News

It was a great pleasure and honour for me to participate in the ‘Employment Law Panel’ of the DACH - Conference (European Lawyers‘ Association) from 26. to 28. September 2024 in the beautiful and historically significant city of Athens. A big thank you of course goes in particular to my two panel colleagues, Dagmar Junková and Marije van der Tol, for the fruitful internal exchange and the insightful comparative legal comparison and to Friedrike Ruch for her excellent chairing of the panel.

The topic of this year's September conference was: ‘Mobility and Home-Office: Global Challenges and Opportunities’. A form of work that currently is of essential importance for both in-house practice and applicants. The panels „Employment law“ and „tax and social security law’, which were made up of lawyers from various European countries, was intended to give the lawyer members an insight into the differences in national legal systems with regard to mobile working and working from home, after Ms Friederike Ruch (CEO of CONVINUS GmbH) had given a valuable overview of the relevant topics to be discussed in her opening presentation. The focal topics were, in particular: 

Is there currently a legal regulation in the respective legal system or is such a regulation planned? Does the employee have a right to curry out mobile work? What relevance does the principle of equal treatment have when authorising mobile work? What needs to be considered when drafting contracts or works agreements? How is the prospective employer's desire to end mobile working ensured? What legal ‘pitfalls’ and challenges need to be considered when working abroad? To what extent must co-determination bodies, if any, be protected when authorising/organising mobile work? What tax and social security „pitfalls“ need to be avoided (‘Tax and social security law panel’)? 

Discussions within the panel and questions from the audience revealed further interesting issues and differences within the legal systems and also showed that - not least in view of the frequent lack of supreme court rulings - various questions are still unresolved. Reason enough to continue to follow this interesting topic closely and to work out creative solutions when drafting contracts. 

Following the panel contributions, the DACH members received highly interesting and excellently presented insights and outlooks from the keynote speech by Eva Novak (lawyer, management consultant & HR expert), who addressed the topic from a human resources perspective and encouraged them to recognise and leverage the content and potential of new forms of work. After the presentation, all participants were aware of the fact that ‘Generation alpha’ is coming soon! 

Dr Albicker is pleased to once again be invited by the Economic Council ("Wirtschaftsrat") to speak to company representatives on current employment law issues for employers on the aforementioned date. The subject of the presentation this time is: " Burning issues in German Employment Law - an orientation guide for companies based on current labour court rulings and developments".  There are plenty of labour law issues that "burn" and make personnel management massively more difficult for HR managers in day-to-day operational practice. The Bureaucracy Relief Act ("Bürokratieentlastungsgesetz" is now hopefully on the verge of being passed and will bring about long overdue formal simplifications in employment law for employers. However, the pleasure is likely to be limited if one considers the bureaucratic effort involved in connection with the "Supply Chain Duty of Care Act" ("Lieferkettensorgfaltspflichtengesetz") and the "Whistleblower Protection Act" ("Hinweisgeberschutzgesetz").

As the development of case law in the area of holiday law and also with regard to the bureaucratic hurdles in connection with mass redundancies shows, the reality created by court judgements is moving further and further away from the wording of the law. Albicker Arbeitsrecht has long denounced in events and lectures the fact that the legislator has remained inactive for years, if not decades, and has failed to adapt national legal regulations recognised by the ECJ as not being contrary to the directive to the current legal situation, i.e. to amend them in line with the directive. This applies in particular to issues relevant to everyday life such as holiday law (BurlG), the procedure for collective redundancies (Section 17 KSchG) and, of course, the continuing smouldering recording of working hours (ArbZG and ArbSchG). Albicker Arbeitsrecht is convinced that the associated legal uncertainty for HR managers, who are led astray by a "glance at the law" without legal advice, has long since ceased to comply with the principles of the rule of law. Now that staff reductions - irrespective of the continuing shortage of personnel - are increasingly coming back into the focus of companies, recent judgements on protection against dismissal will round off the presentation of Dr. Albicker. Clients of Albicker Arbeitsrecht are entitled to attend the lecture event, which includes a two-course meal, after registering with the firm (preferably by email). Clients of Albicker Arbeitsrecht are entitled to attend the lecture event, which includes a – chargeable - two-course meal, after registering with the firm (preferably by email).

