding from the idea that the primary purpose of labour law is to protect 54. As regards Article 9 of the Staff Regu- the worker, the Government of the Repub- lations the plaintiff takes the view that the lic of Austria points to the special situation Staff Committee only has the right to be of local staff. Unlike the rest of the 'other heard and that its rights of co-deter- servants' of the Communities, they are mination have been regulated in only a connected only marginally, given the pre- fragmentary way. Moreover, it represents dominantly executive nature of their activ- the staff in relations with the institution ities, with the institutional structure of the itself and therefore not in relations with Commission. To assume in those circum- part of a service, such as the representation. stances that the term 'conditions of employ- In these circumstances, attributing an ment' used in Article 79 of the Conditions exhaustive nature to Article 9 would be of Employment did not include collective inconceivable. Assuming that the Commu- labour law would result in discrimination nity legislature intended to establish a between local staff on the one hand and definitive and exclusive set of rules in other servants on the other, given that the Article 9, this would amount to ascribing former do not then really have a represen- to that legislature the intention of making tative body that is in a position to represent effective representation of staff interests all their interests. The Staff Committee is impossible. not equipped to do that, particularly also

because extensive knowledge of national principle of the primacy of Community law law is necessary in order to do so. The only entails the disapplication of national protective purpose of Article 79 therefore law in the event of a conflict between that precludes an interpretation which makes it law and Community law. There is, how- possible to draw a distinction between the ever, no such conflict in this case between individual and collective aspects of employ- Austrian law on labour relations in the ment relationships. workplace and the somewhat fragmentary rights of the Staff Committee. The two categories of rules should instead be assumed to co-exist. By referring in Article 79 of the Conditions of Employ- 57. The Austrian Government takes the ment to the national law, and in the light of view that its approach is confirmed by the the principle of equal treatment of local fact that Article 79 of the German version staff and other workers at the place con- of the Conditions of Employment uses the cerned, Community law recognises in this term 'Beschäftigungsbedingungen'. respect the possibility of dual represen- Although the substance of this multi-fa- tation by the works council and the Staff cetted term is illustrated with a non-ex- Committee. haustive selection of subjects relating to the individual employment relationship, that provision does not preclude the collective employment rules from being covered by it as well. The Austrian Government also 59. The Swedish Government points out by refers in this connection to the rules on the way of a preliminary point that Article 79 right to vote and stand for office laid down of the Conditions of Employment must be in Article 7 of the Conditions of Employ- construed as meaning that although it gives ment, which falls outside the framework of the Community institutions some discre- the individual employment relationship. In tion when determining the conditions of its view, the passage from the Vitari judg- employment of local staff, it does not allow ment 12 which was cited in this connection them to lay clown conditions of employ- means that when determining the working ment which differ fundamentally from conditions of local staff the national legal those which apply to other workers in the system as a whole must set the direction. country concerned. This also follows from The reference can therefore be said to be a the Vitari judgment. '•' The reference in broad one to Member States' national law that provision to national law must be in its entirety, the underlying idea being construed as meaning that when determin- that of achieving equal treatment of local ing the conditions of employment of local staff and other employees working at the staff, the basic requirements of national place concerned. law must be taken into account.

