JUDGMENT OF 28. 2. 1980 — CASE 67/79 FELLINGER v BUNDESANSTALT FÜR ARBEIT

In Case 67/79

THE COURT (First Chamber) composed of: A. O'Keeffe, President of Chamber, G. Bosco and T. Koopmans, Judges, Advocate General: H. Mayras Registrar: A. Van Houtte

gives the following

JUDGMENT

Facts and Issues

I — Facts and written procedure

II — Written observations submitted in accordance with Article 20 of the Protocol on the Statute of the Court of Justice of the EEC

III — Oral procedure

Decision

Costs

I —. Facts and written procedure

1. Waldemar Feliinger, a German national, a plasterer by trade, was employed in the Federal Republic of Germany until 10 October 1974 at a gross wage which amounted to DM 3872 in the last month of his employment (1 to 30 September 1974). From 11 October 1974 until 10 November 1974 Mr Fellinger was unemployed and received unemployment benefit calculated on the basis of a standard wage of DM 815 from the Employment Office, Saarlouis.

2. Proceedings contesting that decision before the Sozialgericht [Social Court] for the Saarland were dismissed by judgment of 17 February 1977. Mr Fellinger appealed to the Landessozialgericht [Regional Social Court] which, by judgment of 26 October 1977, reversed the judgment of the Sozialgericht and ordered the social security authorities to calculate the disputed unemployment benefit as from 21 November 1975 on the basis of the claimant's last employment in the Federal Republic of Germany.

3. The order making the reference to the Court was received at the Court Registry on 25 April 1979.

II —. Written observations submitted in accordance with Article 20 of the Protocol on the Statute of the Court of Justice of the EEC

III —. Oral procedure

1. By an order of 15 February 1979, which was received at the Court on 25 April 1979, the Bundessozialgericht put certain questions to the Court of Justice for a preliminary ruling under Article 177 of the EEC Treaty on the interpretation of Regulation No 1408/71 of the Council of 14 June 1971 on the application of social security schemes to employed persons and their families moving within the Community (Official Journal, English Special Edition, 1971 (II) p. 416) and, in particular, the provisions of Article 68 of that regulation.

2. Those questions have arisen in the context of a dispute between an employed person of German nationality and resident in the Federal Republic of Germany and the Federal Labour Office (Bundesanstalt für Arbeit), Nuremberg, relating to the classification of unemployment benefit due to that person by the Employment Office (Arbeitsamt), Saarlouis. It appears from the order making the reference to the Court that the worker in question worked in the Federal Republic of Germany until 10 October 1974 after which date he was unemployed and received from the Employment Office, Saarlouis, unemployment benefit calculated on the basis of the wage paid in his last employment in the Federal Republic of Germany. Having thereafter worked, with the status of a frontier worker, in the Grand Duchy of Luxembourg and having become twice unemployed he was awarded by the abovementioned employment office unemployment benefit calculated on the basis of the wage which he would have received in the Federal Republic of Germany in an employment equivalent to that which he last had in Luxembourg. The claimant disputes the calculation applied by the German employment office to those unemployment benefits and contends that benefits ought to be paid to him on the basis of the wage received in his last employment in the Federal Republic whereas the employment office considers that the said calculation is in accordance with Article 68 (1) of Regulation No 1408/71.

3. With a view to deciding the dispute on this matter, the national court has referred the following questions to the Court for a preliminary ruling:

4. Since these questions are closely related it is convenient to consider them together.

5. It appears from the order making the reference to the Court that these questions have been put in regard to a frontier worker, that is to say, a worker who, in accordance with the definition given to that term by Article 1 (b) of Regulation No 1408/71, is employed in the territory of a Member State and residing in the territory of another Member State and for whom the competent institution for the provision of unemployment benefit is, by virtue of Article 71 (1) (a) (ii) of that regulation, that of the Member State in the territory of which the worker resides. It is therefore with regard to the special position of such a worker that there fall to be interpreted in this case the provisions of Article 68 (1) of the said regulation which reads:

