Outsourcing or illegal labour supply? German customs come down hard in 40-driver case

The case was uncovered by Finanzkontrolle Schwarzarbeit, a unit within Hauptzollamt Lörrach that investigates illegal employment, among other offences.

At first glance, the arrangement appeared to be a partnership between a German transport company and two Lithuanian carriers. The inspection revealed a different arrangement: the contractual setup did not match the way the drivers actually worked.

Drivers employed in Lithuania were effectively working for a German carrier

The 40 foreign drivers held employment contracts with two related Lithuanian transport companies. German customs investigators concluded that the drivers were, in practice, fully integrated into the operations of a carrier near Freiburg and worked exclusively according to that company’s instructions. The German business paid the Lithuanian companies a set amount for each driver. The payments covered the drivers’ wages and Lithuanian social insurance contributions.

The issue was not simply that the drivers were employed by companies based in another country. Inspectors challenged the true nature of the business relationship.

Contracts presented the arrangement as an independent service

Hauptzollamt Lörrach said the director of the Lithuanian companies knew that the supply of workers required authorisation from the Bundesagentur für Arbeit. Nevertheless, the cooperation was structured as so-called Werkverträge. Under German law, these contracts involve an independent contractor delivering a defined piece of work or achieving an agreed result.

According to customs officials, this structure was intended to create the impression that the drivers were not part of the German company’s workforce. The inspection found the opposite. The drivers operated within the German carrier’s organisation and followed its instructions.

Because the drivers were operationally subordinate to the German company, authorities classified the arrangement as the unauthorised supply of workers.

Fines totalling €35,000 in a case involving 40 drivers

Hauptzollamt Lörrach fined the director of the two Lithuanian companies €20,000. The German entrepreneur who used the drivers’ services was fined €15,000. The combined penalties therefore came to €35,000, and both decisions are now final.

Dividing the total by 40 drivers produces an average of €875 per driver, but this does not mean that German law sets a fine of that amount for each worker. The published information does not explain how the penalties were calculated or state the maximum fines available, so their legal severity cannot be assessed on that basis.

Authorities assess how the work is performed—not just the contract label

For the road transport sector, the central issue is the distinction between outsourcing a transport service and supplying workers to a customer. The name or format of the contract was not decisive for German authorities. What mattered was who organised the drivers’ work, gave them instructions and integrated them into the company’s operational structure.

That distinction matters in cross-border cooperation and subcontracting, both of which are widespread in the sector. A relationship can have legal consequences when personnel supplied by an external service provider are, in reality, subordinate to the contracting company. The Freiburg case also shows that a contract between companies may not be sufficient when the actual working arrangement differs from the paperwork.

In this case, the inspection resulted in final sanctions for both parties: the companies that supplied the drivers and the company that used their labour.