division made in Austrian law into (collec- view that such a rudimentary scheme tive) law on labour relations in the work- cannot be regarded as an exhaustive place and other parts of labour law, the scheme in respect of the rights of local Swedish Government points out that the staff. If it could, this would mean, as far as Court cannot use such a division as a the Swedish situation is concerned, at any criterion when interpreting Community rate, that the conditions of employment of law. Concepts of Community law must be local staff would differ fundamentally from interpreted autonomously. It is true that those of other workers. This would not be when making that interpretation account in keeping with the basic idea that underlies must be taken of common traditions of the the rules on the legal position of local staff. Member States but, according to the Swed- The rules contained in the Conditions of ish Government, the division made in Employment must be regarded as minimum Austrian law cannot be traced back to such rules. The Community institutions must a tradition. Employment law is, precisely, a take account of fundamental provisions of field in which the Member States' legal national law which provide further-reach- systems differ widely. Community law has ing protection, provided there is no direct no such division either. Measures which are conflict with Community rules. No such taken on the basis of Article 137 of the EC conflict exists in the election of the works Treaty in order to achieve the objectives of council by the local staff of the Vienna Article 136 of the EC Treaty, inter alia in representation of the Commission. the field of the conditions of employment and the information and consultation of workers, may ultimately work their way through to individual conditions of employment. The Swedish Government therefore takes the view that there is no reason whatever to assume that there are 62. The Netherlands Government argues categories of legal rules which are not with regard to the question about the covered when reference is made in Com- applicability of the ArbVG that it is necess- munity law to national law. If it can be ary to proceed first and foremost on the assumed that the Austrian provisions play a basis of the principle of territoriality. Under central role in Austrian labour law, then that principle the representation of the those provisions should be applied to the Commission is subject to Austrian labour conditions of employment of local staff, law, save where expressly stipulated other- provided of course that the application of wise. In the absence of any such express those rules is not inconsistent with any rule provision, including in the Protocol on of Community law. Privileges and Immunities of the European Communities of 8 April 1965, it must be assumed that the ArbVG applies in full to the representation.

of Employment confirms that the Commu- information on the European Union gen- nity institution concerned must take the erally. Under Article 7 of the Conditions of principle of territoriality as the guiding Employment, local staff have the right both principle when determining the conditions to vote and to stand for office in elections of employment and the other aspects of to the Staff Committee. Although no rep- labour law applicable to local staff. In this resentatives of the Vienna representation context the distinction that is made were elected to the Staff Committee in the between collective and individual labour 1999 elections, a local member of staff of law is irrelevant. The staff concerned must another representation was elected. The be given a level of protection equal to the Commission takes the view that the ArbVG level of the national legislation. Although does not apply to it, that the setting up of that judgment regarding equality is the works council is invalid and that the reserved to the national court, the Nether- works council therefore does not have the lands Government believes that the Aus- capacity to be a party to legal proceedings. trian legislation affords far-reaching pro- tection in the matter of co-determination by workers, with the result that Commu- nity law must give way here. 66. As regards the answer to the first question, the Commission believes that a distinction must be made between collec- tive and individual labour law. In its view Article 79 of the Conditions of Employ- 64. Following on from this position, the ment relates solely to individual labour Netherlands Government takes the view law. This is apparent not only from the that Article 9 of the Staff Regulations does examples included in that provision but not contain an exhaustive set of rules on also from the system of the Conditions of the representation of local staff. Employment. Thus the Commission points out that Article 7 of the Conditions of Employment on the right to vote in elec- tions and stand for election, which must be counted as part of collective labour law, is included in the general provisions of the Conditions of Employment which apply to all staff and therefore do not come under Observations submitted in favour of the national law. It is only the rules that have narrow interpretation to be applied in the individual employment relationship that must be modelled on national law. The rules on representative bodies and their powers do not fall within this category. 65. The Commission made its observations in its capacity as the defendant in the main action. It points out at the outset that the representation forms part of the internal organisation of the Commission. The job of the representation is to represent the Com- 67. Any other interpretation would, in the mission's interests in Austria and to provide Commission's view, run counter to the

68. The Commission answers the second question, which concerns whether Article 9 and Annex II to the Staff Regulations are exhaustive, in the affirmative. The Com- mission points out that the collective 70. In the Commission's view, dual repre- aspects of the employment relationship sentation would destroy the coherence of and the right of local staff to be heard are the system of representation within the laid down in a regulation and that that institutions and make it less effective. regulation takes precedence over any provi- Conflicts and differences of view would sion of national law which is incompatible be inevitable, given the differences in the with it. The job of the Staff Committee is in tasks and powers of the Staff Committee general terms to represent the interests of and a body such as the works council. In the staff as a whole, irrespective of the legal the Commission's view, representation of position or place of engagement of the servants should take place through only member of staff concerned. It would be one channel and, assuming the primacy of inconsistent with the general character of Community law, that must be the Staff the committee's job for a section of the staff Committee. to be represented by a competitor body.

