Thomas Specht and Others v Land Berlin and Bundesrepublik Deutschland.
Date: 2014-06-19
33. The Court has held, however, that that exception must be construed as covering measures — such as the equivalence of all or some of the constituent parts of pay and/or the level of pay in the Member States, or the setting of a minimum guaranteed wage — that amount to direct interference by EU law in the determination of pay within the European Union. On the other hand, it cannot be extended to any question involving any sort of link with pay; otherwise some of the areas referred to in Article 153(1) TFEU would be deprived of much of their substance ( Impact , C‑268/06, EU:C:2008:223, paragraphs 124 and 125, and Bruno and Others , C‑395/08 and C‑396/08, EU:C:2010:329, paragraph 37).
34. Consequently, it is necessary to draw a distinction between the term ‘pay’ as used in Article 153(5) TFEU and the same term ‘conditions, including … pay’ as used in Article 3(1)(c) of Directive 2000/78. The latter term forms part of the employment conditions and, as noted by the Advocate General in point 45 of his Opinion, it does not relate directly to the setting of a level of pay.
35. In the case of the German civil service, the amount of pay for each grade and step is determined by the competent national courts and the European Union has no competence in that regard. On the other hand, the national rules governing the methods of allocating those grades and steps cannot be severed from the material scope of Directive 2000/78.
37. In those circumstances, the answer to Question 1 is that Article 3(1)(c) of Directive 2000/78 must be interpreted as meaning that pay conditions for civil servants fall within the scope of that directive.
Questions 2 and 3
39. It is first necessary to consider whether the old version of the BbesG inherently engenders a difference in treatment on grounds of age, for the purposes of Article 2(1) of Directive 2000/78. In that regard, it should be borne in mind that, under that provision, the ‘principle of equal treatment’ means that there is to be no direct or indirect discrimination whatsoever on any of the grounds referred to in Article 1 of the directive. Article 2(2)(a) of Directive 2000/78 specifies that, for the purposes of applying Article 2(1), direct discrimination is to be regarded as occurring where one person is treated less favorably than another in a comparable situation, on the basis of any of the grounds referred to in Article 1 of that directive.
41. As noted by the referring court, application of the step progression system laid down in Paragraph 27 of the old version of the BbesG, in conjunction with the method for calculating seniority laid down in Paragraph 28 of that law, has the effect, for example, that a person appointed at the age of 21 as a permanent civil servant in the service of the Federal State or Land Berlin would have started on step 1 of grade A11, whereas a person who did not join the civil service until the age of 23 would have been allocated step 2 of that grade.
42. In such cases, as the Court found in paragraph 58 of Hennigs and Mai (C‑297/10 and C‑298/10, EU:C:2011:560), the basic pay awarded to two civil servants appointed on the same day in the same grade, whose professional experience is the same or equivalent but whose ages are different, will differ according to their age at the time of appointment. It follows that those two civil servants are in a comparable situation, but that one of them receives less by way of basic pay than the other.
43. This means that the remuneration system established by Paragraphs 27 and 28 of the old version of the BbesG gives rise to a difference in treatment that is directly based on age, for the purposes of Article 2(1) and (2)(a) of Directive 2000/78.
44. Secondly, it is necessary to consider whether that difference in treatment may be justified under Article 6(1) of Directive 2000/78.
45. The first subparagraph of Article 6(1) states that Member States may provide that a difference of treatment on grounds of age is not to constitute discrimination, if, within the context of national law, it is objectively and reasonably justified by a legitimate aim, including legitimate employment policy, labour market and vocational training objectives, and if the means used to achieve that aim are appropriate and necessary.
46. The Court has consistently held that Member States may provide for measures entailing differences of treatment on grounds of age, in accordance with the first subparagraph of Article 6(1) of Directive 2000/78. They enjoy broad discretion in their choice, not only to pursue a particular aim in the field of social and employment policy, but also in the definition of measures capable of achieving it (see Palacios de la Villa , C‑411/05, EU:C:2007:604, paragraph 68, and Rosenbladt , C‑45/09, EU:C:2010:601, paragraph 41).
47. According to the German Government, the difference in treatment found in paragraph 43 above is justified by the aim of rewarding previous professional experience in a standard manner, whilst guaranteeing a uniform administrative practice.
