• The case of Case C-684/16 Max Planck Gesellschaft v Shimizu concerned employment law, it established that mandatory and unconditionally natured provisions of the Charter can be applied horizontally.

Facts of Case C-684/16 Max Planck Gesellschaft v Shimizu

  • Shimizu was employed by Max-Planck and was told to take his leave before the employment relationship terminated – he took two days’ leave
  • After unsuccessfully seeking payment from Max-Planck for the 51 days’ paid annual leave, Shimizu brought an action seeking the employer be ordered to pay
  • Max-Planck appealed the action being upheld
  • The referring court, Federal Labour Court of Germany, believed that EU case law does not make it possible to determine whether national law is consistent with Article 7 of Council Directive 2003/88, nor Article 31(2) of the Charter
  • The Labour Court were also unsure as to whether the Directive and Charter has direct effect in respect of conflict between individuals – they believed as the company as the company was a non-profit organisation without special powers it would be treated as an individual

Issues in Case C-684/16 Max Planck Gesellschaft v Shimizu

  • Did the national law preclude the right to annual paid leave under Article 31(2)?
  • And did this Article have horizontal direct effect?

Held by the European Court of Justice

  • Article 31(2) not only precludes national measures, but is also applicable by horizontal direct effect.

Findings of the Court

The European Court of Justice established that Article 31(2) precludes national legislation:

  • “it should be recalled that it is settled case-law of the Court that the fundamental rights guaranteed in the legal order of the European Union are applicable in all situations governed by EU law” [49]
  • The provision “enshrines the ‘right’ of all workers to an ‘annual period of paid leave’” [51]

Applying this to the present case, the CJEU held “Member States may not derogate from the principle flowing from Article 7 of Directive 2003/88 read in the light of Article 31(2) of the Charter, that the right to paid annual leave acquired cannot be lost at the end of the leave year and/or of a carry-over period fixed by national law, when the worker has been unable to take his leave” [54]

Horizontal direct effect of the Charter must be applied, this will “ensure within its jurisdiction the judicial protection for individuals flowing from that provision and to guarantee the full effectiveness thereof by disapplying if need be that national legislation” [80]