69. It is also necessary to take into account in this connection the fact that different 71. It is clear from a comparison of the decisions which, under the Austrian law, possibilities for participation in manage- have to be submitted to the works council ment by a works council set up under the

ArbVG on the one hand and by the Staff relations between the Community institu- Committee on the other that the works tions and their servants, that can only lake council has further-reaching powers. place through Community law. In the Where the plaintiff argues that the Com- absence of an express reference in munity rules amount to only a rudimentary Article 79 of the Conditions of Employ- outline of a system of co-determination, the ment to the national law on collective Commission points out that the Commu- industrial relations, it must be found, a nity system makes it possible for the Staff contrario, that this part of national employ- Committee — including through the Joint ment law does not apply to local staff. Committees — to play an important and effective part in practice. By determining the conditions of employment of local staff on the basis of national law, sufficient account is taken, in the Commission's view, of their close links with the Member State of employment. Finally, although these 73. In the German Government's view, this cannot be regarded as representatives in position is consistent with both the objec- the true sense of the word, it is also tives of national law on labour relations in important that at every Commission work- the workplace and the objectives of the place there are staff spokespersons who can Staff Committee. While it is true that as bring problems to the attention of both the regards the scope of national legislation on-site management and the Staff Com- broadly speaking it is necessary to proceed mittee. The Commission's conclusion is on the principle of territoriality, that legis- therefore that the collective aspect of lation does not take account of the par- employment law that applies to servants, ticular function and the organisation of including local staff, is exhaustively regu- representation of the Commission abroad. lated at Community level. Where the national provisions on co-deter- mination give workers a degree of involve- ment in decision-making within the under- taking, it must be recognised that the directors of a Commission representation no more take decisions on operational management than do the heads of diplo- matic or consular representations. Their primary task is to protect the interests of the State or (international) organisation 72. The German Government contends that they represent. In particular they must- that neither on the basis of the wording of avoid becoming involved in local 'trade Article 79 of the Conditions of Employ- union' conflicts. ment nor on the basis of Article 9 of the Staff Regulations in conjunction with Annex II to the Staff Regulations, in this case, does Austrian law on labour relations in the workplace apply to the situation which is the subject-matter of the present- dispute. If, by way of exception, national 74. To put it briefly, national provisions on employment law must be declared appli- labour relations in the workplace are not- cable to the industrial or employment suitable to be applied to the internal

organisation of such representations. Union. In other words, it also applies to Whenever a State declares such a procedure representations of the Union in non- to apply to its own government, the member countries. If it were possible for a procedure is a national statutory measure host country to declare its national law in which cannot be binding on international the field of co-determination applicable to or supranational organisations or other a representation of the Union, this would Member States that have a representation open the possibility of unlawful influence in the country concerned. On the other and could impair the fulfilment of the hand, it is perfectly possible for an institu- representation's mission in the interest of tion or a State to reserve the right to take the Union. measures to involve staff at representations abroad in the development of rules on working conditions. The Community insti- tutions, taking into account their own function and organisation, have therefore adopted a special set of rules on staff representation which, if it is not to run the risk of being undermined, must take precedence over national legislation on Analysis and answers to the questions labour relations in the workplace. The concurrence of national and community rules in this area could, in the German Government's view, lead to absurd con- sequences. At present the Community has 76. As I stated in my introductory remarks, its own specific set of rules which is tailored the purpose of the action before the Aus- to its own function and organisation. If the trian court is to have a body set up at the force of that set of rules could be eroded by representation of the Commission of the the application of national law, this would European Communities which, in accord- be contrary to the intention of the Com- ance with the ArbVG, represents the local munity legislature. staff and can exercise the powers ensuing from the ArbVG. A legal basis must be found for this and, since we are dealing here with an employment relationship governed by Community law, the question in the first instance is whether that basis can also be found in Community law. If not, the question is whether Community law allows national labour law, more specifically the national law on labour 75. Finally, the German Government relations in the workplace, to be applied points out that the unconditional appli- in this case by way of supplement. cation of Community law in this matter is ensured by the rule of international custom- ary law, which guarantees the freedom to set up the internal organisation of repre- sentations abroad. Moreover, care needs to be taken that Community law on staff representation is applied in the same way 77. These are the questions, expressed in both within and outside the European more general terms, which lie behind the I - 7706

