For some time now, the number of contracts for works and services – statistically seen – has increased beyond proportion. One of the reasons herefor is that the risks involved in the provision of temporary workers, such as the fiction of an employment relationship or the possible subsequent payment of social security contributions, can be reduced. Moreover, a central element of temporary work is the “equal pay” principle, to which contracts for works and services are not subject.
The growing number of contracts for works and services and the associated ensuing effects upon the permanent work force have for some time been a focus of unions and have now also gained political support: On 19 February 2013 the SPD-Bundestag parliamentary group introduced a legislative proposal titled “Abusive use of contracts for works and services” aimed at preventing the escalation of contracts for works and services. The legislative proposal contains a multitude of modifications of existing statutory provisions. For example, an amendment of the German Temporary Employment Act is envisaged to the effect that, in cases of the existence of specific standardised circumstances, a presumption provision exists in support of the existence of the provision of temporary workers (instead of a contract for works and services). Moreover, it also regulates amongst other things an extension of operational co-determination, pursuant to which contracts for works and services, for example, would have to be presented to the works council prior to their conclusion.
Additionally, on 7 March 2013 the NGG union issued a black book on contracts for works and services titled “Few rights, low pay – how enterprises use (exploit) contracts for works and services”. The union demands – entirely in line with the legislative proposal of the SPD – the legislator’s prompt intervention.
In practice, it is already evident that pension insurance institutions are increasingly paying attention to contracts for works and services in social security audits. In some cases, a precise examination is conducted to determine whether a relationship of a contract for works and services is not in fact a disguised provision of temporary work in the light of how it is actually conducted. According to the aforementioned decision of the Regional Labour Court of Berlin-Brandenburg, it is evident that contracts for works and services are hardly tenable in areas where works contractors should work shifts.