Contact person: Dr. Steffen Albicker (contact information, s. homepage under „Contacts“)

From 23. to 25. May 2024, Dr. Albicker attended the May conference in Rome as a member of the DACH European Lawyers' Association.

Steffen Albicker’s membership and regular participation in the DACH conferences is in line with the purpose of DACH. The objective of DACH is to promote cooperation between German-speaking lawyers in Europe, to promote the exchange of experience and information and to impart and deepen knowledge of the legal system as well as professional and ethical law. For many years now, Albicker Arbeitsrecht involves - where necessary and at the special request of its clients - specialized external advisors to deal with matters that are not covered by the firm's specialisation in employment, corporate and comercial law. Through Dr Albicker's membership of DACH, this possibility also covers mandates within Europe.

As part of this year’s conference in Rome, the focus was on „international contract drafting“ and „digitalisation in the respective national legal systems“. In view of the fact that a large number of globally active companies are clients of Albicker Arbeitsrecht, the contribution from various member states on the respective formal requirements under national law (here: Italy, Austria, Switzerland and France) and the legal effectiveness of „digital signatures“ was of particular interest. And it was of particular interest how similar and how different various legal systems are in different European states. It is a fact that cooperation must also harmonise at a personal level. It is also a fact that the exchange of experiences is particularly successful in Rome with its diverse culinary offerings and good wines.  

If you are interested in further information about the event or information about lawyers from the DACH who may be involved, please contact Dr Albicker personally - free of charge, of course.

Whether as support for the legal department, the secretary’s office or as a trainee lawyer or research assistant  - Albicker Arbeitsrecht is expanding and offers the opportunity to work in a small but excellent law firm to represent the interests of employers and executives. Individuality, flexibility, interesting mandates, excellent training and easy access to the experienced founder are guaranteed at Albicker Arbeitsrecht. 

An application requires a proven authentic interest in the respective vacant responsibility for Albicker Arbeitsrecht linked with proof of relevant excellent skills and knowledge. Employment as a lawyer (m/f/d) requires two law exams with at least a satisfactory grade („befriedigend“) and initial professional experience in the field of German employment law. The employment as a secretary (m/f/d) (preferably part-time up to 25 hours per week, max. 1 day mobile), requires a completed training as a assistant (m/f/d) or very proven excellent experience in office organisation.

The tasks include everything that a secretary (m/f/d) or experienced assistant (m/f/d) usually does in a lawyer's office (use of MS Office package; Excel/PowerPoint, very good written and spoken skills, solid spelling skills (writing from dictation, preferably good written and spoken English skills). A position as a trainee lawyer (m/f/d) or as a research assistant (m/f/d) - preferably also during a doctorate - requires at least a satisfactory first state examination („befriedigend“).

You can expect exciting and complex mandates in employment law with interfaces in corporate and commercial law; participation on the ‘front line’ and not in the back room, concentration on the essentials instead of partner or staff meetings in a modern organised office in a prime location with the best connections. Albicker Arbeitsrecht offers appropriate and performance-related remuneration in line with the requirements, comparable to the remuneration at medium-sized law firms. 

Curious?

Then it's worth taking the next step: apply with complete application documents (CV, supporting documents/certificates)! In writing or by e-mail (kontakt@albicker-arbeitsrecht.de). You are guaranteed an answer about remaining capacity at the time given or prospects of an interview. 

From 1. to 2. February 2024, Dr. Albicker attended the 6. German Employment Law Day 2024 in Berlin as a member of the Working Committee of Specialist Attorneys for Employment Law (German Bar Association)

This year's biennial event was held under the broad and complex legal motto: "The modern world of work between regulatory overload, necessary protection mechanisms and the demands of the market." Renowned representatives from business, science, politics, the judiciary and some representatives of the trade unions (IG Metall) discussed the question of whether German employment law is still up to date and can withstand the demands of the market.

