Temporary workers are included in the calculation of the threshold for establishing a supervisory board within a company, even if they are assigned to the company for less than six months. This was decided by the Federal Court of Justice (BGH). What matters is not the individual duration of employment of each temporary worker, but rather their workstation: If a workstation is staffed by temporary workers for a period of more than six months, it is to be counted in the same way as a permanent position—even if individual temporary workers rotate through it. By focusing on the workstation, the BGH aims to ensure that the legislature’s objective is met: Temporary agency work must not be misused to permanently cover staffing needs—and thus to replace permanent positions. Workstations permanently staffed by temporary agency workers are therefore just as defining for the company’s permanent workforce as permanent positions.
Workplace-Based Approach Rather Than Person-Based Approach
In the present case, the General Works Council (GBR) of the contract logistics service provider Syncreon, with the support of IG Metall, filed a lawsuit against the company. From the perspective of the GBR and IG Metall, Syncreon is required to elect a supervisory board that is composed on a parity basis—that is, with half of the seats filled by employee representatives—in accordance with the provisions of the German Co-Determination Act (Mitbestimmungsgesetz), which generally applies to companies with 2,000 or more employees. Including temporary agency workers, Syncreon employed approximately 2,300 workers at the start of the legal dispute four years ago.
However, Syncreon—like many other contract logistics service providers—has a high proportion of temporary agency workers. About one-third of the positions are filled by temporary agency workers, who are also frequently rotated and often remain with the company for less than six months. Syncreon’s management argued that these approximately 500 temporary agency workers should not be counted, which would bring the total number of employees below the threshold of 2,000. In the course of the legal proceedings, Syncreon even increased the proportion of short-term temporary agency workers—and maintained that, as a result, there was no need to establish a joint supervisory board.
But it must be established, the Federal Court of Justice has now clarified.
More Supervisory Boards with Employee Representation
With its ruling, the BGH strengthens employee co-determination. As a result, the number of companies with a supervisory board half of whose seats must be filled by employees will increase.
In addition, the BGH has now, for the first time, interpreted the Temporary Employment Act (AÜG), which regulates temporary work, to mean that it is not the duration of an individual temporary worker’s assignment that counts—but rather how long the position has already been filled by temporary workers:
“The minimum assignment period in Section 14(2), sentence 6, of the AÜG is to be understood as referring to the specific job,” states the BGH’s reasoning. “Accordingly, the decisive factor is whether the company fills positions with temporary workers for a period exceeding six months within a year, regardless of whether this involves the assignment of a specific or rotating temporary worker and whether the temporary workers are assigned to the same or different positions.”
The BGH thus concurred with the view of the General Works Council, IG Metall, and labor law expert and long-time President of the Federal Labor Court Franz Josef Düwell that, when calculating the threshold for establishing a supervisory board with equal representation, the focus should not be on the duration of individual temporary workers’ assignments, but rather on the total number of workstations that define the company over the long term.
