Kliemt & Vollstadt
Overview
On 18 August 2006, the Federal Equal Treatment Act (Allgemeines Gleichbehandlungsgesetz, AGG) has come into force in Germany. The AGG is implementing four European Community (EC) directives including the Framework Directive 2000/78/EC. The aim of the AGG is to prevent and abolish discrimination on various grounds including age. The law protects against direct and indirect discrimination (Benachteiligung) as well as harassment (Belästigung) on the grounds stated in Sec. 1 AGG.
Different treatment on the grounds of age may be justified in certain cases. A different treatment does not constitute discrimination if it constitutes a genuine occupational requirement provided that the objective is legitimate and the requirement is appropriate. Furthermore, different treatment regarding age is permitted if it is
- objective and
- appropriate and
- justified by a legitimate objective, and
- the means to achieve this objective are appropriate and necessary.
For example, it is acceptable to take the age into account when relocating an employee as long as the age is not the only criterion taken into account. Harassment, however, cannot be justified under any circumstances.
There is no rule or provisions concerning victimisation/retaliation. Both are not considered discrimination and only subject to the German Civil Code (Bürgerliches Gesetzbuch, BGB). There also is no local law considering discrimination in Germany.
Who is covered?
The persons and institutions the AGG is applicable on are listed in Sec. 6 AGG. These are:
- all employees (Arbeitnehmer) and trainees (Auszubildende),
- applicants for a job (Bewerber) and former employees,
- persons of similar status to employees (arbeitnehmerähnliche Personen), e.g. long-term freelancers
- sales representatives (Handelsvertreter) and other self-employed (Selbstständige),
- directors (Geschäftsführer) and board members (Vorstandsmitglieder) although they are not considered as employees under German law, are protected but only with regards to conditions on access to occupation and career advancement.
There is no differentiation between old and young individuals; both receive the same level of protection. There are, however, special rules applicable within the public service. According to Sec. 24 AGG, the law is only applicable in a limited way on the following groups due to their legal status as parts of the public service:
Although not expressly excluded from the scope of the AGG, the Federal Administrative Court (Bundesverwaltungsgericht, BVerwG) decided in 2007 that the law is not applicable with regards to the German Armed Forces (Bundeswehr).
What enforcement/remedies do exist?
A direct or indirect discrimination only has consequences in civil law. Harassment may also result in criminal sanctions although there are no specific criminal sanctions named within the AGG. Instead in severe cases harassing behaviour can be considered a defamation resulting in criminal sanctions according to the German Criminal Code.
There is no enforcing body in Germany. A Federal Anti Discrimination Agency (Antidiskriminierungsstelle des Bundes) has been implemented. This authority may support victims of discrimination but not enforce their claims on its own. Thus enforcement is a matter of the person affected. This person can also be supported by an anti-discrimination organization (Antidiskriminierungsverband) and of course by regular lawyers.
The AGG contains several civil remedies. Employees feeling unfavourably treated have a right of appeal to a complaints board (Beschwerdestelle) that has to be implemented by the employer, Sec. 13 AGG. If the discrimination reaches the level of harassment, the person affected is entitled to cease his or her work without loss of payment under certain restrictions, Sec. 14 AGG, but at risk of being wrong in their judgement. According to Sec. 15 AGG, an employee that has been discriminated against may also be entitled to damages. The employer has to pay compensation for the material damage arising from the discrimination or harassment as well as damages for pain and suffering. However, in case of job applicants, the amount of damages for pain and suffering is limited by law to three monthly payments out of the potential job.
Claims are brought before the Lower Labour Court (Arbeitsgericht). The employee must assert claims for damages in writing within a period of two months, Sec. 15 para 4 AGG. Following this, the employee must file a suit within three months after asserting the claim in writing, Sec. 61b para 1 Federal Labour Court Act (Arbeitsgerichtsgesetz, ArbGG).
How common are claims?
There is no detailed statistic on the effects of the AGG yet. General statistics show that only 0, 1 percent of the labour law suits in Germany are related to the AGG (enacted 2006). In general, the consensus is that there are far less claims and lawsuits than expected. There is a detailed statistic from the Higher Labour Court of Baden Württemberg (Landesarbeitsgericht Baden Württemberg) concerning the AGG that covers the period from 18 August 2006 to 18 April 2007. Within this ten months period there where 109 lawsuits based on discrimination, more than half of them ended with a settlement. According to this statistic, the most common kind of discrimination is the one on the grounds of age (36 percent) followed by sex (28 percent) and disability (18 percent).
What claims are most common and what are trickiest issues for employers?
Problems with all criteria of discrimination may occur during the process of recruitment of an employee. Not only job advertisements have to be carefully checked for discriminatory content (e.g. “We are looking for a young secretary to support our team.”). Especially in interviews with applicants certain aspects have to be considered to prevent discrimination by posing the wrong questions, for example: “How old are you?” Therefore employers are advised to:
- review existing personal questionnaires and documents,
- avoid direct questions with regard to age in the interview,
- conduct interviews always together with a second person present and
- carefully document personnel decisions.
