OPINION OF MR ADVOCATE-GENERAL GAND

DELIVERED ON 10 JULY 1969 (*1)

Mr President,

Members of the Court,

The Bundesarbeitsgericht (Federal Labour Court), the appeal court in matters of labour law, is asking you to rule on the scope of Article 9(1) of Regulation No 38/64 of the Council of 25 March 1964 and Article 7 of Regulation No 1612/68 of 15 October 1968 on freedom of movement for workers within the Community. Must these Articles be interpreted to mean that a worker who is a national of a Member State and who is employed in the territory of another Member State is entitled, in accordance with the legislation of the country of employment, to have the period of his military service in his country of origin taken into account in the calculation of his seniority with his employer, where he has interrupted his employment in order to fulfil his obligations for military service?

The action which led the German high court to submit this question to you arose in the following circumstances. Mr Ugliola, an Italian national, has worked since May 1961 as a dairy employee with the Württembergische Müchverwertung-Südmilch, an undertaking situated in the German Federal Republic. He interrupted his employment from 6 May 1965 to 14 August 1966 in order to do his military service in Italy, and then immediately returned to his job with his former employer.

The question then arose of the application in his favour of the German law which guarantees employment when an employee is called up for military service. Under this law, which has been in force since 31 March 1957, the contract of employment shall be suspended during the period in which the worker is required to do his basic military service or is recalled for a period of reserve training. Article 6(1) provides that a worker who subsequently resumes his employment in the undertaking shall not have his occupational prospects or his position with his employer prejudiced by reason of any absence connected with obligations for his military service. Under Article 6(2), the period of basic military service or a period of recall for training is to be taken into account in calculating the duration of his occupation or of his service with his employer. If this rule is extended to the period of his military service in Italy, Mr Ugliola was entitled, as from Christmas 1966, to increased benefits under the legal provisions applicable to the undertaking by which he is employed. He considers that by virtue of the Council's regulations he is entitled to the benefit of Article 6(2) of the law on security of employment.

Such is not the opinion of his employers who maintain that the performance of his obligations for military service and the compensation to which this may entitle him are questions governed by public law and not by labour law. The relevant national provisions cannot therefore be considered to form part of the conditions of employment and work; these are subject to the provisions of Community law which provide that the nationals of one Member State must not be subject to different treatment in another Member State.

Although the court of first instance upheld Mr Ugliola's claim, it did so on the basis of German law alone and on an interpretation of the contract between the employer and the employee, without referring to Community law; it was, on the other hand, on the basis of Community law that the appeal court upheld the claim by this worker. The Bundesarbeitsgericht, with which the undertaking lodged an appeal, is asking you to interpret Article 9(1) of Regulation No 38/64 and Article 7 of Regulation No 1612/68.

II

The Regulations in question are based on Article 48 of the Treaty which provides that freedom of movement for workers shall be secured within the Community by the end of the transitional period at the latest and specifies that such freedom of movement shall entail the abolition of any discrimination based on nationality between workers of the Member States as regards employment, remuneration and other conditions of work and employment.

When you were called upon to interpret Regulation No 3 on the social security of migrant workers you considered that as Articles 48 to 51 of the Treaty provided for the establishment of the greatest possible freedom of movement for workers, the measures taken in implementation thereof must be seen as intended to prevent the legal position of migrant workers from being prejudiced. (Nonnenmacher, 9 June 1964, Case 92/63 [1964] E.C.R. 281). It is in this light that the provisions in question must be examined.

Although the provisions relating to the eligibility for employment of the nationals of the Member States have become more liberal as the Council has adopted new Regulations, the principle of equality of treatment for an existing contract of employment was established from the outset. It was already expressed in Regulation No 15/61 of the Council; it was enunciated again by Article 9 of Regulation No 38/64 in the following terms:

‘A worker who is a national of a Member State may not, in the territory of another Member State, be treated differently from national workers by reason of his nationality. He shall enjoy the same protection and receive the same treatment as the national workers in respect of any conditions of employment and work, in particular as regards remuneration and dismissal.’

Finally, this principle was set out again, albeit in a slightly different form, in Article 7 of Regulation No 1612/68 which, without containing any positive statement guaranteeing to workers from other Member States the same protection and the same treatment as that received by nationals, includes a prohibition against discrimination, which in fact produces the same result. Thus, the texts prescribe assimilation ‘in respect of any conditions of employment and work’, and this phrase must be interpreted widely. First, although they expressly refer only to certain aspects of these conditions, such as remuneration and dismissal, this list is preceded by the words ‘in particular’. Secondly, a worker is only entitled to take periods of military service into account in the calculation of the period of service with the employer in order to obtain a material advantage, and it may therefore be linked to remuneration. Finally, the Commission points out, with reason, that various provisions of Regulation No 38/64 and of Directive No 68/360, taken in conjunction with Regulation No 1612/68, were intended to prevent periods of interruption of residence due to the performance of military service from resulting in the loss of eligibility for employment or affecting the validity of the migrant worker's residence permit. The general purpose of these provisions is therefore to give the periods of military service in the country of origin their full effect, negative and positive as the case may be, in relation to the contract of employment.

III

To the arguments which may be relied on to give a positive reply to the question submitted by the Bundesarbeitsgericht, the Government of the German Federal Republic and the defendant undertaking contend, primarily, that the law whereof the benefit is claimed is part of the body not of labour law, but of military law and that it cannot, therefore, be affected by Regulations Nos 38/64 and 1612/68 and does not even fall within the ambit of the Treaty. On this point the German Federal Republic cites Article 223(l)(b) of the Treaty which empowers the Member States, in the interests of their security, to adopt regulations for the production of or trade in arms which depart from the Treaty, as well as to Article 224, which, in the case of a serious crisis, enables Member States to take any necessary measures without being bound to observe the rules of the Treaty. The Federal Republic concludes from this that it is free to pass all its own defence legislation, the law whereof the benefit is claimed being part of such legislation.

