A preliminary ruling concerning non-discrimination on grounds of age
Facts and procedure of the case
A French student (the applicant) had a fixed-term employment contract at the company Bio Philippe Auguste SARL (Bio) during his university vacation. At the end of his work period, end-of-contract payment was denied by the company. Such payment is provided as compensation for the insecurity of a fixed term worker’s situation, and should be paid when the expired contract is not renewed as an indefinite period contract. [Article L. 1243-8 Code du Travail].
The applicant brought an action before le Conseil des Prud´hommes, the French Labour Tribunal (the Tribunal), seeking the end-of-contract payment and compensation for dismissal without real and substantial cause. Bio (the defendant) justified the non-payment by referring to article L. 1243-10.2 Code du Travail (Labour Code) which states: “The end-of-contract payment shall not be payable […] Where the contract is entered into with a young person for a period falling within the school holidays or university vacations”. As for the applicant, he claimed that this article was contrary to article 6 Déclaration des droits de l’Homme et du citoyen de 1789 (Declaration of the Rights of Man and of the Citizens 1789), a constitutional provision that guarantees the principles of equal treatment and non-discrimination on grounds of age. Further, the applicant argued that the French legislator had not provided any definition of the term “young” in the relevant provisions.
The question of constitutionality was first referred to the French Conseil Constitutionnel (the Constitutional Council). The Constitutional Council stated that the term “young” has been defined in the Code de Sécurité Sociale, the French Social Security Code. In fact, article L. 381-4 prescribes an age-limit below which students must be affiliated to the national social security schemes by virtue of their enrollment at a school or university. Before reaching this age-limit, article L. 1243-8 Labour Code does not apply to students. Therefore, the applicant´s claim regarding the absence of a definition of the term “young” was refuted for lack of factual basis. The Constitutional Council further stated that such a legislated age-limit concerning students is not contrary to the principle of equal treatment [para 12].
When it comes to the end-of-contract payment, the Constitutional Council’s conclusion was that students employed under a fixed-term contract for a period during their school holidays or university vacations are not in the same situation as either students who work at the same time as pursuing their studies or other employees on fixed-term employment contracts. The declared purpose of such a bonus to the salary is specifically to compensate the insecure situation of the employee. Young students working during their vacations or holidays do not benefit from the end-of-contract payment since they are not in an insecure situation. Therefore, the Constitutional Council found no violation of the national Constitution. Thus, the difference in treatment in this case is justified by a difference in situation, directly in line with the purpose of law. [para 13]
Finally, the Labour Tribunal decided to refer the following question to the European Court of Justice (ECJ, the Court) for a preliminary ruling, is the general principle of non-discrimination on grounds of age preclude article L. 1243-10 Labour Code?
Findings of the Court
Already in the groundbreaking case of Mangold (C-144/04), the Court stated that Member States possess a broad discretion within the field of social and employment policy, both with regard of pursuing specific aims as well as the necessary measures thereof. This jurisprudence was reaffirmed in several cases (see Specht, para 46) as well as in this case where the Court concluded that the relevant national legislation falls within the Member States’ discretion in the fields of social policy [para 30].
In this case, the Court agreed with the Constitutional Council’s position and stated that in the light of the aim of article L.1243-8 Labour Code, the applicant’s situation is not objectively comparable to those of the employees included in the provision. As the French Government stated, the employment in question is to be considered both ‘temporary and ancillary’, since students intend to continue their studies when their holidays come to an end. The Court follows that line of argument. Also, the Court finds that other categories of employees, included in article L. 1243-10 as for example seasonal workers, are also excluded from such compensation. They are considered to be in a comparable situation to the applicant in terms of insecurity. Hence, two categories of workers exist, those who are entitled to end-of-contract payment and those who are not. It is not age discrimination to treat those different groups of workers differently. The Court finally concluded that the principle of non-discrimination, given specific expression in the Directive 2000/78 EC, is not to be interpreted as precluding domestic law as the one presented in this case. [see para 33, 37-9, 40].
The Court confirmed its jurisprudence (Maruko, para 67-73; Römer, para 42) in this case concerning the evaluation of discrimination (see para 32). The assessment should be done in a concrete and specific way in view of the benefit concerned. Also, the compared situations must be comparable but not identical. If these conditions are fulfilled, discrimination has occurred. According to the Arcelor case (para 25 and 26), comparability of situations should be evaluated in the light of the questioned provision´s aim. When it comes to national legislation in question, the aim is to help provide security for people in insecure employment situations due to fixed-term-contracts. In the present case, the ECJ accepted the arguments of the French Government and the defendant, saying that the situation of young students is not objectively comparable to that of other employees with fixed-term-contracts.
However, one may argue that some students’ situations are comparable to fixed-time workers when it comes to insecurity of their situations, even though they return to their studies after the vacations and are covered by the social security scheme. The Constitutional Court never assessed the financial impact of denying end-of-contract payment on students, with the knowledge that the French social scheme unevenly covers its students (circulaire n° 2015-101 du 9-6-201). Since, the social security scheme is dependent on the income of one’s parents, some students are less entitled to financial help than others or not entitled at all. Therefore, an additional 10% (the end of contract payment) could contribute a lot to the financial situation of some, especially if the student gets neither, or limited, social scheme nor parental aid. While the ECJ could have been unaware of the details of the national situation, one may assume that the Constitutional Council should have known about it. Therefore, the Constitutional Council ought to have realized that a blanket exception to such entitlement is not proportional or effective to reach the aim of the legislation. Actually, it risks discriminating those in comparable situations on the ground of age. An exception based on actual guaranteed income instead of age (young), connected to being a student, would be preferable since it limits the risks for discriminatory treatment.
Previously, the ECJ has also left it for the referring court to determine the comparability in the case [see Maruko para 80(2); Römer para 67(2)]. Theoretically, the ECJ is not supposed to decide on the merits of a case when it gives a preliminary ruling. In this case, the Court blankly accepted the Constitutional Council’s arguments and answered a question in substance, stating that two situations are de facto incomparable. Therefore, one could argue that the ECJ overstepped its determined role and acted ultra vires. Thus, it is questionable why the ECJ decided not to leave this interpretation for the referring court to decide, which would have been in line with the case law. The ECJ clearly missed an occasion to send back the case to the referring court for it to decide on the merits of the case.
Finally, it is an exceptional practice for the ECJ to decline jurisdiction with regards to preliminary rulings. In this case, it is questionable whether it was admissible since a preliminary question must derive from a genuine dispute and can not be a general or hypothetical question [Foglia para 11-13]. Due to the circumstances of the case, inter alia the defendant’s lack of interest, it was observed by the Court that the dispute could be fictitious. The Court, however, concluded that the dispute could be genuine, since the contract was completed, and therefore declared it admissible [para 15,16,19]. Here, one may argue that the Court missed out on an opportunity to decline the case already in the initial step when deciding on the admissibility. As such, the Court had not only one, but two different reasons to hand the case back to the referring court to decide on factual grounds. But it did not do so, either on the question of admissibility or on that of comparability.
Yasmin Semmane, Julia Steen and Anton Öberg