cellent Collaboration Framework©

The most important questions and answers

“Provision of temporary staff, contract for work – these have caused a lot of uncertainty since the Daimler judgement in 2013. Why?”

Two IT specialists under contract at a service provider, while being formally freelance, brought a successful lawsuit against Daimler AG in 2013. Irrespective of contract type, the fundamental problem lay in the absence of a division between these external service providers and company staff.

“What is the real issue here?”

According to the current legal position, a division must exist between company and external staff in order to avoid suspicion of apparent temporary employment. The criteria for such a division are not precisely defined in law and are interpreted differently by different companies. The decisive issue is not only the contractual basis of such a division, but primarily how it works in practice, which often does not meet these criteria.

“Separation of external service providers and company staff – do you know the typical characteristics of this issue?”

  • Use of same premises
  • Use of customer-owned devices
  • Permanent access authorisation
  • No set work outcomes
  • Direct written/oral instructions
  • Use of in-house company e-mail address
  • Maintenance of fixed, prescribed working hours
  • Obligation to attend company meetings
  • Agreement of holiday and representation rules

“There is a threat of heavy penalties in the event of a breach of the law. Are you aware of this?”

Here are only two of the unpleasant consequences:

  • Subsequent assertion of rights deriving from labour law (e.g. paid holiday, special payments, and minimum pay according to collective agreement, overtime, and severance pay) by ‘converted’ service provider.
  • Back-payment of up to five years’ worth of social insurance contributions (employer and employee contributions) by the employer to the regional health insurance fund.