Compensation under the General Equal Treatment Act as income or assets in the context of granting legal aid

Compensation payments under the General Equal Treatment Act (AGG) can be taken into account as income or assets in the context of granting legal aid. This was decided by the Düsseldorf Regional Labor Court in its ruling of July 4, 2024 (9 SLa 359/24).

Facts

The ruling of the Düsseldorf Regional Labor Court (LAG) is based on the following facts: A plaintiff applied for legal aid (PKH) in the appeal proceedings. In the proceedings, the plaintiff asserted claims under Section 15 (2) AGG. The plaintiff had already conducted similar proceedings. At the time of the decision, the Ninth Chamber of the LAG Düsseldorf alone had received four applications from the plaintiff for legal aid. The respective proceedings concerned the plaintiff's claims for compensation pursuant to Section 15 (2) AGG.

The Regional Labor Court therefore requested the plaintiff to provide further information on his personal and financial circumstances. This concerned in particular the plaintiff's income from compensation payments under the AGG within a period of twelve months. The account statements submitted by the plaintiff showed cash receipts from compensation claims, but did not fully document all inflows during the relevant period. The plaintiff refused to provide further information, pointing out that compensation payments did not constitute assets within the meaning of Section 115 of the German Code of Civil Procedure (ZPO) and that the requirement to disclose payment transactions for a period of twelve months was disproportionate.

Reasons for the decision

The Düsseldorf Regional Labor Court rejected the application for legal aid. Pursuant to Sections 115, 117, and 118 of the German Code of Civil Procedure (ZPO), the court was entitled to request extensive information about personal and financial circumstances. This included information about all compensation payments received during the period in question. The court could also request the submission of bank statements covering a period of twelve months in order to be able to conclusively examine the plaintiff's financial situation. The plaintiff's refusal to provide this information made it impossible to verify his financial situation. The court therefore had to assume that the plaintiff had sufficient funds of his own to bear the costs of the proceedings.

The court clarified that compensation under Section 15 (2) AGG may constitute income or assets within the meaning of Section 115 (1) sentence 1, (3) ZPO. In making this assessment, the court referred to the case law of other regional labor courts. Compensation under the AGG did not serve to compensate for “pain,” but primarily to prevent further discrimination by the debtor, which is why its consideration within the framework of PKH was not excluded from the outset. Whether the payments were to be regarded as income or assets in individual cases could only be decided conclusively after full disclosure of all earnings.

Practical tip

Those who claim compensation under the AGG on multiple occasions cannot automatically expect financial support for litigation. It is to be expected that courts will carefully examine whether these plaintiffs are actually in need or whether they already have sufficient funds of their own to finance proceedings due to income from numerous compensation claims.