1. 

This case is the judicial epilogue to a dispute between the Commission and Mrs Teresita Pace in connection with the teaching done by Mrs Pace for the European Atomic Energy Community over a period of 17 years.

The applicant taught general studies and Italian as part of the vocational training courses at the Ispra Joint Research Centre from the beginning of the school year 1963/64 until the end of the school year 1979/80. For the first five years there was no written contract in respect of her teaching but subsequently, from 1969 to 1975, the Director of the Centre specified each year, in a letter to Mrs Pace, both the duration of her service, which corresponded to the full school year (namely from 15 September to 15 July), and the hourly pay which she would receive. Then as from the school year 1976/77, the relationship between the applicant and Ispra Centre was based on a more comprehensive document (drawn up in French and signed by both parties) which was defined, in paragraph 6, as a “service” contraa. Another clause provided that the contraa was to be governed by Iulian law. Nevertheless, Mrs Pace acknowledged that she had been informed that she was responsible for ensuring that she complied with the Iulian tax and social security rules, “the institution having no obligation in that respect, in view of the nature of the present contract”. Finally, by virtue of paragraph 8, the contracting parties, referring to Article 42 of the ECSC Treaty, Article 181 of the EEC Treaty and Article 153 of the EAEC Treaty, stated that the Court of Justice of the European Communities was to “have sole jurisdiction to settle all disputes concerning the validity, interpretation or implementation of this contract”.

On 16 July 1980 Mrs Pace sent to the Director of the Centre a letter in which, after pointing out that the contract of employment was governed by Iulian law, she requested that as from 1963 the contract should be regarded as an exclusive employment relationship for an indefinite period, conferring on her entitlement to pay during the months when the school was closed, to holidays or to an allowance in lieu thereof, to the payment of contributions for social security and sickness benefit and to the consequent pension.

On 12 September of the same year, the Director of the Centre replied to the effect that the temporary contracts entered into each year between the Centre and the applicant had given rise to a relationship which, as a result of the provisions of those contracts, did not fall within the category of “employment” but rather within the category of “independent work”. Subsequently, the applicant, in a memorandum of 2 october 1980 addressed to the President of the Commission of the European Communities, submitted a complaint pursuant to Article 90 (2) of the Staff Regulations of Officials of the European Communities against the refusal conuined in the abovementioned letter of 12 September. She received no reply and on 6 May 1981 brought an action for the annulment of the implied decision rejecting her abovementioned complaint.

In her conclusion, the applicant had claimed that, as a temporary and interim measure pursuant to Article 186 of the EEC Treaty (corresponding to Article 158 of the EAEC Treaty), the Commission should be ordered to pay the remuneration due to her for the school year then in course but in her reply she acknowledged that the requested payment had been made in the meantime. The applicant's principal claims remain: that the Commission be ordered to apply to her financial and legal conditions equivalent to those laid down in the collective labour agreement in force in Italy in the private teaching sector and also to grant her, upon retirement, the pension provided for employees of the Community. In her last head of claim, the applicant asks that the Commission be ordered to pay the costs of the proceedings.

2. 

It should in the first place be made clear that the Court's jurisdiction regarding Mrs Pace's application derives from the abovementioned arbitration clause conuined in each of the contracts entered into between the applicant and the defendant as from the school year 1976/77, in the light of Article 153 of the EAEC Treaty which empowers the Court “to give judgment pursuant to any arbitration clause contained in a contract concluded by or on behalf of the Community, whether that contract be governed by public or private law”. However, before bringing the matter before the Court, the applicant followed the procedure laid down in Article 90 (1) and (2) of the Staff Regulations of Officials.

In its defence, the Commission raised an objection of inadmissibility stating that the applicant had acted on the basis of Article 91 of the Staff Regulations, which relates only to officials and other servants of the Community, whilst the application, which is connected with a contractual relationship governed by private law, is totally unconnected with that provision.

In reply to that objection Mrs Pace stated that, having worked as an employee in the service of the Community, she was entitled to rely upon the Conditions of Employment of Other Servants, Article 46 of which renders Title VII of the Staff Regulations, which deals with appeals, applicable by analogy.

