Entitlement to Provision of Necessary Work Equipment

The rulings of the Federal Labour Court (Bundesarbeitsgericht - BAG) of 10^th November 2021 - 5 AZR 334/21 and 5 AZR 335/21 have now confirmed the fundamental obligation of employers to provide their employees with the work equipment that is essentially required for the agreed work to be performed and that is suitable for this purpose.

This obligation applies in any case to work equipment without which the contractually agreed activity cannot be performed. However, employers generally have some leeway in the selection of suitable work equipment.

This entitlement also exists if employees are in possession of the corresponding work equipment anyway.

However, according to the BAG, a deviating regulation would also be permissible in general terms and conditions if employees were to receive appropriate financial compensation for the use of their own property (e.g. their own bicycle or mobile phone).

The Facts

In the above decisions, the plaintiff is employed by the defendant as a bicycle deliveryman who delivers food and drinks ordered by customers in various restaurants. In order to obtain the schedules and addresses of the restaurants and customers necessary for his work, the plaintiff has to access an app to be installed on an internet-enabled mobile phone. The use of this app usually consumes up to 2 GB of data volume per month.

By means of general terms and conditions, the defendant obliged the plaintiff to use his own bicycle and his own smartphone for the performance of the agreed work as a bicycle deliveryman. In return for the use of his own bicycle, the defendant grants a repair flat rate of 0.25 euros per hour worked. This can only be redeemed at a company to be determined by the defendant. The GTC do not provide for compensation for the use of the employee's own mobile phone.

The Decision

With the above-mentioned decisions, the BAG once again clarified that the claim to the provision of essential work equipment arises from section 611a (1) BGB in conjunction with the employment contract. In fact, the entitlement refers to the work equipment without which the contractually agreed work cannot be performed.

In the above-mentioned decisions, the BAG clarified that the almost complete passing on of acquisition and operating costs to employees, who also bear the sole risk for loss, wear and tear, depreciation and damage to the work equipment they brought in, is an unreasonable disadvantage, which is therefore invalid pursuant to section 307 (2) no. 1 in conjunction with section 307(1) sentence 1 BGB. A provision with such content contradicts the basic idea of the employment relationship, according to which the employer must provide the work equipment directly required for the performance of the contractually owed work. For the clause to be valid there had to be adequate compensation for the use of the plaintiff's property.

In the opinion of the BAG, the lump-sum repair allowance of 0.25 euros per hour worked did not constitute adequate compensation. On the one hand, the plaintiff could not freely dispose of the money. On the other hand, the lump sum for repairs is not based on the actual mileage directly responsible for the wear and tear, but on the working time only indirectly responsible for the wear and tear. Furthermore, there was no compensation for the use of the items provided.

The defendant employer's argument that the contracting parties typically involved (employees), such as the plaintiff in this case, were in any case in possession of an internet-capable mobile phone and a bicycle, was not relevant for the assessment of the clause, as the private objects are subject to greater wear and tear and a risk of damage and loss in the context of the use owed under the employment contract.

The Practice

Since the basic assumption taken up by the BAG in the above-mentioned decisions forms the basis of every employment contract, such an entitlement exists across all sectors.

Despite the decisions of the BAG, there is still potential for legal disputes. This is because in the above-mentioned decisions, the BAG does not comment on the question of when work equipment is "necessary", nor on the question of when a compensation regulation for the use of work equipment owned by the employee is appropriate.

Possible criteria for the appropriateness of a compensation provision are the amount of the compensation payment in relation to the value of the work equipment brought in and the specific nature of the work owed. In the absence of a statement by the BAG, however, there is usually only the extremely vague possibility of orientation on the limits of a review of the content under the law of general terms and conditions. Since according to section 310 (4) sentence 1 BGB the provisions of the GTC control are not applied to works agreements and collective agreements, it is advisable, where the internal organisational structure allows it, to conclude a collective-law provision with regard to the compensation of the property used by employees for the provision of services.

Following the BAG's decision, it is clear that employers will have to bear additional financial expenses in the future. Employers must either purchase the necessary work equipment and make it available to employees or provide appropriate compensation.

It remains to be seen whether this additional financial burden will be passed on to consumers.