Is it really necessary, in line with the trade union's position and contrary to the European Evidence Directive as well as the practice of the other member states, to require the statutory written form (Section 126 of the German Civil Code (BGB)) for evidence of essential working conditions? By requiring the employer to sign the evidence letter, is it necessary to require the employer's handwritten signature and thus indirectly prevent employment contracts from being concluded in textform for practical reasons? Does the involvement of several committees for the same or similar circumstances  - for example, in the case of operational changes/ staff reductions: attempt to reach a reconciliation of interests with the works council in accordance with Section 111 Works Constitution Act plus informing the works council in accordance with Section 17 (2) of the German Protection Against Unfait Dismissals Act plus consulting the works council prior to dismissal in accordance with Section 102 of the Works Constitution Act - not rather lead to a disproportionate overburdening of employers in relation to the protection of employees? What specific measures should be taken to counteract the continuous decline in collective bargaining coverage in a reasonable way? Isn't the legislator itself contributing to the erosion of collective bargaining coverage by interfering with what is actually the very "business" of collective bargaining parties through legislative activities (such as the planned Federal Collective Bargaining Loyalty/ „Bundestariftreuegesetz“, the introduction of the minimum wage through the Minimum Wage Act or the tendency to privilege those bound by collective agreements in other legislative acts)? Wouldn't it make more sense if the parties to collective bargaining were only given a framework within which to shape their product, namely collective agreements, in such a "sexy" way that this becomes attractive again for employers and employees? And: how can works constitution law still do justice to the current fast-moving developments in the modern world of work? What reforms need to be introduced in order to make labour law, and therefore the Federal Republic of Germany, competitive again?

These and many other questions were discussed intensively at a very high level and at eye level, as is appropriate in a democracy. The exchange between academics and practitioners in the presence of some members of the Bundestag resulted in many thought models and reform ideas for modern labour law that need to be pursued further. The common denominator was the overwhelming conviction that a high level of regulation that overburdens practitioners does not at the same time result in more protection for employees. At the same time, however, it became clear that some of the tried and tested positions are being adhered to and that the discussions must be continued at the appropriate pace, especially as the final political implementation of the ideas will still face considerable challenges.

The high-calibre event has set another innovative milestone for further reform, discussions and possible legislation. Albicker Arbeitsrecht considers participation in such events to be essential in order to keep its finger on the pulse and to represent the interests of the companies represented by the firm in a forward-looking and far-sighted manner. We will report further. If you have any questions about the contents of the event, please do not hesitate to contact Dr. Albicker.

Notwithstanding the change in the legal situation that already occurred on 1 October 2021, there are still standard employment contracts that were concluded after this date and contain the prohibition directed at employees to assign or pledge remuneration claims against their employer to third parties. Such clauses should now, at the latest, fall victim to the "red pencil" within the framework of the recommended regular "contract check-up" of employment contracts.

As is well known, since the modernization of the law of obligations in 2002, clauses in standard employment contracts are no longer covered by the exception under section 310 par. 4 German Civil Code. As a result, as general terms and conditions - like "small print" in other contracts, such as mobile phone contracts, electricity supplier contracts - they are not only subject to “transparency” but also “content” control. Only provisions in collective agreements, works agreements and service agreements are not subject to the provisions of the law regarding general terms and conditions. 

As is well known, the courts have since then put many - previously common - contractual clauses to the test under the law on general terms and conditions. Many of these did not stand up to judicial scrutiny, which has since resulted in employers regularly checking their standard employment contracts for conformity with the General terms and conditions regulations and deleting or adapting any affected clauses. 

Prohibition of assignment:

With effect from 1 October 2021, Section 308 no. 9 German Civil Code was newly introduced into the regulations of the German Civil Code. According to Section 308 no. 9a German Civil Code a provision excluding assignability is excluded "for a claim of the contracting party against the user that is directed towards money". This exclusion thus relates to the common practice of prohibiting the assignment of an employee's remuneration claims against his employer to third parties (for example, banks, landlords, etc.). The circumvention of this exclusion by other provisions is prohibited, too, which results from section 306a German Civil Code. This is the case, for example, with clauses that do not (completely) exclude assignability but restrict it in some other way (e.g., restriction of assignability to certain persons, consent requirements by the employer, etc.). 

