The Egenberger decision by the German Federal Constitutional Court (FCC) is not only about church labour law, but touches on fundamental issues of national and European constitutional law. Through its balanced, conciliatory and nuanced decision, the FCC’s Second Senate prevented unnecessary conflict with the Court of Justice of the European Union (CJEU). Taking into account both the standards of EU law as a framework and the specific requirements of German fundamental rights, the FCC adjusted judicial review with regard to conflicts between the right to religious self-determination and non-discrimination at the workplace. By integrating the requirements of EU law while maintaining domestic specificities, the decision provides a valuable example of how to manage different layers of fundamental rights. Nevertheless, the Egenberger decision carries an element of surprise. The FCC performed a Solange test in the reasoning on the merits of the case, elaborating on the question of whether the relevant European standard falls short of the minimum standard required under German law and therefore justifies an exception to the primacy of EU law. This raises the question of the conditions under which the Solange reservation, which was thought to have become more or less hypothetical, could be invoked in future cases.

Granting the constitutional complaint without coming into direct conflict with the CJEU

The long-awaited Egenberger decision had the potential to spark renewed conflict between the FCC and the CJEU, for the complainants requested nothing less than for the FCC to disregard the Egenberger judgement of the CJEU of 2018, arguing that it constituted an ultra vires act and violated German constitutional identity. A particular merit of the Egenberger decision is that the FCC essentially defused the constitutional complaint which was framed in terms of the ultimate and conceptually overstretched constitutional boundaries vis-à-vis European integration and downsized it to the core issue: determining and enforcing the proper standard for constitutional review by coordinating multiple layers of fundamental rights at the national and European levels.

This allowed the FCC to even declare the constitutional complaint, which was formally directed against a prior judgment of the German Federal Labour Court (FLC), to be partially admissible and well-founded without provoking an open conflict with the CJEU. The FCC held that the FLC had misconceived the margin of discretion (or leeway) that the relevant EU law on anti-discrimination, as interpreted by the CJEU, leaves to Member States when implementing it and that the FLC had, as a result, not given the “constitutionally required effect to the complainant’s right to religious self-determination” when carrying out the balancing of interests (para 143).

Applying national fundamental rights within the framework of EU non-discrimination law

The central theme of the decision is undoubtedly the emphasis on the diversity of national fundamental rights in an area where EU law does not effect full harmonisation, i.e. where Member States enjoy a certain margin of discretion in implementing EU law. In this respect, the Egenberger decision builds on the Right to be forgotten case law, which differentiates between two scenarios: In the first scenario, EU fundamental rights can directly be invoked as a standard of review in constitutional complaints before the FCC insofar as EU (secondary) law fully determines the case at hand (Right to be forgotten II). In the second scenario the FCC continues to apply “primarily” German fundamental rights as far as EU law does not effect full harmonisation and the primary application of German national standards does neither undermine the level of protection under the EU Charter nor specific fundamental rights requirements as set out by EU secondary law (Right to be forgotten I). The decisive test for determining the relevant scenario and the applicable standard of review (European or national) before the FCC is therefore the degree of harmonisation of the relevant EU law (test of discretion).

In this regard the Egenberger decision convincingly classified the relevant Equality Framework Directive, including its Article 4(2), as a normative framework that leaves discretion to the Member States when implementing it (paras 155 et seq). Against this backdrop, the FCC primarily relied on German fundamental rights, which were considered to offer a level of protection not inferior to that afforded by the EU Charter. However, the question remains as to whether the fact that the specific prohibition of discrimination under Article 3(3) of the Basic Law has no direct horizontal effect, whereas the principle of non-discrimination under Article 21 of the EU Charter can have such an effect, really makes no difference in terms of the level of protection, as claimed by the FCC (para 175).

Translating European requirements into the domestic standard of review

At the same time, however, the FCC rightly emphasised that the discretion granted to Member States when implementing the Directive is also limited by the latter, a point which is central to the case. In particular, the conditions set out in Article 4(2) of the Directive have a limiting effect on Member States’ discretion (paras 165, 209 and 211 et seq). The Directive aims to strike a balance between the right to religious self-determination and the protection of employees against discrimination, while leaving a certain, but not unlimited, room for manoeuvre at national level in weighing and balancing the conflicting legal interests (para 166). The FCC translated this European framework requirements into its standard of fundamental rights review by interpreting national constitutional law in consistence with EU law (para 210). Regarding the question of whether the limitation of the right to religious self-determination is justified, the FCC adhered, in principle, to its two-stage test for balancing conflicting legal interests in church labour law (paras 203 et seq), but adjusted this test in accordance with the requirements of EU law (paras 209 et seq).

