When an employee is hired out it is as a rule the hirer-out
rather than the hirer who acts as the employer in terms of labour
and social insurance law. In a ruling of 2017, the Supreme
Administrative Court found that when an employee is hired out in
order to act as managing director with the hirer this establishes
an employment relationship (also) with the hiring company which
latter becomes the employee's employer under social insurance
law (Ro 2014/08/0046). The court reasoned chiefly that the
employing GmbH has acquired a direct right to the work of the
managing director (due to its own legal relationship from the act
of appointing him/her managing director).
This legal opinion does not just contrast the fact that the
social insurance category is determined solely by the in
personam contract and not by the position, but it also lacks
practical relevance because the third-party employment of managing
directors within a group is recognised under labour law as well
