The die is cast. On 5 April 2013, the Dutch Supreme Court rendered the long-awaited judgment in the case of Albron Nederland / FNV Bondgenoten et al. The Supreme Court has denied Albron’s appeal in cassation and upheld the earlier judgment of the Amsterdam Court of Appeal.
What was this case about?
In 2005 Heineken Nederland outsourced its catering activities to Albron. The catering employees were employed by the personnel company Heineken Nederlands Beheer and permanently seconded to Heineken Nederland. Albron employed the catering employees, but under considerably worse terms of employment.
The catering employees felt that a transfer of undertaking had taken place within the meaning of Section 7:663 of the Civil Code, and they were supported by the trade union FNV Bondgenoten. This Section is the implementation of a European Directive. The employees argued that their employment agreement had been transferred to Albron by operation of law and that their entitlement to their former terms of employment remained. Albron argued against this that Section 7:663 of the Civil Code requires the catering employees to have an employment agreement with the outsourcing party, which they have not.
Interpretation of the Directive
Legal proceedings of many years followed, in which the Amsterdam Court of Appeal eventually asked the European Court of Justice for an interpretation of the Directive. We have discussed the interpretation of the European Court in a previous article (see: ‘Albron; The Transferor, the Employment Relationship and the Principle of Protection’). In brief, the European Court held that in a case like this, the Directive does not prevent the non-contractual employer, to which employees are assigned on a permanent basis, from being subject to the Directive as well.
Next, on the basis of this answer the Amsterdam Court of Appeal interpreted Section 7:663 of the Civil Code such that Heineken Nederland can be regarded as an employer within the meaning of that provision, so that the rights and obligations of Heineken Nederland have been transferred to Albron as a consequence. The Court of Appeal considered expressly that there was no ground to deviate from the starting point that the court is obliged to interpret national legislation in conformity with the Directive.
Interpretation in Conformity with the Directive
This last aspect is at the heart of the cassation proceedings. Albron argued that the Amsterdam Court of Appeal had overstepped the boundaries of interpretation in conformity with the Directive, since the Court of Appeal’s opinion would come down to an interpretation ‘contra legem’ (contrary to Dutch law) and would be contrary to the principle of legal certainty. The Supreme Court rejected these arguments, since it had to be assumed on the basis of the legislative history that the legislator did not wish to deviate from the Directive. In this connection, the Supreme Court emphasized that the wording of a legal provision is not always decisive to its interpretation. In this case, in view of the intention of the legislator, the wording of the provision (deviating from the Directive) deserves less meaning. So, according to the Supreme Court, the Court of Appeal has rightly interpreted Section 7:663 of the Civil Code in conformity with the Directive. This means that the fact that during the transfer of undertaking the catering employees were not employed by that undertaking does not prevent Section 7:663 of the Civil Code from applying.
Many things are still not clear about the consequences of the Albron judgment for payrolling, temporary workers and seconded workers, for example. See also our previous article (‘Albron; The Transferor, the Employment Relationship and the Principle of Protection’) in which we attempted to answer various questions. In any case, it should be taken into account in corporate relations that employees who have been seconded permanently may nevertheless be transferred by operation of law if their work is outsourced.