External teams and the works council: what the BetrVG says

A German works council has a right to be told about external people who work in its establishment, whoever employs them. Whether it can also approve or refuse their deployment depends mainly on one thing: whether the host company holds at least part of an employer's instruction rights over their work.

This article reads the statute and Federal Labour Court (BAG) decisions. It is not legal advice. A lawyer should confirm how it applies to a specific contract.

What must a company tell its works council about an external team?

Section 80(2) BetrVG says the works council must be informed in good time and comprehensively. The duty "also extends to the employment of persons who are not in an employment relationship with the employer" (our translation). It covers in particular the scope of time, the place of deployment and the tasks of these persons, and on request the contracts behind their deployment count among the documents the works council can see.

The BAG reads this provision narrowly in one respect. In 1 ABR 48/17 of 12 March 2019, it held that the sentence covers all outside personnel, including agents of firms working under work or service contracts. It also held that the sentence only clarifies who is covered. It does not widen the works council's competence to external staff, so the information claim still needs a task of the works council for which the information is required. The court added that a claim about outside personnel requires that a participation right concerning the company's own employees is conceivable, and on that basis it allowed a request for information on accidents suffered by another company's staff while using the employer's infrastructure.

Section 92(1) BetrVG adds a second duty. In personnel planning, the employer must inform the works council about present and future staff needs and the resulting measures, "including the planned employment of persons who are not in an employment relationship with the employer". It must also discuss them. An external team that fills a hiring gap therefore belongs in that conversation, apart from any approval question.

When does an external team count as a hiring under section 99?

Section 99(1) BetrVG applies in companies that regularly have more than 20 employees entitled to vote. Before every "Einstellung" (hiring), the employer must inform the works council and ask for its consent. The works council has one week to refuse in writing with reasons, and if it stays silent, consent is deemed given. Section 99(2) lists six grounds for refusal, so a refusal that names none of them has little force.

The statute does not define "Einstellung" for external people, but the BAG does. In 1 ABR 57/14 of 8 November 2016, it described a hiring as integrating people into the establishment so that, together with the existing staff, they fulfil its working purpose by tasks subject to instructions. The legal relationship to the host is irrelevant. A person is integrated who does work subject to instructions that the employer organises, and the employer must hold the right to instruct typical of employment and decide on the use by content, place and time.

The same decision shows how much a host can do without crossing that line. Contractor staff working on the host's premises is not enough on its own, and neither is work planned into the host's processes by type, volume, quality, time and place. Close physical cooperation, or briefing and coordination by host staff, does not settle the matter either, and the same holds where host employees did the activity before. In that case, a clinic had moved its reception service to a group service company under a work contract. The BAG upheld the finding that the clinic had no instruction right over those staff, because their deployment, including duty and leave plans, was decided by the service company. Instructions from clinic staff, the court added, do not necessarily mean integration, because a client may instruct a contractor on carrying out the work.

The result can go the other way. In 1 ABR 50/12 of 13 May 2014, a logistics company had passed some transport work to another firm, and the works council claimed a right over that firm's drivers. The employer drew up the duty rosters that also named those drivers. The BAG held that this partly exercised the right to direct work on content, place and time, which supports a position as employer towards them. It sent the case back for further findings.

The test is current. 1 ABR 25/24 of 23 September 2025 applied it to managers employed in another group company, and 1 ABR 18/25 of 27 January 2026 restated it. The 2025 decision says the host needs at least a partial instruction right, that nothing different applies to external staff on service or work contracts, and that section 99 does not let a works council co-shape the mere coexistence of staff from different companies in one establishment. Temporary agency workers are a separate case: section 14(3) of the Arbeitnehmerüberlassungsgesetz requires the borrowing establishment's works council to be involved under section 99 before they start.