6. These provisions occur amongst the common provisions of Chapter 6 of Title III of the regulation, relating to unemployment, and are of general application and do not relate to particular situations peculiar to certain categories of worker. They clearly refer to the ordinary case of the worker who is normally employed in the territory of the competent State in which he is residing or staying and they provide, in the second sentence, the special rule there laid down only for the exceptional case in which that worker has been in his last employment in the territory of the said State for less than four weeks. In the form in which they are drawn up these provisions do not therefore allow of a definition of the criteria of calculation applicable to unemployment benefit due to a frontier worker who, since he resides in a Member State different from that in which he is employed, can never, by very reason of his status as a frontier worker, be employed in the territory of the State which provides his unemployment benefit. The application of the said provisions to such a worker would produce the result that, since by definition he is in the position contemplated by the second sentence of Article 68 (1), the rules which that provision lays down by way of an exception would normally be applied to him and he would never be able to receive unemployment benefit based on the wage or salary actually received in his last employment. Such treatment in regard to unemployment benefit would place him in an unfavourable situation compared with workers in general, for whom the State of employment where they reside or stay is normally the competent State and would, moreover, conflict with the requirements of the free movement of workers. Since daily movements often take place from countries with low wages to countries with higher wages the fact that unemployment benefit paid to frontier workers could never be calculated on the basis of the higher wages would in fact be such as to discourage those movements and thus the mobility of workers within the Community.

7. In these circumstances, the system of rules applicable to frontier workers where the legislation of the competent Member State provides that unemployment benefit is to be calculated on the basis of the previous wage or salary must be elicited from Article 68 (1) of Regulation No 1408/71 in the light of the general principle underlying both that provision and the regulation as a whole. In that regard, it is appropriate to emphasize, first, that, as appears from the ninth recital in the preamble thereto, Regulation No 1408/71 in order to secure mobility of labour under improved conditions, seeks to ensure the worker without employment of the unemployment benefit provided for by the legislation of the Member State to which he was last subject. Such an objective clearly implies that in Regulation No 1408/71 unemployment benefit is regarded in such a manner as not to impede the mobility of workers, including frontier workers, and to that end seeks to ensure that the persons concerned receive, benefits which take account so far as possible of the conditions of employment, and in particular of the remuneration, which they enjoyed under the legislation of the Member State of last employment. Moreover it appears from the first sentence of Article 68 (1) that, apart from the special case contemplated in the second sentence, the previous wage or salary which normally constitutes the basis of calculation of unemployment benefit, is, according to that regulation, the wage or salary received in the last employment of the worker and that it is only by way of exception and derogation that the basis of calculation of those benefits may in certain cases be the notional and not the actual wage or salary in the last employment.

8. Having regard to all these factors, it follows that Article 68 (1) of Regulation No 1408/71 is founded on the general principle that the previous wage or salary to be used in calculating unemployment benefit is normally the wage or salary actually received by the worker in the last employment held by him immediately before his becoming unemployed. Such a principle accords not only with the demands of free movement of workers laid down in Article 51 of the Treaty but also with the requirement underlying Regulation No 1408/71 of granting workers unemployment benefit proportional to the conditions of remuneration which they enjoyed at the time of their becoming unemployed.

9. For these reasons, the appropriate answer to the questions put is that Article 68 (1) of Regulation No 1408/71, viewed in the light of Article 51 of the Treaty and the objectives which it pursues, must be interpreted as meaning that, in the case of a frontier worker, within the meaning of Article 1 (b) of that regulation, who is wholly unemployed, the competent institution of the Member State of residence, whose national legislation provides that the calculation of benefits should be based on the amount of the previous wage or salary, shall calculate those benefits taking into account the wage or salary received by the worker in the last employment held by him in the Member State in which he was engaged immediately prior to his becoming unemployed.

On those grounds, THE COURT (First Chamber), in answer to the questions referred to it by the Bundessozialgericht by order of 15 February 1979, hereby rules: