The CJEU declines employer’s right to require a period of work after an unpaid leave and before a new maternity leave as a condition for maternity leave remuneration

In its recent ruling, the CJEU found incompatible with EU legislation a Finnish collective agreement provision, according to which a pregnant employee who interrupts a period of unpaid parental leave to take a maternity leave does not benefit from the maintenance of the remuneration to which she would have been entitled had that period of maternity leave been preceded by a period of resumption of work. The judgment was made in spite of contrary opinions of Advocate General and several Member States.

The European Court of Justice gave its ruling on 13 February 2014 in joined cases C-512/11 and C-513/11. The reference for a preliminary ruling concerned EU legislation and national collective agreement provisions on an employer’s right to set a period of work between a maternity leave and an unpaid parental leave as a prerequisite for the payment of remuneration.

According to the Finnish collective agreement and its application in practice, employees are entitled to maternity leave remuneration higher than the minimum compensation standard set by national legislation. A precondition to receipt this benefit paid by the employer is that the period of maternity leave does not begin during a period of unpaid leave. Several Member States and the Advocate General submitted opinions in support of the employer’s aim of encouraging employees to return to work between periods of maternity and unpaid parental leave. In spite of this, the CJEU stated that the collective agreement condition at issue was incompatible with EU legislation because the condition undermined the Union legislation’s effectiveness.

It is an established interpretation that, notwithstanding the requirement that employees on maternity leave be afforded special protection, the situation of such employees is not comparable to the situation of employees actually on duty at work or, alternatively, on sick leave. In spite of this, and as a consequence of the recent CJEU judgment, it now seems that applying a collective agreement provision that requires an employee to move directly from work or paid leave to a maternity leave in order to receive remuneration during a maternity leave period is no longer allowed in the EU. The judgment may have substantial economic consequences on employers and could affect future collective bargaining.

According to Advocate General Juliane Kokott, the situation of an employee taking maternity leave directly after or during an unpaid parental leave is not comparable to the situation of an employee taking maternity leave after actively practicing a profession.

Reconciliation of work and family life is an important theme in and interest of EU and national policy. It also affects collective bargaining. Reconciliation includes acknowledging both the needs of employees and undertakings.

By applying the collective agreement term described above, an undertaking can have a legitimate aim of, firstly, encouraging employees to return to work for an undetermined period of time before taking a new maternity leave and, secondly, avoiding situations in which an employee is, without interruption, off duties for several years. The ruling hampers employers’ ability to create incentives that encourage employees to resume to work between maternity leaves.