48. In that regard, the Court has held that, as a general rule, the aim of rewarding experience that enables a worker to perform his duties better is a legitimate aim of wages policy ( Hennigs and Mai , EU:C:2011:560, paragraph 72 and the case-law cited).
49. It is still necessary to determine, in the light of the wording of Article 6(1) of Directive 2000/78, whether, in the context of the broad discretion enjoyed by Member States and referred to in paragraph 46 above, the means used to achieve that aim are appropriate and necessary.
50. In that connection, the Court has accepted that, as a general rule, recourse to the criterion of length of service is an appropriate means of achieving that aim, since length of service goes hand in hand with professional experience. Although the measure at issue in the main proceedings enables a civil servant to move up the steps of his grade as his age advances and his length of service accordingly increases, it is clear that, at the time of appointment, the sole criterion on the basis of which a particular step in a particular grade is initially allocated to a person with no professional experience is age (see, to that effect, Hennigs and Mai , EU:C:2011:560, paragraphs 74 and 75).
51. In such cases, as the Court observed in paragraph 77 of Hennigs and Mai  (EU:C:2011:560), it follows that the allocation, on the basis of age, of a basic pay step to a civil servant upon his appointment goes beyond what is necessary for achieving the legitimate aim, relied on by the Ger man Government, of taking account of the professional experience acquired by that civil servant before he is appointed.
52. In the light of the foregoing considerations, the answer to Questions 2 and 3 is that Articles 2 and 6(1) of Directive 2000/78 must be interpreted as precluding a national measure, such as that at issue in the main proceedings, under which, within each service grade, the step determining basic pay is to be allocated, at the time of recruitment, on the basis of the civil servant’s age.
Questions 6 and 7
56. Under the Law establishing the Land Berlin transitional system, each established civil servant is to be allocated a step, or a transitional step, on the basis of the post held on 31 July 2011 and the basic pay that would accrue to him on 1 August 2011. He is to be allocated the step or transitional step that corresponds to the amount received by way of basic pay, rounded up to the next unit.
57. As regards the question whether the Law establishing the Land Berlin transitional system establishes a difference in treatment on grounds of age for the purposes of Article 2(1) and (2) of Directive 2000/78, it can be seen from the orders for reference that the allocation of a transitional step to established civil servants ensured that they received a reference pay in an amount equivalent to that received under the old version of the BbesG. The pay received under that earlier legislation was principally made up of the basic pay that had been calculated, at the time of appointment, solely on the basis of the civil servant’s age. As stated in paragraph 43 above, the method of calculating basic pay gave rise to a difference in treatment directly based on age, for the purposes of Article 2(1) and (2)(a) of Directive 2000/78.
58. Accordingly, by determining the basic pay on the basis of the pay previously received by established civil servants, which depended on seniority, the scheme put in place by the Law establishing the Land Berlin transitional system perpetuated a discriminatory situation whereby some civil servants receive lower pay than other civil servants, even though they are in comparable situations, solely on account of their age at the time of appointment (see, by analogy, Hennigs and Mai , EU:C:2011:560, paragraph 84).
59. That difference in treatment is liable to be perpetuated by the new Law on the remuneration of Land Berlin civil servants, since the definitive reclassification of established civil servants took place on the basis of the step or of the transitional step allocated to each civil servant (see, by analogy, Hennigs and Mai , EU:C:2011:560, paragraph 85).
63. According to the orders for reference and the observations of the German Government, the Law establishing the Land Berlin transitional system pursues the aim of protecting the acquired rights and the legitimate expectations of civil servants as to the future progression of their remuneration. The German Government argues in particular that, as part of the participation procedure related to the adoption of the Law reforming the remuneration of Land Berlin civil servants, the unions insisted on the preservation of acquired rights and demanded supplementary provisions to guarantee this. According to the German Government, a draft law that would not have ensured the preservation of those rights would have met with opposition from unions, which would have seriously compromised its prospects of adoption.
64. First of all, it should be noted that protection of the acquired rights of a category of persons constitutes an overriding reason in the public interest ( Commission  v Germany , C‑456/05, EU:C:2007:755, paragraph 63 and Hennigs and Mai , EU:C:2011:560, paragraph 90).