The exclusion does not extend to the prohibition (exclusively) of claims of the employee "to pension benefits within the meaning of the Company Pension Act (Betriebsrentengesetz”). Whether and to what extent the parties can provide for a prohibition of assignment in a works agreement requires a legal examination of the individual case or consideration of the respective current case law or the relevant literature. From Albicker Arbeitsrecht's point of view, such clauses are also likely to be viewed increasingly critically, although they are not subject to an examination under GTC law. 

Conclusion:

The ineffectiveness of the above-mentioned prohibition of assignment in standard employment contracts is of immense importance in company practice. Insofar as the applicable legal situation has not been considered so far, there is a need for action on the part of the employer now at the latest.

• The prohibition has no effect. If an employer, relying on the prohibition of assignment agreed since 1 October 2021, still pays the remuneration to its employee without prejudice to an assignment of the remuneration claim of which it has become aware, it is not released from its payment obligation vis-à-vis the assignee. The latter may continue to demand payment of the remuneration from the employer, so that the employer is exposed to double payment. Regarding a possible claim for reimbursement against his employee, he bears the solvency risk and also exposes himself to complex accounting issues.
• This - as well as the amended “German Evidence Act”, which came into force shortly before on 1 August 2022 - give employers reason to carry out the regular "inspection" of their standard employment contracts, which is required anyway, at the latest now. Clauses that provide for a prohibition of assignment or pledging regarding remuneration claims or other payment claims of the employees should fall victim to the "red pencil".
• Whether and to what extent a lump sum for costs can and should be agreed in a permissible manner to compensate the loss incurred by the employer through the settlement of assigned claims should be examined individually based on current case law or the relevant employment law literature.
• Care should be taken with regard to the contractual prohibition of the assignment of any occupational pension claims.

From 11. to 13. May 2023, Dr Albicker attended the May meeting in Paris as a member of the DACH European Lawyers’ Association.

The conferences, which take place twice a year at different locations, also deal with themes that are not related to employment law. Dr. Albicker's many years of experience at the representation of companies and executives have early led to the experience that it is helpful for the clients concerned to look beyond employment law and understand complex economic and business law contexts. The theme of this year's May meeting was international arbitration with numerous professionals working in this field as well as representatives of the well-known arbitration institutions DIS, ICC, VIAC and SAC. The purpose of the association, which has about 550 members in about 25 countries in Europe, is, among other things, to foster cooperation between German-speaking lawyers. At the same time, it sees itself as a platform for lawyers whose clients wish to have German-speaking colleagues recommended to them outside their national location. Clients of Dr. Albicker have always had the opportunity to be connected via his network with selected specialized lawyers within the Federal Republic of Germany for the handling of mandates that go beyond the mandates handled by Albicker Arbeitsrecht. Through the membership in DACH, this opportunity has been extended since this year to matters outside the territory of the Federal Republic of Germany in Europe.

The courts have "delivered". The German legislator has not. 

Given the subject matter and the legislative silence, it is not surprising that employer-questions about the obligation to record working time, its limits and how it should be structured, including collective labour law issues, are playing a dominant role in lawyers' practice. The content and consequences of Act 1 and now Act 2 are extensively discussed in employment law literature as well as in professional networks. However, the desirable extensive legal certainty will only be achieved by Act 3 and thus overdue action by the legislator:

Act 1: Judgment of the ECJ (14.05.2019 - C-55/18, ECLI:EU:C:2019:402):

For about three years it has been established: 

Member States (!) must oblige employers to establish an "objective, reliable and trustworthy system" to record the working time of each employee. This is to ensure the practical effectiveness of the rights conferred by the EU Working Time Directive and the European Charter of Fundamental Rights.

