The Court of Justice has handed down a major judgment on the horizontal direct effect of directives. And on age discrimination, again.
The judgment of the Court in Case C-555/07 Seda Kücükdeveci is a difficult and subtle one and is sure to keep commentators busy for quite a while. Here's our take on it.
First the story. The young Ms Kücükdeveci was employed from the age of 18 by a private German company called Swedex. In 2006, ten years after she started work for them in 1996, Swedex dismissed her. Swedex calculated that she had accumulated only three years of length of service, not ten years. How come ? Because German legislation stated that the employer should not take account of periods of employment prior to the employee's 25th year of age in calculating the length of employment. Ms Kücükdeveci challenged her dismissal before the German labor courts claiming that the German legislation which disregarded employment before the age of 25 constituted illegal age discrimination and that she was not given the proper period of notice corresponding to her length service.
The German court referred two questions to the Court of Justice: Whether the German legislation constituted illegal age discrimination according to EU primary law and Directive 2000/78 and if so, whether the national court should disapply national law in a dispute between two private individuals.
As to the first question, the Court of Justice held that it is a general principle of EU law that all discrimination on grounds of age is prohibited and Directive 2000/78 "gives expression" to that general principle. The Court refers to Case C-144/04 Mangold in which it had held that held that that directive does not itself lay down the principle of equal treatment in the field of employment and occupation, which derives from various international instruments and from the constitutional traditions common to the member States, but has the sole purpose of laying down, in that field, a general framework for combating discrimination on various grounds including age.
Significantly, the Court also refers to the Charter of Fundamental Rights which now has legal force since the entry into force of the Lisbon Treaty. The Court held that Article 6(1) TEU provides that the Charter of Fundamental Rights of the European Union is to have the same legal value as the Treaties. Under Article 21(1) of the charter, ‘[a]ny discrimination based on … age … shall be prohibited’.
But, for those general principles to apply, the case at hand must fall within the scope of EU law. The Court held that it does because the discriminatory conduct complained of in this case was adopted on the basis of national legislation and occurred after the expiry of the deadline for implementation of Directive 2000/78 by the member States. Consequently, this case could be distinguished from Case C-427/06 Bartsch  ECR I-7245.(For our post on that case, see here).
Having held that the discrimination in question was prohibited by EU law as a matter of principle, the Court then answered the second question on the consequences of such a finding. It held that the national court must ensure that the principle of non-discrimination is complied with by disapplying any contrary provision of domestic law.
The Court recalled the general rule that a directive cannot of itself impose obligations on an individual and cannot therefore be relied on as such against an individual (Case 152/84 Marshall  ECR 723, paragraph 48; Case C‑91/92 Faccini Dori  ECR I‑3325, paragraph 20; and Joined Cases C-397/01 to C-403/01 Pfeiffer and Others,  ECR I-8835, paragraph 108).
That is not the end of it, however. The Court went on recalling the member States’ obligation arising from a directive to achieve the result envisaged by that directive and their duty to take all appropriate measures, whether general or particular, to ensure the fulfillment of that obligation are binding on all the authorities of the Member States including, for matters within their jurisdiction, the courts (Case 14/83 von Colson and Kamann  ECR 1891, paragraph 26; Case C‑106/89 Marleasing  ECR I‑4135, paragraph 8; Case C‑91/92 Faccini Dori, paragraph 26; Case C‑129/96 Inter-Environnement Wallonie  ECR I‑7411, paragraph 40; Joined Cases C-397/01 to C-403/01 Pfeiffer and Others, paragraph 110; and Joined Cases C‑378/07 to C‑380/07 Angelidaki and Others  ECR I‑0000, paragraph 106).
The Court held that, as a consequence, when it applies national law the national court must ensure, as far as possible, in the light of the wording and the purpose of the directive in question, that the result pursued by the directive is achieved and thereby comply with the third paragraph of Article 288 TFEU (von Colson and Kamann, paragraph 26; Marleasing, paragraph 8; Faccini Dori, paragraph 26; and Pfeiffer and Others, paragraph 113). The requirement for national law to be interpreted in conformity with EU law is inherent in the system of the Treaty, since it permits the national court, within the limits of its jurisdiction, to ensure the full effectiveness of EU law when it determines the dispute before it ( Pfeiffer and Others, paragraph 114).
Importantly, the Court stated that the German legislation in issue was perfectly clear and could not be interpreted in such a way as to comply with EU law.
Because Directive 2000/78 merely gives expression to, but does not lay down, the principle of non-discrimination on grounds of age as it is a general principle of EU law ( Mangold, paragraphs 74 to 76), the national court, hearing a dispute involving the principle of non-discrimination on grounds of age as given expression in Directive 2000/78, must provide, within the limits of its jurisdiction, the legal protection which individuals derive from EU law and to ensure the full effectiveness of that law, disapplying if need be any provision of national legislation contrary to that principle (see, to that effect, Mangold, paragraph 77).
That seems like a rather convoluted way of saying that even if a directive does not have horizontal direct effect, the national court should seek to achieve the same result as if it did have such an effect when the directive gives expression to a general principle of EU law.
Lastly, the Court looked at the question whether the national court must refer a preliminary question on the basis of Article 267 TFEU before disapplying national law contrary to EU law.
The Court held that the national court need not make such a reference. It stated that the need to ensure the full effectiveness of the principle of non-discrimination on grounds of age means that the national court, faced with a national provision falling within the scope of EU law which it considers to be incompatible with that principle, and which cannot be interpreted in conformity with that principle, must decline to apply that provision, without being either compelled to make or prevented from making a reference to the Court for a preliminary ruling before doing so.