65. As regards, next, the appropriateness of the Law establishing the Land Berlin transitional system, it should be observed that the German Government has argued that the old version of the BbesG was, for most established civil servants, given the typical career paths of that time, more favourable than the new Law on the remuneration of Land Berlin civil servants. Accordingly, the placement of established civil servants directly within the scheme under that new law would have caused many of them to incur a loss in salary, estimated to be equivalent to at least one step, that is to say, depending on the grade, in an amount approximately equivalent to EUR 80 to EUR 150.
66. Secondly, as is apparent from Paragraph 2(2) of the Law establishing the Land Berlin transitional system, established civil servants were allocated a step corresponding to their previous basic pay rounded up to the next unit.
67. In those circumstances, it must be found that the preservation of previous remuneration and, as a consequence, the preservation of a scheme establishing a difference in treatment based on age made it possible to prevent loss of remuneration and, as is apparent inter alia from paragraph 63 above, were a crucial factor in enabling the domestic legislature to arrange the transition from the system under the old version of the BbesG to the system under the new Law on the remuneration of Land Berlin civil servants.
68. A law such as the Law establishing the Land Berlin transitional system thus appears suited to achieving the aim pursued, that is to say, to ensure the preservation of acquired rights.
69. Lastly, it remains necessary to determine whether or not such a law goes beyond what is necessary to achieve that aim.
70. The referring court notes in this respect that it would have been preferable either to apply the new scheme retroactively to all established civil servants or to apply a transitional system guaranteeing an established civil servant and in a favoured position the same level of pay as he received previously until he has gained the experience required to qualify for higher pay under the new scheme.
71. In order to determine whether a law such as the Law establishing the Land Berlin transitional system goes beyond what is necessary to achieve the aim pursued, that law must be placed in its context and the damage that it is liable to cause for the persons concerned must be considered ( HK Danmark , C‑335/11 and C‑337/11, EU:C:2013:222, point 89).
72. As regards, in the first place, the context in which the Law establishing the Land Berlin transitional system was adopted, it should be noted that, according to the requests for a preliminary ruling, even before the judgment in Hennigs and Mai  (EU:C:2011:560) was delivered, the competent national legislative authorities repealed the old version of the BbesG and, in order to eliminate the discrimination on grounds of age which flawed that legislation, reformed the system for the remuneration of federal civil servants and those of Land Berlin.
73. It was against that background that the Law establishing the Land Berlin transitional system was adopted, which provides — as its title suggests — for a transitional derogation for established civil servants. The allocation of steps or transitional steps to those civil servants was immediate and, following their definitive reclassification under the new Law on the remuneration of Land Berlin civil servants, their pay progression depends exclusively on the criteria specified in that law, that is to say, on professional experience and on performance, which means that age is no longer a factor.
74. The German Government notes that that reform, adopted in the context of Land Berlin’s high indebtedness, and at national level, in the context of a general attempt at budgetary consolidation, had to be made at neutral cost. Moreover, owing to the high number of civil servants to be reclassified, the transition to the new system had to take place without excessive use of administrative resources, that is to say, as far as possible, without requiring case-by-case consideration.
75. The German Government submits in that regard that it would have had to examine over 65 000 individual cases in order to determine the appropriate ‘experience step’ under Paragraphs 27 and 28 of the new Law on the remuneration of Land Berlin civil servants, before calculating whether or not that reclassification was more favourable than allocation on the basis of the Law establishing the Land Berlin transitional system. That examination would have taken approximately 360 000 hours to complete.
76. The German Government adds that it was no longer possible, for a relatively high number of civil servants who had to be reclassified, to determine — a posteriori  and individually — the periods of activity preceding their establishment as civil servants that they could validly claim. It would therefore have been necessary, depending on the circumstances, either wholly to discount such periods or to recognise them without proof, which, depending on the case, would have either penalised the civil servants outright or afforded them an outright advantage. That would have led in turn to an outcome that was arbitrary and, as such, unacceptable.
77. It should be borne in mind that, as a rule, justifications based on an increase in financial burdens and possible administrative difficulties cannot justify failure to comply with the obligations arising out of the prohibition of discrimination on grounds of age laid down in Article 2 of Directive 2000/78 (see, by analogy, Erny , C‑172/11, EU:C:2012:399, paragraph 48).