78. I have already stated in my introduc- 80. The arguments focus on the interpre- tory remarks that the subject of worker tation of Article 79 of the Conditions of co-determination must be seen first and Employment, which form the basis of the foremost as a question that relates to the employment relationship between the local organisation of an undertaking or institu- staff concerned and, in this case, the tion. The issue is the way in which Commission. On the basis of that provi- decisions that affect the operation of the sion, the conditions of employment of those undertaking or institution are made within staff are determined by each institution in the undertaking or institution. The interests accordance with current rules and practice of the different categories of worker also in the place where they are to perform their play a part, of course, but the criterion for duties. In order to indicate which con- the contribution made by those categories ditions of employment must be determined must always be the extent to which the in each case in accordance with the undertaking or institution concerned can national law, explicit mention is made in best achieve its objective in the interest of a non-exhaustive list in that provision of everyone involved at the undertaking or the aspects 'the manner of their engage- institution. ment and termination of their contract', 'their leave' and 'their remuneration'.

79. As regards the local staff at the Vienna representation of the Commission, there are two channels through which they can practise co-determination: the Staff Com- 81. It is precisely in connection with the mittee referred to in Article 9 of the Staff non-exhaustive nature of that list that the Regulations and the works council referred question is whether the term 'conditions of to in Paragraph 40 in conjunction with employment' is broad enough to be able to Paragraph 50 of the ArbVG. It is not cover provisions on co-determination, with disputed that the powers of the works the result that where local staff are con- council established under national law cerned the Community institutions must extend further than those of the Staff also take account of national rules in this Committee and that the ArbVG thus area.

82. The plaintiffs and the Austrian Govern- sity in this area is, as I have already ment, the Swedish Government and the observed, too great for that in this case. Netherlands Government have put forward Be that as it may, the actual function of a arguments of a textual, systematic and Community term in the context of the body teleological nature to show that the term of Community rules concerned must 'conditions of employment' must be inter- always be the primary consideration when preted widely and that the reference to the the substance of that term is being deter- national legislation which the Community mined. institution must take into account when determining those conditions is broad in nature. The Commission and the German Government, on the other hand, have 84. If that function is taken as the basis on argued that this term can have only limited which to proceed, it must be noted that the significance and relates solely to the indi- Vienna representation of the Commission vidual aspects of the employment relation- forms an integral part of the formal ship. I have already set out the main organisation of the Commission. The issue arguments for and against in detail above. in this regard is the employment relation- ship between an institution of the European Union and a category of servants of that institution. The conditions of employment which apply to that employment relation- ship pursuant to Article 79 of the Con- ditions of Employment are determined by the Community institution concerned. On the basis of that provision the said institu- 83. I would first like to state that the term tion uses the rules and practice of the place 'conditions of employment' contained in of employment as a reference framework, Article 79 of the Conditions of Employ- but the conditions of employment them- ment, which forms part of Regulation selves have a Community basis. National No 259/68, is a Community term whose labour law is not incorporated into them by content must be determined on the basis of means of a reference. The substance of the aim and function of the set of rules in national rules is adopted in so far as that is which it is used. I share the Swedish necessary and helpful for the employment Government's view that national divisions relationship with the local staff and affords of an area such as labour law whereby the them a minimum guarantee that their generic term conditions of employment is employment contracts are being entered subdivided into a collective part and an into under conditions which are the same individual part cannot be used to determine as or equivalent to the conditions which the content of this Community term. In the they would enjoy with a local employer. same spirit, the German term for 'con- ditions of employment', Beschäftigungs- bedingungen, cannot, contrary to what the Austrian Government argues, be used 85. I understand the judgment of the Court to define the term conditions of employ- in Vitari, 14 which has already been men- ment. While it is true that legal traditions tioned several times, in the same spirit. The and terms which the Member States have in common can serve in certain cases to define Community terms more closely, the diver- 14 — Cited in footnote 10.

