Lex localis - Journal of Local Self-Government_11(1)_January

L EX LOCALIS - J OURNAL OF L OCAL S ELF -G OVERNMENT D. Senčur Peček, S. Laleta & S. Kraljić: Labour Law Implications of Outsourcing in Public Sector 709 provided by the new contractor does not support a conclusion that the economic entity has been transferred. The economic entity cannot be reduced to the activity entrusted to it. Its identity also emerges from other factors, such as its workforce, its management staff, the way in which its work is organised, its operating methods or, where appropriate, the operational resources available to it. 20 Subsequent judgements of the Court of Justice of the EU demonstrate that in determining whether the economic entity has been transferred, it is important to distinguish between businesses (activities) that operate on the basis of assets and businesses in which assets are not important, but which depend for their operation on workforce instead. In the case of businesses that operate on the basis of assets, equipment, the transfer of an undertaking may occur only if the movable or immovable property was permanently or temporarily transferred. 21 If the transfer of assets (and the use thereof by the transferee) had occurred, the undertaking was transferred as well, which means that the transferee shall also take over employees and safeguard all the rights thereof. This also applies in the case of outsourcing (cases Liikene, C-172/99, 25 January 2001, Abler and Others, C-340/01, 20 November 2003, Air Pascual and Others , C-509/14, 26 November 2015). In certain sectors (e.g. cleaning, surveillance) the economic entity may function without any significant assets, and the maintenance of its identity therefore cannot depend on the transfer of such assets. 22 In the Court's opinion, the essential element in these sectors is a workforce, which is why a group of employees who are permanently performing a certain task may amount to an economic entity (cases Süzen, Hernandez Vidal and Others, C-127/96, C-229/96 and C-74/97, 10 December 1998; Hidalgo and Others). In a number of such cases, the Court noted that an economic entity is maintained only if the transferee has taken over the majority of the transferor's employees (in terms of their numbers and skills) who were assigned by the transferor to a certain task (Hidalgo and Others, Temco, Clece, C-463/09, 20 January 2011). According to this interpretation, in relation to these activities the transfer of an undertaking (and therefore the protection of employees) actually depends on the will of the transferee or on the agreement between the transferor and the transferee on the transfer of employees, which is contrary to the spirit of the Directive, which was adopted in order to safeguard the employment relationship of employees (Barnard, 2012: 597). The essence of the Directive lies in the fact that it is intended to ensure the continuity of employment relationships and to safeguard rights of employees employed by this undertaking or part of the undertaking in the event of the transfer of an undertaking or part of an undertaking. 23 If the undertaking or part of the undertaking retains its identity in the event of a transfer, the Directive applies, and the transferee must take over all employees and ensure that they have the same rights as they had with the transferor. In the case of labour-intensive activities (taking into account this interpretation of the Court of Justice of the EU), the answer to a question of whether the undertaking or part of the undertaking has retained its identity