It will immediately be observed that the two Articles of the Treaty referred to have nothing to do with the text in question. This is entitled: ‘Law guaranteeing security of employment on call-up for military service’ and it is intended to govern the legal consequences, for a contract of employment, of the absence of a worker as a result of his obligations for military service. Provisions such as those, the benefit of which Mr Ugliola is claiming in the German court, are clearly associated with the problems of national defence, but they nevertheless form part of the ‘conditions of employment and work’ within the meaning of Article 9 of Regulation No 38/64 and Article 7 of Regulation No 1612/68.

However, this consideration only applies within the limits of the question submitted. Although you are required neither to interpret nor to consider the German law, it must be observed that it includes measures of a widely differing nature, some of which are connected with the problems of defence, while others concern questions of employment; some, finally, concern those in public services, and are, therefore, effectively outside the scope of the regulations in question. It is not a question of placing all the provisions of the Arbeitsplatzschutzgesetz within the scope of these regulations and one may certainly have doubts about some of the measures involved therein — doubts which are all the more serious as the criterion suggested yesterday by the Commission, whereby these measures are the responsibility of the State or undertakings concerned, seems to me to be questionable. However, so far as the inclusion of a period of military service in the calculation of seniority is concerned, this in my opinion clearly forms part of the conditions of work and employment.

Thus, as the Commission rightly points out, a Member State is free to legislate as it pleases to cope with the effects of military service on employment; it may even refrain from legislating at all. However, any legislation which it does adopt in favour of its own nationals must apply to periods of military service in the country of origin by the nationals of other Member States who are employed in its territory.

Moreover, it must not be thought that this problem is peculiar to the Federal Republic of Germany. Provisions guaranteeing to a greater or lesser extent security of employment in the case of call-up for military service exist in all the Member States. The benefit of such regulations may be claimed by a foreign worker on the same grounds as by a national. The charge imposed by the German legislation on the State in favour of foreign workers thus finds its counterpart in the advantage which its own nationals working in other Member States may obtain under the legislation of those States.

The Government of the Federal Republic of Germany then adds that even if the Community regulations were to be held to apply to the law on security of employment, or at least to the provision whereof the benefit is claimed by Mr Ugliola, this would in no way offend against the prohibition on discrimination as laid down in the regulations. This prohibition, which corresponds to that laid down in Article 48 of the Treaty, provides that the nationals of one Member State must be treated in another Member State in the same way as the nationals of the latter State. The German law respects this principle in that it also benefits foreigners to the extent that they do their military service in the Bundeswehr, but it does not benefit German nationals who do military service abroad in the army of another Member State. The criterion used is thus not based on nationality, but on service in the Bundeswehr; it is objective and justified as this law forms part of the defence legislation (but in saying this, the Government of the Federal Republic of Germany withdraws the admission which it made earlier for the purposes of the argument).

Moreover, in the absence of integration within the Community in the field of defence, differing national regulations are possible and justifiable; the inequality of treatment results from differences of circumstance in a sphere in which there is no integration.

At first sight, this argument may appear attractive, but I do not find it convincing. The performance of military service in the army of the State other than that of which one is a national is a hypothesis which even the Government of the Federal Republic of Germany considers to be somewhat theoretical. The discrimination is, perhaps, not based expressly on nationality, but on the call-up for service, which is itself based on nationality. In fact, the provision in question only benefits German citizens and although this is quite justifiable within the sphere of German legislation, the very purpose of the regulation on freedom of movement is precisely to abolish such privileges.

As regards the inequality of treatment which results from the fact that we are dealing with a sphere in which there is no integration, this is normal within the strict limits of the sphere of national defence, but it is no longer normal where, as in the case which gave rise to the reference to you, the provision in question forms part of the conditions of employment and work covered by Regulations Nos 38/64 and 1612/68.

There remains one final objection based on Article 48 of the Treaty, which allows discrimination to be made on the grounds of public security.

Here, it is necessary to refer to the text. Paragraph (3) of this Article provides that freedom of movement for workers shall entail the right, subject to limitations justified on grounds of public policy, public security or public health: to accept offers of employment actually made — to move freely for this purpose — to stay in a Member State for the purpose of employment in accordance with the provisions governing the employment of nationals of that State — to remain on certain conditions in the territory of a Member State after having been employed in that State.

It is clear that all these situations deal with the search for employment and the right to carry on a trade or profession. On grounds of public policy or public security a foreigner may not be permitted to enter a country and take up employment there, but these considerations have no bearing on conditions of work once employment has been taken up in an authorized manner. In the field of remuneration, for example, no reason based on public policy or public security may cause a foreign worker to be treated differently from a national. This is a sphere in which the ‘discrimination’ allowed by Article 48(3) cannot operate. In concluding his oral observations the Agent of the Commission stated that the case referred to you was a borderline one and rather doubtful at that.

I consider that the question submitted by the Bundesarbeitsgericht must be answered as follows:

the national legislative provisions which provide for the inclusion of periods of military service in determining the seniority of a worker in an undertaking must be deemed to form part of the conditions of employment and work, within the meaning of Article 9 of Regulation No 38/64 and Article 7 of Regulation No 1612/68;

—the principle of equality of treatment set out in these Articles implies that the periods which a worker spends in his country of origin in order to fulfil his obligations for military service must be taken into account in determining his seniority in an undertaking in another Member State, in the same way as periods of military service completed in the armed forces of the latter State.

(1) Translated from the French.