In the course of the procedure, it was also made clear that the applicant does not seek to be considered as a “servant” of the Community within the meaning of the Staff Regulations but only to obtain all the benefits to which she is entitled under Italian labour law by virtue of the fact that she has worked as an employee in the service of the Commission. Moreover, in order to rebut the objection of inadmissibility, it is sufficient to note that, even though the applicant may not be entitled to reply upon Article 91 of the Staff Regulations of Officials, she is nevertheless empowered, under the abovementioned arbitration clause, to bring before the Court any matter relating to the validity, interpretation or performance of the contract of employment with the Joint Research Centre. It is hardly necessary to add that mistaken reliance in an application on a provision of the Staff Regulations is insufficient to render inadmissible an action which the applicant is certainly entitled to bring.

The question might also be asked whether the fact that the clause conferring jurisdiction appears only in the contracts entered into as from 1977 prevents the Court from considering the nature of the relationship between the parties during the earlier period, from 1963 to 1977. The reply must be negative, since the dispute raises the question whether the employment relationship by virtue of which the applicant taught at the Joint Research Centre from 1963 to 1980. was continuous and therefore whether or not it constituted a single period.

There is no reason therefore to declare the application inadmissible.

3. 

The dispute centres on the classification of the employment relationship between the applicant and the Ispra Joint Research Centre. Referring to Italian legislation and case-law, the applicant maintains that the activity carried on by her for the Centre from 1963 to 1980 gave rise to an employment relationship of indefinite duration. Accordingly she is entitled to the treatment enjoyed by teachers in the private sector, which includes payment during the summer months when schools are closed, a cost-of-living allowance, periodical increases for seniority, a 13th monthly payment, a severance payment (retirement grant) upon retirement or the other financial and legal conditions, as provided for in the collective labour agreement of 11 September 1978 for teaching staff employed in schools managed by private individuals or organizations, or to all of those benefits.

There is no doubt (as the parties acknowledge) that Italian law is applicable and accordingly the question whether the relationship in question was an employment contract or a contract for independent work must first be resolved in accordance with that law. Under Italian labour law, the terminology used by the parties in the text of the contract cannot alter the nature of the relationship if that is a matter determined by law. As was in fact stated by the Corte di Cassazione in its judgment No 2730 of 24 April 1980, “for the classification of an employment relationship as one relating to independent work or to employment, regard must be had, not to the nomen iuris used by the parties, even if it is expressly stated in writing, but rather to the actual nature and real substance of that relationship, and also to the detailed arrangements for performance of the duties constituting the work to be done”. In its judgment No 3353 of 14 June 1979, the same court stated that, for the purpose of the abovementioned classification, “the court need not concern itself with the formal aspects but must concentrate its attention above all on the basic distinguishing criterion according to which in the case of independent work the subject-matter of the service provided is the opus, that is to say the result of the activity, whereas in the case of work as an employee the subject-matter of the service to be provided is represented by the work effort (operae) which the person providing the service places at the disposal of the principal, expending that effort under the supervision and in accordance with the directions of the principal”.

The defendant maintains that that case-law relates only to teaching in the private sector and may be accounted for by the need to protect the position of the weaker party in relations with employers who are mainly concerned with making a profit. The same criteria should not be applied in the case of a teaching institution administered by the Commission of the European Communities, because it pursues exclusively objectives of public utility and may not therefore be placed on the same footing as any private entrepreneur. In consequence, the defendant considers that it is more appropriate to refer to the administrative case-law relating to employment in the public sector.

That view does not, however, appear to be in conformity with the fact that the defendant itself described the employment relationship between it and the applicant as being of a private nature. Furthermore, it is not clear how the criteria for determining whether or not a worker's position with respect to a principal may be described as that of employee can be different depending on whether the principal is in the public or in the private sector.

In effect, the case-law provides precise criteria by which to distinguish, regardless of the terminology used by the parties, whether a work relationship is a contract of employment or a contract for independent work. The determinant factor in this regard is the position of the worker, as regards the discharge of his duties, in relation to the principal. In particular, where he works under supervision and in accordance with the directions of the principal, there is a clear tendency in the case-law to perceive the existence of an employment relationship.