dispute at issue in that case concerned the employment), I believe that by its reference question whether a member of the local to 'the fundamental rules of the applicable staff who had concluded a fixed-term national law' the Court can only have contract of employment with the European meant the fundamental rules of national Training Foundation could rely upon a law which related to the nexus of problems provision of Italian legislation according to at issue in that case. It would be going too which, bar a few exceptions, employment far, in my view, to read that passage as contracts had to be concluded for an saying that the term 'fundamental rules' indefinite period. In that case the applicable refers to the whole of national law, includ- Community rules likewise provided for the ing in so far as that law governs subjects conclusion of contracts of indefinite dur- that lie outside the scope of the contract of ation, with the result that there was no employment concerned. Rather, by qual- contradiction on that point between the ifying its reference to the basic rules by national and Community rules. The dispute saying that they must be of the 'applicable' came to a head over the question whether national law, the Court means, in my view, there were circumstances that justified a that the provisions of national law which contract being concluded for a fixed term are relevant to the contract of employment in derogation from the main rule. This was are determined by the substance of that the context in which the Court placed contract and not the reverse. paragraph 23 of its judgment, which all the parties have cited and which reads as

local staff. That article clearly states that by means of an express Community act. the conditions of employment of local staff Pursuant to the express reference in are to be determined by each institution in Article 79 of the Conditions of Employ- accordance with current rules and practice ment, national law serves in this context as in the Member State where the worker is to a binding guideline for the conditions of perform his duties, which merely means employment which are to be determined. that the rules adopted by each institution As far as determining the content of the may not conflict with the fundamental contract and therefore of the conditions of rules of the applicable national law.' employment to be applied in that context is concerned, the national law restricts the policy freedom of the Community institu-

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It has been scope of Title IV cannot, in my opinion, go pointed out, in particular by the plaintiff, further than the aspects that have been that Article 79 has the purpose of affording regulated in the other Titles. It would, in specific protection to local staff against short, be contrary to the system of the having to enter into an employment rela- Conditions of Employment to assume that tionship with a Community institution on on the basis of Article 79 matters could be conditions of employment that are incom- regulated for which no rules had been patible with the rules and practice in force adopted in respect of the other categories in the country where the worker performs of servants. his duties. For this reason it must be concluded, according to that line of reason- ing, that national law has primacy over the Community provisions in this area.

' c o n d i t i o n s of e m p l o y m e n t ' used in 91. It seems to me that when laying down Article 79 of the Conditions of Employ- Article 79 of the Conditions of Employ-

ment the Community legislature certainly ensured in some way other than through had the interests of local staff in mind, but, the notice of 'conditions of employment'. 16 as may appear from my foregoing observa- As regards the internal organisation of the tions, I take the view that the protection Union, that right is guaranteed through the intended is more limited than the plaintiffs combined provisions of Article 9 of the have argued it is. Precisely because local Staff Regulations, Article I of Annex II to staff work in a familiar environment and the Staff Regulations and Article 7 of the are somewhat removed, as regards their Conditions of Employment. duties, from the activities of the Commu- nity institution which they serve, the obvious thing to do is attune their con- ditions of employment to local conditions 93. On the basis of this analysis of the rather than impose on them the central textual, contextual and teleologica! conditions of employment which are approaches to the term 'conditions of designed to help accomplish the mission employment' used in Article 79 of the of the institution concerned. This does not Conditions of Employment, I reach the apply to the rules on co-determination, conclusion that this term must he construed however, which have more to do with the in a restricted sense and that it refers only structure of the organisation as such. to elements of the individual employment relationship such as, in particular, the elements mentioned in Titles II and III of the Conditions of Employment.

This actively and passively within such a struc- reference too cannot exceed the substantive ture on the other. In so far as a link can scope of those rules, in my view. Since indeed be made between co-determination those rules are limited to determining con- and 'conditions of employment', it would ditions of employment in the narrow sense, have to be found in this latter, individual that Article cannot be relied upon either as aspect. In my view, however, that char- the basis for establishing a works council acterisation would again detract from the fundamental nature of the worker's right to participate in the co-determination struc- 16 — Article 27 of the Charter oi Eiuulanicntal Rights of the ture of the undertaking or organisation in European Union, which the plaintiffs cite, mentions only a workers' collective ri(;lit to information anil consultation which he is employed. That right is usually within the undertaking.

