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Court of Justice 11-07-1990 ECLI:EU:C:1990:298

Court of Justice 11-07-1990 ECLI:EU:C:1990:298

Data

Court
Court of Justice
Case date
11 juli 1990

Opinion of Mr Advocate General Lenz

delivered on 11 July 1990(*)

Mr President,

Members of the Court,

Facts

In the present case the Hellenic Republic is accused of having failed to adopt by the prescribed date of 23 October 1983 adequate measures to transpose Council Directive 80/987/EEC of 20 October 1980 on the approximation of the laws of the Member States relating to the protection of employees in the event of the insolvency of their employer (Official Journal 1980 L 283, p. 23 et seq.), a directive which the Court has already considered in Case 22/87.(*)

I refer to the Report for the Hearing for the details of the case, in particular the content of the abovementioned directive and the background to the dispute. At this juncture I would briefly recall only the following.

The Hellenic Republic defended itself against the Commission's complaint by submitting, first of all, that the requirements of the directive were met by Greek Law No 1172/81. That argument was rejected by the Commission — which has subjected the law to a detailed examination — in its letter of 28 April 1986 (formally opening the procedure under Article 169 of the EEC Treaty) and in its reasoned opinion of 9 June 1987 (calling on the Hellenic Republic to adopt the necessary measures within one month of receipt of the opinion).

It is noteworthy that the defendant's only reaction was to indicate in a letter of 23 July 1987 — before this action was brought — that the Ministry of Labour had prepared the draft presidential decree which was to transpose the directive. In my view, that can only be seen as a departure from the line of defence which had been followed until that time.

Accordingly, the defence to the Commission's action (the application having again considered in detail the abovementioned Law No 1172/81) essentially refers only to the aforementioned draft presidential decree. The rejoinder, which also makes no mention of Law No 1172/81, states that the adoption of the presidential decree transposing the directive is imminent.

Following a question asked by the Court, we learned only in November 1989 that the abovementioned draft presidential decree had been abandoned because of the lack of appropriate enabling provisions for the establishment of the guarantee institution provided for in Directive 80/987. At the same time it was explained that Greek legislation had been adapted to the directive by Law No 1836/89, Article 16 of which provided for the adoption of a presidential decree which would settle all the details of the guarantee institution. Finally, in January 1990 the lext of a presidential decree intended to remedy the alleged infringement was submitted to the Court.

Analysis

In view of the defendant's legislative activity, it may be observed first of all that even during the written procedure the defendant itself obviously did not consider that it had done everything necessary to transpose the directive at issue before the expiry of the time-limit laid down in the directive or in the reasoned opinion, the corollary of which is that the claim made by the Commission in its application is in principle to be regarded as well founded. The Commission has in fact already demonstrated in its reasoned opinion, and again in the application, that Law No 1172/81 does not suffice to transpose the directive. I need not go into that again in detail here, but would refer to the Report for the Hearing in which the Commission's arguments are set out.

To that extent, therefore, the Commission's application should be granted.

Nor is it necessary to consider whether Law No 1836/89 and the presidential decree adopted under that law satisfactorily transpose the directive into Greek law. According to the relevant case-law, under which it is essentially the Commission's letter initiating the procedure and its reasoned opinion that are at issue, that question is not the subject-matter of the present proceedings. These proceedings actually concern only the legal situation up to the date when the time-limit laid down in the reasoned opinion expired. Thus, if the Commission were to conclude that Law No 1836/89 and the presidential decree adopted pursuant thereto did not suffice to implement the directive, it would have to bring fresh proceedings and give the defendant an opportunity to submit its observations on the issue before it was brought before the Court of Justice.

From the content of the application it appears that the only question still to be considered in the present proceedings is whether the situation pertaining in Greek law is satisfactory in respect of certain categories of employee, with regard to which Article 1(2) of the directive states:

‘Member States may, by way of exception, exclude claims by certain categories of employee from the scope of this directive, by virtue of the special nature of the employee's contract of employment or employment relationship or of the existence of other forms of guarantee offering the employee protection equivalent to that resulting from this directive.’

In that regard mention should be made of Section I of the annex to the directive — entitled ‘Employees having a contract of employment, or an employment relationship, of a special nature’ — part A of which, with regard to Greece, refers to: ‘The master and the members of a crew of a fishing vessel, if and to the extent that they are remunerated by a share in the profits or gross earnings of the vessel’; Section II — entitled ‘Employees covered by other forms of guarantee’ — part A of which, with regard to Greece, refers to: ‘The crews of sea-going vessels’.