In that regard, two decisions of the Italian Cone di Cassazione specifically relating to teaching may be cited, namely judgment No 1412 of 16 June 1967 and judgment No 653 of 26 March 1973. In the first it was held that “it is clear that there is an employment relationship, and no provision of work on an independent basis, where teaching activity was carried on for several successive years by a teacher at an educational institution and it is ascertained that the carrying on of that activity involved the fulfilment of obligations such as the implementation of programmes and observance of a predetermined timetable, which were subject to control and possibly to disciplinary measures”. In the second judgment, the initial premise is that “in an employment relationship the subject-matter of the service provided is the activity which the worker places at the disposal of the principal, for which he is paid and which he performs as a member forming part of the organization of the undertaking, under the supervision and in accordance with the instructions of the entrepreneur”; and the conclusion deduced therefrom is that “there is thus a presumption of work as an employee in the case of teachers of foreign languages who are engaged in teaching in a private school, whose duties are of a continuous nature and are carried out over a long period of time under the instructions of the principal of the school, and for which monthly remuneration is paid”.

In this case, paragraph 3 of the last contract entered into between the parties, dated 7 September 1979 — which also appears in the various contracts concluded since 1976 — provides that “the teacher shall exercise her skills and shall be responsible for organizing and providing her teaching in accordance with the educational objective to be attained, as indicated in the programme of vocational training courses”. In that respect, the applicant's position appears to be no different from the usual position of teachers, whether temporary or permanent, in public or private schools. Each teacher is in fact responsible for the teaching which he provides, whilst he is bound by the instructions of the school authorities regarding the programme to be implemented and the educational aims to be pursued. The degree of freedom enjoyed by each teacher regarding the teaching he provides does not conflict with the fact of his working as an employee, a fact which appears in particular from his obligation to submit to supervision regarding the proper implemention of the programmes imposed on him and the pursuit of predetermined educational objectives.

Paragraph 5 of the abovementioned contract of 7 September 1979 provided that “details regarding the actual organization of courses and in particular the starting and finishing dates of courses, timetables, holidays, etc. shall be determined by agreement between the teacher and the institution so as to take into account the operational requirements of the latter”. In a school where the curriculum is divided into various courses given by different teachers for each subject, it is normal for timetables for individual lessons to be determined as far as possible by agreement between the authority responsible for running the educational institution and the teachers. However, the starting and finishing dates of courses and also the holidays are usually predetermined and apply to everyone who works in the school. In this case, according to the defendant, even those matters were negotiable between the teacher and the school. We do not know what procedure was adopted in practice. Moreover, the very fact that the determination of those matters was to “take into account the operational requirements of the institution to which the school is attached” confirms in that respect also the fact that the teacher was in a subordinate position with regard to the other party to the contract.

It remains to be ascertained whether the contraa in question is to be regarded as being of a specific or of an indefinite duration.

It should be noted in that regard that under Italian Law No 230 of 18 April 1962, which governs employment contracts of a specific duration, an employment contract is in general deemed to be of indefinite duration, subject to a number of exceptions which are indicated in Article 1 of the law. That provisions states: “A time-limit for expiry of the contract may be imposed :

The employment contract at issue here may not be assigned to any of the cases mentioned above. The defendant emphasizes the fact that the applicant worked for a limited number of hours (from a minimum of 36 hours per month in the school year 1969/70 to a maximum of 63 hours per month in the school year 1979/80) whilst the applicant produces higher figures and challenges the method of calculation adopted by the defendant, which is based on a year of 12 months rather than on the shorter period of a school year. Moreover, the defendant contends that the work was merely intermittent and was carried out at times determined solely in accordance with the school's internal requirements (reasons of administration and organization of the courses). It is not, however, clear how work extending over the whole school year, following a specific weekly timetable and involving the application of part of the normal programme established for the first-level curriculum in the school can be described as intermittent.

Therefore, the defendant's argument, which seeks to bring the employment relationship at issue within the scope of Article 1 (c) of the abovementioned Law of 18 April 1962, must be rejected.

