A Dutch national and resident in the Netherlands, was, on the basis of a ‘letter of employment’ (hereinafter “employment contract”) – drafted in English –, employed as Chief Financial Officer for an unlimited period by PSA Antwerp NV, a company established in Antwerp (Belgium) but part of an international group whose registered office is in Singapore. The employment contract stipulated that the work would be carried out in Belgium, although some work was carried out from the Netherlands as well.
A few years later, by letter – drafted in English –, the individual was dismissed with immediate effect. Pursuant to the provisions of the employment contract, the employer paid him an indemnity in lieu of notice equal to three months’ salary and an additional payment equal to six months’ salary. He did not agree to this indemnity in lieu of notice, since, according to him, the provisions of the contract are null in application of the Flemish Decree of 19 July 1973 (hereinafter “Decree”), and therefore claimed a higher indemnity in accordance with Belgian law.
Since the parties failed to reach an agreement on this matter, the case was brought before the labour tribunal of Antwerp.
The Decree provides that all employers, whose place of business is located in the Dutch-speaking region, i.e. Flanders, should draw up all acts and documents required by law and all documents intended for their staff in Dutch, on pain of nullity thereof.
In this case the employment contract was concluded between a Dutch-speaking employee and a non-Dutch-speaking employer – the employment contract was signed by a Singapore national who has no knowledge of Dutch.
In those circumstances, the labour tribunal of Antwerp had doubts as to whether any requirement arises from a ground of general interest that the employment contract be drafted in Dutch in a cross-border situation, in which the parties clearly chose to draft an employment contract in a language understood by both parties.
Therefore, the labour tribunal referred the following question to the European Court of Justice for a preliminary ruling: “Does the Decree infringe the freedom of movement for workers within the European Union, in that it imposes an obligation on an undertaking established in the Dutch-speaking region when hiring a worker in the context of employment relations with an international character, to draft all documents relating to the employment relationship in Dutch, on pain of nullity?”
The Court reiterates that national measures capable of hindering the exercise of the fundamental freedoms guaranteed by the Treaty or of making this less attractive may only be allowed on the condition that those measures pursue a legitimate objective in the public interest, are appropriate and do not go beyond what is necessary to attain the objective pursued.
In this respect, the Belgian government claims that there is a legitimate objective, which is three-fold, namely promoting and encouraging the use of one of its official languages, ensuring the protection of employees by enabling them to examine employment documents in their own language and enjoying the effective protection of the workers’ representative bodies and administrative and judicial bodies called upon to recognize those documents and ensuring the efficacy of the checks and supervision of the employment inspectorate.
The Court accepts that the aforementioned objectives constitute a legitimate interest capable of justifying such restrictions on the exercise of the freedom of movement for workers within the European Union.
However, the Court decides that the Decree goes beyond what is strictly necessary to attain said objectives, in particular the nullity of the employment contract. Therefore, the Decree cannot be regarded as proportionate, moreover since the parties to a cross-border employment contract do not necessarily have knowledge of the official language of the member state concerned. After all, the establishment of free and informed consent between the parties requires those parties to be able to draft their contract in a language they both understand, which may be another language than one of the official languages of that member state.
The Decree is only in violation with European law, insofar it applies to a cross-border employment situation. Accordingly, the employment contract, drafted in Bulgarian, concluded between a Belgian national, who resides and works in Flanders and who masters the Bulgarian language, and a Belgian company, whose place of business is located in Flanders, of which the members of the board of directors are all Bulgarian-speaking, is not in violation with European law, since there is no cross-border employment situation. Consequently, the Decree in principle fully applies entailing the nullity of said employment contract.
Furthermore, the Court rules that the Decree is disproportionate in relation to the objectives pursued, since an act or document required by law or intended for the staff in breach of said Decree is null. In this regard, the Court suggests that a legislation of a member state which would not only require the use of the official language of that member state for cross-border employment contracts, but which also, in addition, would permit the drafting of an authentic version of such contracts in a language known to all parties concerned, would be less prejudicial to the freedom of movement for workers than the Decree while being appropriate for securing the objectives pursued by that legislation.
Accordingly, the legislation of a member state can still require, even in cross-border employment situations, that the documents drafted in a language other than an official language would be translated in one of the official languages of that member state.
KPMG closely monitors the tendencies regarding international employment, in particular the legal and/or judicial consequences of the judgment.
1 Court of Justice of the European Union, C-202/11, Anton Las v. PSA Antwerp NV, 16 April 2013.