78. However, an individual examination of each particular case cannot be insisted on in order to establish, a posteriori  and individually, previous periods of activity, since the management of the scheme concerned must remain technically and economically viable (see, by analogy, Dansk Jurist- og Økonomforbund , C‑546/11, EU:C:2013:603, paragraph 70).
79. That finding is necessary in view of the particularly high number of civil servants, the length of the period concerned, the diversity of their respective backgrounds and the difficulties that may have arisen in connection with the determination of earlier periods of activity that those civil servants could validly have claimed. It can therefore be accepted that the method entailing examination of the individual case of each established civil servant would have been excessively complex and would have involved a high risk of error.
80. In those circumstances, it must be held that the domestic legislature did not exceed the limits of its discretion by taking the view that it was neither realistic nor desirable to apply the new classification system retroactively to all established civil servants or to apply a transitional system guaranteeing an established civil servant and in a favoured position the same level of pay as he received previously until he has gained the experience required to qualify for higher pay under the new scheme.
81. As regards, in the second place, the damage that a law such as the Law establishing the Land Berlin transitional system could cause to the persons that it concerns, it is clear that, in the light of paragraphs 75 and 76 above and the lack of a valid point of reference — making it possible to compare the situation of civil servants who would benefit with the situation of those who would not — that damage is particularly difficult to determine.
82. It has also been argued before the Court that the difference in remuneration is contained owing to the limits, specific to German civil service law, placed on the age at which civil servants can be appointed. It accordingly emerges from the observations of the German Government that, in the cases before the referring court, an age limit of 35 years applied and that, accordingly, any disparities in pay would not be as wide as the difference between the first and the last step in a grade.
83. Moreover, although it can be seen from the orders for reference that the effect of the Law establishing the Land Berlin transitional system is that the difference in remuneration is maintained at almost the same level until the established civil servants reach the highest step in their respective grades, those orders for reference nevertheless do not contain more precise or specific information in that regard. The German Government has relied, for its part, on the existence of two mechanisms which — it contends — mitigate, or even eliminate, the difference in treatment brought about by allocating two civil servants different steps because of their age. According to the German Government, reducing the number of steps and reallocating civil servants a step corresponding to the previous basic salary, rounded up to the next unit, would have the effect that the difference in pay would diminish, and, in some cases, fade away after a few years.
84. In view of the information provided in the orders for reference and in the documents produced before the Court, such a possibility cannot be discounted.
85. In those circumstances, it does not appear that, by adopting the transitional derogation measures put in place by the Law establishing the Land Berlin transitional system, the domestic legislature went beyond what was necessary to achieve the aim pursued.
86. The answer to Questions 6 and 7, therefore, is that Articles 2 and 6(1) of Directive 2000/78 must be interpreted as not precluding domestic legislation, such as that at issue in the main proceedings, laying down the detailed rules governing the reclassification within a new remuneration system of civil servants who were established before that legislation entered into force, under which the pay step that they are now allocated is to be determined solely on the basis of the amount received by way of basic pay under the old system, notwithstanding the fact that that amount depended on discrimination based on the civil servant’s age, and advancement to the next step is now to depend exclusively on the experience acquired after that legislation entered into force.
Question 4
88. At the outset, it is important to recall the obligation that national law must be interpreted in conformity with EU law, which requires national courts to do whatever lies within their jurisdiction, taking the whole body of domestic law into consideration and applying the interpretative methods recognised by it, with a view to ensuring that Directive 2000/78 is fully effective and to achieving an outcome consistent with the objective pursued by it (see, to that effect, Lopes Da Silva Jorge , C‑42/11, EU:C:2012:517, paragraph 56).
89. If it is not possible to construe and apply the national legislation in conformity with the requirements of Directive 2000/78, it should also be borne in mind that, by reason of the principle of the primacy of EU law, which extends also to the principle of non-discrimination on grounds of age, conflicting national legislation which falls within the scope of EU law must be disapplied (see Kücükdeveci , C‑555/07, EU:C:2010:21, paragraph 54 and the case-law cited).
