temporary agency work

Which translation, when

Why

Temporary agency work is die Arbeitnehmerüberlassung, and Germany regulates it more tightly than most systems, which makes the translation a compliance question rather than a vocabulary one. The starting point is the permit. An employer who hires out his employees to third parties commercially needs authorisation from the Federal Employment Agency, and the consequence of acting without it is not a fine alone: the contract between the agency and the hirer is void, and unless the worker declares within the statutory period that he wishes to keep his contract with the agency, a declaration the statute surrounds with formalities including presentation at the employment agency, the law deems an employment relationship to have come into existence between the worker and the hirer, so the client acquires an employee he never meant to engage. Two further limits shape the arrangement. The same worker may not be placed with the same hirer beyond the statutory maximum period, and once a transitional stretch has passed he is entitled to the essential working conditions, including pay, that apply to comparable employees of the hirer, the principle known as equal treatment and equal pay. Both can be modified by collective agreement within the bounds the Act sets, which is why the applicable sector agreement, not the statute alone, tells a reader how long a placement may run in practice. The trap that catches foreign groups is the disguised arrangement. Calling the contract a Werkvertrag or a services agreement does not change its nature where the worker is integrated into the hirer’s organisation and follows his instructions, and the Act requires the parties to designate the arrangement expressly and to identify the worker, so a mislabelled contract triggers precisely the consequences the permit regime attaches to unlicensed hiring.

Typical mistakes

• Hiring out employees commercially requires a permit, and without one an employment relationship is deemed to arise with the hirer, so the risk falls on the client rather than only on the agency.
• The maximum placement period and equal treatment may be modified by collective agreement, so the statutory figures alone do not describe what applies in a given sector.
• Labelling the contract a Werkvertrag does not avoid the rules where the worker is integrated into the hirer’s organisation.

What matters

Structuring the supply of workers to a German site: the review should confirm the agency’s permit, designate the arrangement as Arbeitnehmerüberlassung in the contract, and check the applicable collective agreement for the placement period and pay equality.

Examples