As the Court is aware, the Commission's view, at least during the written procedure, was that that question must also be answered in the negative because the interests of neither of the abovementioned categories of employee enjoyed equivalent protection (in the oral procedure the Commission appears to have moderated its position with regard to the first category). As early as 23 July 1987, in its reply to the Commission's reasoned opinion of 5 and 9 June 1987, the defendant emphatically disputed that view by referring to Law No 1711/87, amending the rules governing the seamen's pension fund. Article 207 of the Private Maritime Law Code was, it was claimed, thereby amended in such a way that all the problems connected with the annex to the directive were solved.

With regard to this problem — the only one remaining to be considered in the present case — I consider — having regard to the Commission's representative's statement in the oral procedure that Greece had excluded the employees in question from the scope of the directive (in the written procedure the absence of clear provisions on the exclusion of those employees was criticized) — that, as regards the first category, the opinion initially expressed by the Commission cannot be upheld and that criticism may be properly made only in respect of the second category.

It is quite clear that the abovementioned Article 1(2) of the directive, which refers to the possibility of excluding certain employees, draws a clear distinction between two groups: the first group is distinguished by a particular form of employment contract or employment relationship, and the existence of other forms of guarantee offering equivalent protection is mentioned only with reference to the second category. Accordingly, in the list in the annex to the directive there is a clear-cut division of employees into the aforementioned categories, which would obviously have been pointless if the authors of the directive had intended them to be treated in the same way. Moreover, a number of examples from Section I of the annex to the directive entitled ‘Employees having a contract of employment, or an employment relationship, of a special nature’ can be cited to rebut the Commission's opinion (also in so far as it assumes that equivalent protection is required for the first group as well); these examples — such as close relatives of the employer, persons who normally work for less than 18 hours a week, the spouse of the employer, domestic servants working less than three days a week — make it quite clear that for them, having regard to the nature of the employment relationship, it does not appear appropriate to provide for equivalent guarantee institutions in order to safeguard remuneration.

The fact that the master and the members of the crew of a fishing vessel referred to under Section I A of the annex do not, under Greek law, enjoy protection which is equivalent to the protection prescribed by the directive — assuming that that assertion is true (which need not be examined any further here) — is certainly no reason to refer to incorrect transposition of the directive.

On the contrary, no implementation of the directive was necessary in that regard, and there was also no possibility of communicating the text of such an implementing provision to the Commission (Article 11(2) of the directive). The fact that the Hellenic Republic believed that it had not implemented the directive until it had adopted Article 207 of the Code of Maritime Law — which would have raised the question whether implementation and communication had been made in good time — is immaterial.

Consequently, it must be held that the complaint that the defendant failed to adopt the necessary measures to implement the provision of Article 1(2) in conjunction with Section I A of the annex to the directive within the prescribed time-limit must be rejected.

Turning to the question whether such equivalent protection is afforded to the crews of sea-going vessels referred to in Section II A of the annex, I would first make the general point that the relevant derogation in Article 1(2) of the directive must, in view of its wording, doubtless be interpreted strictly. Therefore as regards:

  1. the payment of remuneration for a minimum period of three months after the onset of insolvency (Article 4),

  2. ensuring that the non-payment of compulsory contributions to statutory social security schemes does not adversely affect employees' benefit entitlement (Article 7), and

  3. the matters regulated by Article 8 of the directive (benefits paid under supplementary company or intercompany pension schemes),

I agree with the Commission that means other than those expressly provided for in the directive must afford protection of a degree and effectiveness which is essentially comparable to the protection indicated by the directive.

On that basis it very soon becomes evident that the provisions relied upon by the defendant do not satisfy that condition with regard to the crews of sea-going vessels.

That applies for Article 205 of the Code of Private Maritime Law (which provides that when a ship is compulsorily auctioned seamen have a second-priority claim after judicial costs, taxes and similar) and Article 207 of the Code of Private Maritime Law, as amended by Law No 1711/87, which provides that in the event of the contractual assignment of a vessel seamen may make their preferential claims within one year.

It was rightly objected that giving second priority after judicial costs and fiscal claims is very often inadequate because even when expensive ships are auctioned there is not always enough left over to satisfy second-priority claims as well.

On the other hand, the defendant has submitted that principles of national law do not permit seamen's claims to be accorded first priority. Neither that argument nor the reference to the fact that the Brussels Convention of 1926 for the Unification of certain Rules relating to Maritime Liens and Mortgages, to which Greece is a signatory, provides — as does a new convention to be negotiated — that seamen's preferential claims are to be given only second priority carries any weight.

That is plain from the established case-law (which precludes justification of infringements of the Treaty by pleading provisions, practices or circumstances existing in the national legal system). Furthermore, if it is to be assumed that the Brussels Convention is binding in the above sense, it is open to the defendant to provide other safeguards for seamen which satisfy the directive.