This act of translating European requirements into the domestic standard of review led to visible modifications at both stages of the test. At the first stage, according to the FCC’s established case law, the churches’ assertions as to which matters are to be regarded as religious and what significance they have according to the churches’ self-perception were subject only to a plausibility check. In principle, the state could neither examine nor judge the religious ethos itself. However, by taking into account EU law, the FCC reshaped this part of the test: In order to satisfy the requirements of the Directive, the courts under review must now determine in each individual case whether the nature of the occupational activity or the circumstances in which it is carried out “objectively give rise to a direct link” between the required church membership and the activity in question (para 217).

At the second stage, established FCC case law had required an overall balancing of the conflicting legal interests, which is subject to full judicial review and in which the principle of proportionality is of fundamental importance (para 221). Again, taking into account the requirements under the Directive, the FCC reshaped its traditional approach. In this context it is certainly questionable whether the criteria set out in Article 4(2) of the Directive can be assigned to the doctrinal topoi of suitability, necessity and appropriateness as seamlessly as the FCC would have us believe (para. 224). All in all, however, the FCC succeeded in translating the requirements of EU law, including the demand for a full judicial review of the balancing, into German constitutional law and thereby enforcing them through constitutional review.

Limiting access to identity and ultra vires review for legal entities

Of the three strands of the defensive triad developed by the FCC in recent decades to serve as a constitutional shield against potential excesses of EU law – Solange reservation, ultra vires review, identity review – the Diakonie had invoked two: Ultra vires review and identity review. The ultra vires claim was raised both “incidentally” – as part of the claim that the right to religious self-determination had been violated – and “principally” under the so-called right to democracy, which, according to the FCC’s settled case law, is supposed to protect the inalienable core of the principle of democracy and can be invoked within the framework of a de facto actio popularis. Moreover, the Diakonie argued that the inalienable core of the German Basic Law, its identity, had been violated.

With regard to legal entities, the Egenberger decision provides a relevant clarification: Legal entities cannot invoke either the right to vote, which forms the basis of the right to democracy, or human dignity, which forms part of the inalienable core of the German Basic Law. For this reason, the FCC’s Second Senate convincingly rejected both the admissibility of the principal ultra vires claim and the identity claim. As a private-law association, the Diakonie was not entitled to rely on either the right to vote or human dignity. Consequently, the constitutional complaint was only declared admissible with regard to the incidental ultra vires claim, i.e. the argument that the FLC had violated the Diakonie’s right to religious self-determination by closely following the approach of the CJEU’s Egenberger judgment, which allegedly constituted an ultra vires act that had to be disregarded (para 119).

The CJEU’s Egenberger judgment does not constitute an ultra vires act

In its reasoning, the FCC’s Second Senate convincingly explained why the CJEU’s Egenberger judgment of 2018 does not constitute an obvious and structurally relevant transgression of competences according to the narrowly defined standards of ultra vires review under the FCC’s own case law. After thoroughly assessing the CJEU’s interpretation of primary and secondary law, the FCC underlined that the CJEU’s interpretation was at least defendable and by no means methodologically arbitrary. This is true for the CJEU’s interpretation of the scope and substance of the anti-discrimination law based on Article 19 TEU as well as for the CJEU’s reading of Article 17 TFEU as a provision that does not exempt Member States from obligations under EU law when it comes to the autonomy of churches, but protects the autonomous status of churches (as defined by national law) as a legal interest that can be balanced against other principles (paras 236 et seq).

Interestingly, since the Diakonie could not rely on the right to vote, which gives concrete expression to the principle of democracy, the FCC rooted ultra vires review predominantly in the principle of conferral and, in particular, in the principle of the rule of law (see para 227) which is, in its essential core, also protected under the so-called eternity clause under Article 79(3) of the German Basic Law. This new line of reasoning had already been hinted at in the NGEU case (see here, at para 127), but is only now revealing its full significance.

As convincing as the outcome of the FCC’s ultra vires review may be, and as much as it may be regarded as an act of friendliness towards EU law on the part of Karlsruhe, it nevertheless highlights the structural problems of ultra vires review by national apex courts. Ultimately, the FCC is reviewing the interpretation of EU law by the competent European body, thereby undermining the CJEU’s exclusive competence in delivering the definitive interpretation of EU law. The substantive and methodological standard of this review is ultimately a European one. The FCC’s limited ability to conduct such a review is illustrated, amongst others, by the fact that the spectrum of academic writing used by the FCC as a point of reference for assessing the acceptability of the CJEU’s interpretations of EU law is derived exclusively from German-language literature. On the one hand, this is understandable, as the FCC is a German court. On the other hand, such an approach is, from a European perspective, insufficient given the linguistic and legal diversity of EU law. This diversity is not reflected institutionally in Karlsruhe, but in Luxembourg.