It can be said that age discrimination holds the highest liability risk for employers.
A large financial risk may arise out of a Social plan (Sozialplan). According to German law, such a plan has to be constituted by the employer and the works council in case of redundancies to prevent disadvantages for the employees. Social plans that discriminate a group of employees (e.g. young employees) by granting another group of employees (e.g. older employees) disproportionately more benefits have to be corrected in a way that the discriminated group also gains the same level of benefits.
There also is a risk of discriminating employees when negotiating union agreements with trade unions. In a recent decision, a Higher Labour Court ruled that a compensation system based on reaching a certain age which was part of a union agreement is considered a unjustified discrimination. The employer will now have to pay the highest wage of the compensation to all employees regardless of their age. For more details see “interesting cases” below.
Are there any specific exceptions in your laws?
The AGG is not applicable on the German Armed Forces (s.a.). Further exceptions can be found in Sec. 2 AGG. According to Sec. 2 para 2 AGG the AGG is not applicable with regards to social benefits. Instead the German Social Laws apply, including their own prohibition of age discrimination. Also, the AGG is not applicable to company pension schemes, which are covered by the Federal Company Pension Law (Betriebsrentengesetz).
According to Sec. 2 para 4, the AGG is not applicable on dismissals. This is considered a violation of the EC-directives because the directives contained a protection from discrimination during dismissals. The problem that occurs with the AGG not being directly applicable is solved by interpreting German Labour Law in accordance to the AGG in order to provide protection from discrimination in case of a dismissal. As a result, employees being discriminated may include the aspect of discrimination into the lawsuit regarding social protection against unfair dismissal. If they are successful the dismissal is void.
Retirement ages
In Germany, the current legal retirement age is 65. Until 2029, it will be raised to 67. The employment contract expires if it is limited in advance to the legal retirement age. If not an employee reaching the retirement age must be given notice of termination or the employment contract must be terminated by mutual agreement. Sec. 10 No. 5 AGG expressly provides that an agreement terminating the employment contract when the employee reaches legal retirement age is permitted.
Interesting cases
A very interesting decision regarding age discrimination under German law was made before the enactment of the AGG. It was decided by the European Court of Justice (Europäischer Gerichtshof, EuGH) in 2005 (so-called “Mangold-decision”) and concerned fixed-term employment contracts with older employees. The Federal Part-Time Work and Fixed-Term Employment Contracts Act (Teilzeit- und Befristungsgesetz, TzBfG) in its Sec. 14 para 3 ruled that no objective reason is necessary to impose a time limit on the employment relationship if the employee has reached the age of 52. The EuGH held that Sec. 14 para 3 TzBfG violates the framework directive 2000/78/EC and the prohibition of age discrimination and may therefore not applied by national courts (EuGH, 22.11.2005 – C-144/04, Mangold). It has now been amended.
The Federal Labour Court (Bundesarbeitsgericht, BAG) has accepted collectively agreed age limits for particular occupation groups, for example pilots, because they serve to protect the life and health of third parties. For example, the BAG has held that a collectively agreed age limit of 60 is admissible for pilots (BAG, 21.7.2004 – 7 AZR 589/03). However, it has to be noticed that the AGG had not come into effect when this decision was made. This decision was later confirmed for pilots of the Lufthansa with regard to the AGG by the Higher Labour Court of Hessen (Landesarbeitsgericht Hessen) in 2007 (LAG, 15.10.2007 – 17 Sa 809/07).
The question of age limits also appears in public service. The Higher Administrative Court of North Rhine-Westphalia (Oberverwaltungsgericht Nordrhein-Westfalen, OVG) recently decided that the maximum age of 35 years when applying for public service is acceptable and justified by Sec. 10 AGG (OVG, 30.05.2008 – 6 A 3734/05). The age limit was accepted as an appropriate and necessary measure to provide an appropriate relation between time of active duty and the claim for pension after retirement, especially with regards to the training and education which is necessary to perform the job. There also is a public interest in a long period of service of civil servants because the financial burden of their generous old age pensions has to be borne by the general public. Another objective of the age limit was to provide a well balanced aging structure. This objective was also recognized by the court.
The Higher Labour Court of Berlin-Brandenburg (Landesarbeitsgericht Berlin-Brandenburg) decided in September 2008 that a compensation system based on the age of the employees is considered an unjustified discrimination on the grounds of age (LAG Berlin-Brandenburg, 11.09.2008 – 20 Sa 2244/07). In the case, such a system of compensation was provided by a union agreement for public employees without civil servant status (Bundes-Angestelltentarifvertrag, BAT). The plaintiff was aged 39 and was paid his wage according to this age. He sued his employer to receive the highest possible wage which is granted when reaching the age of 47. The court ruled in favour of the plaintiff. It has to be noticed that this decision still can be overruled by the Federal Labour Court.