The Commission has also rightly pointed out the unsatisfactory situation whereby the protection afforded by the abovementioned articles of the Code of Private Maritime Law does not come into play until there is an auction, and does not cover — as required under the directive — the period from the onset of the employer's insolvency, which may arise much earlier.

The same assessment also applies for the four other groups of provisions on which the defendant has relied in this regard in the written procedure, namely:

  1. Law No 690 of December 1945 (which provides for a term of imprisonment for employers who fail to pay wages), because, as the Commission rightly pointed out, there is no deterrent effect since the term of imprisonment provided for is often commuted into a fine; it should also be borne in mind that that does not entail any guarantee of payment because precisely such cases frequently involve unreliable debtors;

  2. Law No 762 of March 1978 (which provides that employers' representatives are liable under civil law on conclusion of employment contracts), because it obviously does not afford adequate safeguards, in the event that the representatives are insolvent;

  3. Law No 373/1968 (under which shipowners who fail to meet the claims of the crew will be refused authorization to employ Greek seamen), because such a ban obviously does not protect existing claims, particularly as it can be circumvented by hiring foreign seamen;

  4. Article 81 of the Code of Private Maritime Law (under which a dismissed sailor is entitled to board and lodging on board until he receives the pay due to him), quite obviously does not guarantee the payment of wages.

In the oral procedure (as far as I can see, for the first time) the defendant also relied on Law No 1220/81 on the port authority of Piraeus (under which, apparently, seamen who are stranded abroad and whose wages are not paid will receive from the Maritime Pension Fund a part of their wages).

That may be regarded as a belated plea in law (on which the Commission has not, consequently, been able to answer) which must therefore be disregarded pursuant to Article 42(2) of the Court's Rules of Procedure.

However, the meagre explanations given in that regard are not such that there may be said to exist a guarantee of equivalent protection within the meaning of Article 1 of Directive 80/987, because that law — even if it does in fact lay down an obligation to pay wages for three months — contains no mention of the other fields covered by the directive (in Articles 7 and 8).

In response to that appraisal of the provisions relied on by the defendant, the latter — in my view wrongly — refers to negotiations which took place before the directive was adopted, with regard to which a Council working document was submitted with its defence.

That document does indeed show that the EEC-Greece Interim Committee considered the Greek delegation's request to have certain derogations included in the annex to the directive and decided to supplement the annex with the matter that was subsequently incorporated therein.

Moreover, the document speaks of the Greek Government ensuring that the claims of seamen vis-à-vis a shipowner could be made for a period of one year (which would entail a corresponding amendment of the abovementioned Article 207 of the Greek Code of Maritime Law in accordance with the Brussels Convention).

However, it is also clear that that document contains nothing to indicate that the latter was the only condition for ensuring equivalent protection within the meaning of Article 1(2) of the directive.

Furthermore, it is significant that in the oral procedure the Commission's representative expressly stated that the question whether there was equivalent protection for crews of sea-going vessels was not considered before the annex to the directive was supplemented having regard to the situation in Greek law.

That is plausible because such consideration would not have been easy in view of the manifold provisions to be taken into account in the various Member States. Moreover, it was not necessary, because Article 1 of the directive refers only to the possibility of excluding certain employees. Thus the directive does not itself directly implement such exclusion.

Furthermore, support for that view can also be found in the abovementioned judgment in Case 22/87, in which the annex to the directive also played a role — in that instance in relation to Italy. The Court considered that it was not sufficient that, in relation to Italy, Section II C of the annex refers to ‘Employees covered by benefits laid down by law guaranteeing that their wages will continue to be paid in the event that the undertaking is hit by an economic crisis’. The Court attached more importance to the fact that — and is this regard a specific check was considered necessary — it covered only those employees who actually benefited from the abovementioned law (which is not the case for all the workers covered in general terms by the law).

Conclusion

In conclusion, I can therefore only propose that the Court should make the declaration sought by the Commission in its application that the Hellenic Republic has failed to fulfil its obligations under the EEC Treaty in so far as it did not adopt and notify to the Commission, within the prescribed periods, all the measures necessary to implement all the provisions of Council Directive 80/987/EEC of 20 October 1980.

Because the Commission was unsuccessful on one head of argument (regarding the requirement for equivalent protection for the persons listed in Section I A of the annex), which it abandoned only in the oral procedure, account may be taken of that when awarding costs, for example by requiring the defendant, which must otherwise bear the costs of the proceedings, to pay only three-quarters of the costs incurred by the Commission.