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97. In this way the Community legislature been invoked by any of the parties inter- created its own internal rules on staff vening in the present dispute. That case co-determination which, it may be concerned the situation of a temporary assumed, are in its view tailored to the worker who had been placed at the Euro- needs of the various institutions and per- pean Commission's disposal by two dif- formance by them of their missions. The ferent temporary-staff agencies and who in question, however, is whether co-deter- reliance upon certain provisions of Belgian mination, in particular by local staff, must labour law claimed that the employment take place solely through those Staff Com- relationship should be converted into a mittees. contract of employment of indeterminate duration. When answering the question whether the Commission was bound in such a case by the provisions of national law concerned, the Court held: 'It is true that a temporary worker cannot be denied social protection solely on the ground that he has been placed at the disposal of a 98. I would point out in this connection Community Institution. However, such that the institutions of the European Union protection cannot be provided by weans work within the Community's own legal which encroach upon the autonomy of the system and are autonomous within it. The Community institutions in this area.... [I]t institutions of the European Union operate, is not possible for a contract of employ- from the internal, organisational point of ment with a Community institution, a view, entirely independently of the Member fortiori a contract of employment of inde- States. This is a consequence of their task of terminate duration, to come into being as a operating in the interest of the Union and is result not of a decision of the designated also a fundamental condition for the per- competent authority but of the fact, even formance of that task. where if is supported by a decision of a national court, that certain statutory provi- sions of the Member State in which that institution is situated which relate to tem- porary work have not been complied with.' 19

as the penalty for infringing national labour servants are represented within them on an law but with a situation where a body set equal footing. This principle of equality is up under national labour law could exer- also laid down for relations within the cise powers derived from the same national European Union in Article 1 of Annex II to labour law vis-à-vis part of a service of the the Staff Regulations. 2 0 If it had to be Commission and thereby could influence assumed that certain categories of staff, the internal organisation of the Commis- such as in this case local staff, could, on the sion. It seems obvious to me that such a basis of national employment law in addi- form of influence is diametrically opposed tion to the available Community provi- to the principle of the autonomy of the sions, be represented by their own works Community institutions. council, this would create an unacceptable inequality between the different groups of servants of the Union and also be detri- mental to the co-determination structure within the Community.

104. The Netherlands Government has argued that as regards the possibility of 102. I would point out, moreover, that it is an important condition for the functioning of co-determination procedures that all 20 — See point 7 above.

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108. By way of objection to an exclusive role for the Staff Committee the plaintiff, 106. In view of my position on the conflict the Austrian Government and the Swedish with the principle of the autonomy of Government have also pointed to the

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rudimentary nature of the Community to assess whether the applicable rules must rules on co-determination by comparison be adjusted or tightened up. with, at any rate, the Austrian law in this field. Although I have already acknowl- edged at point 79 above that this could in fact be the case, this nevertheless does not alter my position on the main proceedings. 109. On the basis of these observations and The quality or effectiveness of the co-deter- in particular the point that the provisions of mination structure of the Community itself the Community and of the Republic of is not being assessed in this case. I agree Austria on co-determination apply in sep- with the court at first instance that the fact arate legal spheres I arrive at the conclusion that a set of rules can perhaps be improved that Article 9 of the Staff Regulations cannot justify not applying it. Such a case provides for an exhaustive set of rules on provides an opportunity for the legislature co-determination for the officials and other servants of the Community.

V — Conclusion

110. I therefore propose that the Court answer the questions referred by the Oberster Gerichtshof as follows:

(2) The provisions of Article 9 of the Staff Regulations of the European Communities and those contained in Annex II to the Staff Regulations concerning the Staff Committee, which also represents the interests of local staff of the Communities, are to be interpreted as laying down exhaustive rules on collective employment law and the powers of co-decision of local staff and thus as precluding the application of the law on labour relations in the workplace laid down in the Austrian Labour Constitution Act to local staff serving in the Vienna representation of the Commission of the European Communities.

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