Teaching activity which has been carried on regularly and continuously for 17 years (apan from the usual interruptions due to school holidays, which apply to all teachers) cannot be regarded as work of an exceptional or occasional nature.

Similarly, the imposition of a limit on the duration of each contract entered into between the parties in question each year does not override the legal presumption, raised by the first paragraph of Article 1 of Law No 230/1962, that an employment relationship of indefinite duration exists.

That conclusion is borne out by Italian case-law both before and after the said Law of 18 April 1962. In particular, according to the case-law after 1962, “a teacher who is contracted for a period including that of the examinations and for several consecutive years is bound by a relationship of indefinite duration. Therefore, he is entitled to payment for the summer period and to a severance allowance” (Catania Appeal Court, 19 November 1970, cited by the applicant at pages 16 and 17). Even more significant is judgment No 4452 of the Corte di Cassazione of 12 July 1980 which stated: “Since Article 1 of Law No 230 of 18 April 1962 provides that the circumstances listed in the article on employment contracts of limited duration constitute true and effective exceptions, a contract of employment in the private sector entered into with a teacher at an educational institution, which does not fall within the circumstances provided for in that Law or within other legislative provisions, is ex lege to be regarded as of unlimited duration”.

5. 

Therefore, in my opinion, there exists substantial grounds for the view that the relationship between the defendant and applicant, which extended over 17 years, was a contractual one, of unlimited duration, between employer and employee.

It follows therefore that the applicant is entitled to the benefit of all the consequences attached by Italian law to that situation. The defendant, in order to resist the applicant's claim that the national collective labour agreement is applicable, maintained that the payments made to Mrs Pace were considerably greater than those provided for in that agreement, even if account was taken of the fact that she was not accorded the holidays, the 13th monthly payment or the other benefits provided for in the national agreement. Even if that were true, it would have to be borne in mind that the benefits provided for in the national labour agreements are minimum benefits — there is nothing to prevent the payment by employers of remuneration above those minimum levels. In any case, in so far as collective agreements confirm conditions laid down by law (such as entitlement to holidays and to the 13th monthly payment and the employer's obligation to make social security contributions), various conditions, which are of a mandatory nature, must be respected regardless of whether or not the collective agreement is applicable.

6. 

I have already referred to the second head of the applicant's conclusions relating to payment of the pension provided for Community staff and I have pointed out that the matter was subsequently clarified during the oral procedure, in other words the question whether or not the applicant might be regarded as an employee of the Commission is totally extraneous to these proceedings. That clarification should imply that the abovementioned claim is abandoned: there is in fact no basis for any claim to benefits specifically attached to the status of an official or servant of the Communities if the person claiming those benefits is not in a position to prove that status. In any case, in the event of that head of claim's being maintained, I am of the opinion that it should be dismissed; indeed, the fact that the relationship in question in subject to Italian law and is classified as an employment relationship of indefinite duration in the private teaching sector entails the consequence that the retirement pension must also be dealt with under the same law, and not under Community law which, as is dear from the file on the case, is inapplicable.

7. 

I consider that at this stage the Court should go no further. It is appropriate that the matter of precisely what favourable effects will accrue to the applicant as a result of the application of Italian law, after clarification of the nature of her employment relationship with the Commission, be referred in the first place to the parties. They should seek to reach an agreement in that respect, on the basis of the provisions in force in Italy concerning employment relationships, determining inter alia, whether the requirements are satisfied for the application, not only of the legal rules, but also of the provisions of the collective agreement referred to.

8. 

In conclusion, I suggest that the Court declare that the teaching activity carried on by Mrs Teresita Pace at the vocational training school at the Ispra Joint Research Centre implied the existence of an employment relationship of indefinite duration, as provided for by Italian law which is applicable by virtue of the reference thereto in the contract. The Court should also specify a period within which the parties are invited to agree as to the pecuniary consequences of that classification. In the absence of an agreement within that period, the Court should reserve the right to adjudicate upon the claim regarding the remuneration and pension payable to the applicant. The question of costs should in the meantime be reserved.