90. However, in its orders for reference, the referring court states that, in its view, it is impossible to interpret Paragraphs 27 and 28 of the old version of the BbesG in conformity with EU law.
91. The referring court also notes that, by applying the interpretative methods recognised under German law, it is unable to close the gap created by the non-application of national provisions that are contrary to the principle of non-discrimination. That court also notes that, unlike the situation in the case that gave rise to the judgment in Hennigs and Mai  (EU:C:2011:560), the German law applicable in the cases before it does not permit it to grant civil servants who have been discriminated against a right to payment of the difference between their pay and that of civil servants who, because of their age, were allocated a higher step.
92. In addition, it is not possible for the referring court to allocate a lower step retroactively to the oldest civil servants because of considerations relating to the protection of legitimate expectations and acquired rights.
93. Referring to Terhoeve (C‑18/95, EU:C:1999:22, paragrap h 57) and Landtová (C‑399/09, EU:C:2011:415, paragraph 51), the referring court wonders, however, whether, given that discrimination contrary to EU law has been found, the only way of ensuring observance of the principle of equal treatment is, pending the adoption of measures reinstating equal treatment, to grant persons within the disadvantaged category the same advantages as those enjoyed by persons within the favoured category.
94. In the first place, it should be noted that it is for the national court to determine the legal implications of the finding that legislation such as that at issue before it does not comply with Directive 2000/78.
95. In the second place, as regards Terhoeve  (EU:C:1999:22) and Landtová  (EU:C:2011:415), the Court essentially held that, where national law, in infringement of EU law, provides for different treatment as between groups of people and for as long as measures reinstating equal treatment have not yet been adopted, observance of the principle of equality can be ensured only by granting to the persons within the disadvantaged category the same advantages as those enjoyed by the persons within the favoured category. The Court also stated, in the context of those cases, that the arrangements applicable to members of the favoured group remained, for want of the correct application of EU law, the only valid point of reference.
96. It should be noted that that approach is intended to apply only if there is such a valid point of reference. However, it should be noted that there is no such valid point of reference in the context of legislation such as that at issue in the main proceedings, under which it is not possible to identify a category of favoured civil servants. Paragraphs 27 and 28 of the old version of the BbesG apply to all civil servants upon their appointment and, as is apparent from paragraph 42 above, the discriminatory aspects arising from those provisions potentially affect all civil servants.
97. It follows that the case-law referred to in paragraphs 93 and 95 above is not applicable to the cases before the referring court.
98. In the third place, it should be borne in mind that, according to settled case-law, the principle of State liability for loss and damage caused to individuals as a result of infringements of EU law for which the State can be held responsible is inherent in the system of the treaties on which the European Union is based (see, to that effect, Francovich and Others , EU:C:1991:428, paragraph 35; Brasserie du pêcheur and Factortame , C‑46/93 and C‑48/93, EU:C:1996:79, paragraph 31; and Transportes Urbanos y Servicios Generales , C‑118/08, EU:C:2010:39, paragraph 29).
99. In that connection, the Court has held that the individuals harmed have a right to reparation where three conditions are met: the rule of EU law infringed must be intended to confer rights on them; the breach of that rule must be sufficiently serious; and there must be a direct causal link between the breach and the loss or damage sustained by the individuals (see, to that effect, Transportes Urbanos y Servicios Generales , EU:C:2010:39, paragraph 30).
100. In principle, it is for the national courts to apply the conditions for establishing the liability of Member States for damage caused to individuals by infringements of EU law, in accordance with the guidelines laid down by the Court for the application of those conditions (see Test Claimants in the FII Group Litigation , C‑446/04, EU:C:2006:774, paragraph 210 and the case-law cited).
101. As regards the first condition, suffice it to note that Article 2(1) of Directive 2000/78, read in conjunction with Article 1 of that directive, prohibits, in a general and unambiguous manner, all direct or indirect discrimination, as regards employment and occupation, that is not objectively justified and that is based, inter alia, on the worker’s age. Those provisions are intended to confer on individuals rights that are enforceable against Member States.