And all of a sudden: Solange ex machina

Then a curious occurrence. Choreographed for maximum surprise effect and doctrinally free-floating, a Solange test suddenly glides into the scene. Unprepared readers may rub their eyes in bewilderment, wondering if they had overlooked something important before. After all, only the incidental ultra vires claim had been declared admissible by the FCC (paras 119 and 128 et seq). And yet, in the reasoning on the merits of the case, clearly separated from the ultra vires review, the FCC elaborates on the question whether the relevant European standards do not fall short “of the fundamental rights standards guaranteed as indispensable by the Basic Law” and therefore do not justify an exception to the primacy of EU law in this respect (paras 233, 254 et seq). In short, the FCC carries out a substantive Solange test in the reasoning on the merits of the case.

Once again, the result reached by the FCC may be regarded as “friendly” towards EU law, as the FCC emphasised the structurally comparable protection of fundamental rights at European level. Not only the abstract body of norms as such, including Article 10 of the EU Charter, but also its concrete application by the CJEU – drawing on the case law of the ECtHR – guarantees a European level of protection of the right to religious self-determination that does not fall short of the minimum level required by the Basic Law (paras 254 et seq). Being specified by secondary law, EU fundamental rights offer a level of protection in the area of religious self-determination that is structurally comparable to that required by the Basic Law (para 266).

The Solange test in the reasoning on the merits raises a number of questions that can only be touched upon here briefly. Mostly, can there be a Solange test without – and beyond – admissibility? It is surprising that the Solange test, which is also explicitly designated as such (para 233), is carried out in the Egenberger decision in the reasoning on the merits, whereas the concept is classically tied to the admissibility. According to the long-established Solange II case law, the FCC does not carry out fundamental rights review on the basis of German fundamental rights in areas fully determined by EU law “as long as the EU fundamental rights guarantee effective protection of fundamental rights in general that is essentially equivalent to the fundamental rights protection that is regarded as indispensable under the Basic Law, respectively [jeweils], and as long as EU fundamental rights guarantee the essence of the fundamental rights in general” (see for the currently used formula here, para 84 with further references).

The general presumption of sufficient protection of fundamental rights at EU level translates into high hurdles at the admissibility stage. Accordingly, constitutional complaints were “inadmissible from the outset” if the complainants did not sufficiently substantiate that “the evolution of European law, including the rulings of the Court of Justice …, has resulted in a decline below the required standard of fundamental rights after the ‘Solange II’ decision” and did not “state in detail that the protection of fundamental rights required unconditionally by the Basic Law is not generally assured in the respective case” (see here, para 62). Until now, it seemed rather certain that this procedural hurdle could hardly be overcome, given the current state of EU fundamental rights protection on the basis of the EU Charter and the case law of the CJEU. The Solange test had therefore become rather a hypothetical instrument. With Egenberger, the Second Senate now carries out a substantive Solange test in the reasoning on the merits without having dealt with it at the stage of admissibility. This raises the question of whether the application of the Solange test (ex officio?) in the reasoning on the merits will have significance beyond the individual case. The Egenberger decision suggests that in future cases the FCC could assess in substance – regardless of the admissibility review – whether certain fundamental rights standards at the EU level fall short of the minimum level required at the national level and must therefore remain inapplicable.

Furthermore, an increased operationalisation of the Solange test could become all the more relevant now that the FCC is serious about focusing this doctrine on the level of protection offered by each guarantee rather than on the general level of fundamental rights protection as a whole. As already announced in Right to be forgotten II (para 47, last sentence), the little word “jeweils” (respectively), which was not contained in the original Solange-II-formula of 1986 (see here, para 117), but introduced in the Banana Market case in 2000 (here, para 62) and reiterated ever since (see here, para 84, but note that several English versions do not accurately translate the original German versions), does not refer to the general minimum standard required at the time in question. Instead, according to the FCC’s recent case law, it means that the test of equivalence must be made “on the basis of a general assessment of the respective fundamental rights guarantee in question” (para 233, emphasis added). In other words, the FCC refers to a test of equivalence that does not relate (anymore) to the general level of protection as a whole, i.e. across all guarantees, but to each specific fundamental rights guarantee in question. And it is precisely this kind of test that the FCC has now carried out with regard to the right to religious self-determination.

Conclusion

Although the outcome of the Egenberger decision may be described as “friendly” towards European law, the exercise of ultra vires review in itself remains problematic, as does the surprising application of the Solange test in the reasoning on the merits of the case. Overall, the Egenberger decision is particularly convincing due to its differentiated determination of fundamental rights standards, combining national discretion with European framework standards. By acknowledging and integrating the requirements of EU law while maintaining domestic specificities with regard to fundamental rights assessments, the decision provides a valuable example of how to manage different layers of fundamental rights.

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