For a software team, our reading is that the facts of daily work decide: who assigns tasks, who sets working hours, who runs the daily meeting. On our site, we describe a dedicated team as one where the client's product owner sets the goals and the order of the backlog, while our team lead assigns the work and runs the daily meeting. In the BAG cases, the court looked at who exercised such functions, so a role description alone proves little. A lawyer should test it against the real set-up.

Can the works council decide on the tools an external team uses?

Section 87(1) no. 6 BetrVG gives the works council a right of co-determination on the "introduction and use of technical devices intended to monitor the behaviour or performance of employees", where no law or collective agreement already regulates the matter.

The BAG reads "intended" widely. In 1 ABR 7/15 of 13 December 2016, it held that a device qualifies if it is objectively suited to collect and record information on behaviour or performance. The employer's intention does not matter. It is enough if only part of the monitoring is done by the device, and enough if the data are entered by hand and then processed by it. The court applied this to the visitor-post function of a company Facebook page. In 1 ABR 20/21 of 8 March 2022, it treated Microsoft Office 365 as such a device, but the parties did not dispute this, and the case itself was about which works council was responsible.

An external team usually works in the client's tools, such as repositories, ticketing and time tracking. Our reading is that such a tool is likely to meet the BAG's wide test when it records data about the client's own employees, for instance code reviews or ticket assignments. Section 87 speaks of "Arbeitnehmer", which section 5 BetrVG defines as workers, salaried staff and trainees, with some listed additions. Whether a device that records data only about external people falls under no. 6 is not answered by the text, and we found no BAG ruling on it.

Where does AI come in?

The statute mentions AI in two places. Under section 80(3) BetrVG, if the works council must assess the introduction or use of AI to carry out its tasks, calling in an expert counts as necessary. Under section 90(1) no. 3, the employer must inform the works council about the planning of work procedures and workflows "including the use of artificial intelligence". Section 90(2) requires a discussion in time for the works council's proposals to be considered.

Section 87 has no AI wording. The Federal Government's explanatory memorandum to the bill of 22 April 2021 describes the section 90 change as a clarification and the section 80(3) change as removing the check on whether an expert is necessary. Our reading is that AI tools fall under no. 6 only when they meet the BAG's test for a device that can monitor behaviour or performance.

For AI coding assistants used by an external team, two questions stay open: whether the tool records data on your employees' behaviour or performance, and whether it is part of a work procedure you plan. We found no court decision that answers either.

A checklist before an external team starts

This is our addition. It turns the texts and decisions above into questions for the person preparing the start, and it is not a legal test. The questions follow the order in which the issues arise.

1. Is there a works council, and does the company regularly have more than 20 employees entitled to vote, which is the threshold that section 99(1) sets for the approval right?

2. Has the works council received the section 80(2) information on time, place and tasks, and, on request, the contract that sits behind the deployment of the external people?

3. Is the plan for the external team part of the personnel planning that you must inform the works council about and discuss with it under section 92?

4. Who gives instructions on content, place and time, given that the BAG test for a hiring may be met if the host does so even in part, and that the one-week period in section 99(3) starts once you have informed the works council?

5. Which tools will the team use, and do they record behaviour or performance data about your own employees, in which case section 87(1) no. 6 should be checked before roll-out?

6. Will AI tools be used inside work procedures that you plan, in which case sections 80(3) and 90 may apply to the introduction of those tools?

7. Has a lawyer reviewed this specific contract and set-up before the team starts, so that the answers above rest on the real facts?

Our page on how we work describes our process, if you want to see how a team is organised before you raise these questions with your works council.

What we could not confirm

We found no BAG decision on whether section 87(1) no. 6 covers devices that monitor only external staff, or on AI coding assistants used by an external team. In 1 ABR 20/21 the parties did not dispute that Office 365 is a monitoring device, so the court did not decide that point in depth. We also cannot say how a court would treat a particular team model.

We found no official BMAS page on these sections for external teams, so our legal points rest on the statute text and BAG decisions. We did not read legal commentaries or lower-court rulings, and we did not check collective or works agreements, which can change the rights described here.