102. As regards the second condition, the Court has made it clear that a sufficiently serious infringement of EU law is established where it implies that the Member State had a manifest and grave disregard for the limits set on its discretion, the factors to be taken into consideration in that connection being, inter alia, the degree of clarity and precision of the rule infringed and the measure of discretion that the rule leaves to the national authorities ( Synthon , C‑452/06, EU:C:2008:565, paragraph 37 and the case-law cited). The discretion enjoyed by the Member State thus constitutes an important criterion in determining whether there has been a sufficiently serious infringement of EU law ( Robins and Others , C‑278/05, EU:C:2007:56, paragraph 72).
103. In order to determine whether an infringement of Article 2 of Directive 2000/78 on the part of the Member State concerned was sufficiently serious in the cases before it, the national court must take into account the fact that the first subparagraph of Article 6(1) of that directive allows Member States freedom to make provision for measures that involve differences in treatment directly based on age, and broad discretion in their choice, not only to pursue a particular aim in the field of social and employment policy, but also in the definition of measures capable of achieving it.
104. It should be noted that the nature and extent of the obligation on Member States under Articles 2(2) and 6(1) of Directive 2000/78 in respect of national legislation such as the old version of the BbesG have been clarified and defined from the date on which the judgment in Hennigs and Mai  (EU:C:2011:560) was delivered.
105. In that regard, it must be recalled that, although the interpretation that the Court gives to a rule of EU law, in the context of a request for a preliminary ruling, clarifies and defines, where necessary, the meaning and implications of that rule as it must be, or ought to have been, understood and applied from the time of its entry into force (see, to that effect, inter alia, RWE Vertrieb , C‑92/11, EU:C:2013:180, paragraph 58), it is up to the national court to decide whether, nevertheless, the nature and extent of the obligations on Member States under Article 2(2) of Directive 2000/78 in respect of legislation such as that at issue in the main proceedings could not be considered to be clear and precise until the date of the judgment in Hennigs and Mai  EU:C:2011:560, that is to say, not until 8 September 2011 (see, by analogy, Hogan and Others , C‑398/11, EU:C:2013:272, paragraphs 51 and 52). In some circumstances, it would have to be held that there was no sufficiently serious infringement before that date.
106. As regards the third condition for State liability for an infringement of EU law, it is for the referring court to establish whether — as the documents before the Court appear to suggest — there is a direct causal link between that infringement and the damage that the applicants in the main proceedings may have suffered.
107. Accordingly, it is for the referring court to ascertain whether all the conditions, laid down by the case-law of the Court, are met for the Federal Republic of Germany to have incurred liability under EU law.
111. As noted by the Advocate General in point 111 of his Opinion, Article 9 of Directive 2000/78 provides that Member States are to ensure that judicial and/or administrative procedures for the enforcement of obligations under the directive are available to all persons who consider themselves wronged by failure to apply the principle of equal treatment to them and that those obligations of the Member States are without prejudice to national rules relating to time-limits for bringing actions as regards that principle. It follows from the wording of that provision that the question of time-limits for initiating a procedure for the enforcement of obligations under Directive 2000/78 is not governed by EU law.
112. It must be borne in mind that, according to settled case-law of the court, in the absence of relevant EU rules, the detailed procedural rules designed to ensure the protection of the rights that individuals acquire under EU law are a matter for the domestic legal order of each Member State, in accordance with the principle of the procedural autonomy of the Member States, provided that they are not less favourable than those governing similar domestic situations (principle of equivalence) and that they do not make it in practice impossible or excessively difficult to exercise rights conferred by the EU legal order (principle of effectiveness) (see, inter alia, Meilicke and Others , C‑262/09, EU:C:2011:438, paragraph 55, and Pelati , C‑603/10, EU:C:2012:639, paragraph 23).
113. As regards the principle of equivalence, it should be noted that, as regards the cases before the referring court, there is nothing in the information before the Court to suggest that a rule such as that at issue in those cases may not be consistent with that principle.
114. As regards the principle of effectiveness, the Court has held that it is compatible with EU law to lay down reasonable time-limits for bringing proceedings, in the interests of legal certainty, which protects both the taxpayer and the administration concerned. Such time-limits do not make it in practice impossible or excessively difficult to exercise the rights conferred by EU law ( Meilicke and Others , EU:C:2011:438, paragraph 56 and the case-law cited).