An activity of the legislator to be expected since 2019 could have made the discussions and legal uncertainty on the part of employers that have been conducted in labour law literature since then dispensable. Instead: the BAG overtakes the legislator: 

Act 2: Judgement of Federal Labour Court, BAG (13. 09.2022 - 1 ABR 22/21): 

• The - immediate or long-standing - obligation to record working time does not follow from the provisions of the German Law on Working Hours, ArbZG, (Section 16 II), but - according to the BAG - from Section 3 II no. 1 German Occupational Health and Safety Act, ArbSchG (and thus the protection of safety and health; the BAG interprets the norm in conformity with the directive (EU Working Time Directive).
• A possible works council cannot demand the "whether" of an (electronic) time recording because of the according to the court presently already existing legal obligation (§ 87 I introductory half-sentence BetrVG). It only has a co-determination right in the "how" (design of the time recording).
• The position, beginning, duration and end of the daily working time (including overtime and break times) must be recorded with exact time information (the mere provision of the system by the employer is not sufficient), so that the position of the daily working time and compliance with the daily and weekly maximum working hours can be verified.
• Whether the recording obligation also extends to executive employees - in contrast to the ArbZG - is a matter of dispute; in Albicker Arbeitsrecht's opinion, the better arguments speak in favour of this being the case according to the court decision: the EU Working Time Directive allows for the exclusion of executive employees according to Art. 17 (1) a) in connection with regulations on safety and protection, and the BAG interprets § 3 II ArbSchG in conformity with the Directive. However, the Federal Republic of Germany has not made use of the possibility of exclusion in the ArbSchG yet. And: health protection refers to all employees of a company; furthermore, the BAG names § 5 I 1 BetrVG in its decision (but not III, which refers to executive employees) and states that §§ 18-21 ArbZG (exemption of executive employees) are not applicable. 
• There is leeway with regard to the form of time recording: in principle, any form of time recording, manual or electronic, is permissible. 
• Delegation of the recording duties to the employees is permissible; random checks by the employer are required.
• The BAG repeatedly points out that the legislator has a "leeway to which it is entitled in structuring the recording of working time under EU law". If the legislator does not act and does not pass any binding and finely meshed legal regulations, there remains room for manoeuvre for employers or possible company parties in terms of pragmatic solutions.

Many questions remain open:

Will the legislator make use of its leeway to exempt executive employees and even further employee groups from time recording? According to Albicker Arbeitsrecht, this is likely. 

• Will companies in certain sectors or at least small businesses be exempt from the obligation to record working time? If so, at what workforce size does a small business exist?
• Will there be more generous or more restrictive legal requirements regarding the manner of proper recording, or what will the concrete requirements be?
• How exactly is any trust-based working time to be brought into line with the requirements of the Directive or the BAG; according to the coalition agreement, the possibility of trust-based working time should remain?
• Does the legislator take the opportunity to re-explore its leeway with regard to the - in view of the more generous regulations of the Working Time Directive - far too tight corset of the ArbZG and create more flexible regulations in order to take into account the increasingly flexible working models or the considerably expanded mobile work: 

 For example: 

• Renouncing the maximum daily working time, which the directive does not provide for
• Exclusion of top earners with independent decision-making power? 
• Regulation (if necessary, by teleological reduction of Art 3 of the Directive) as to whether the short answer to an email late in the evening by employees, which is not required by the employer, must actually trigger a new rest period of eleven consecutive hours?

When is Act 3 to come?

In all its lectures and in-house training courses, Albicker Arbeitsrecht points out that the German legislature's failure to adapt German employment laws that no longer conform to Union law according to judgements of the ECJ cannot be reconciled with the principles of the rule of law. In a state governed by the rule of law, it must be ensured that the addressees of a law can read and apply it in practice without the constant support of in-house counsel. These requirements have not been met for a long time, for example, by the Federal Leave Act with its regulations on German leave law, or by Section 17 of the Unfair Dismissals Act with its regulations on mass dismissals. 

The obligation to record working time, which has been calling for a reaction from the legislator for a long time since the ECJ's "time clock decision" in 2019, also belongs to this category. 

Therefore: Act 3 must follow quickly: 

There is an acute need for action by the legislator!

Companies must not be left "out in the cold" with regard to such every day and practice-relevant questions as, in particular, the scope and possible concrete form of the time recording obligation!

There is also a need for employers to act: 

The violation of the time recording obligation is currently not subject to a fine. However, a fine is to be expected in the event of non-compliance with any orders issued by the occupational health and safety authorities. 

Against this background, employers who have so far remained inactive must in any case individually determine whether they should now - in view of the (hopefully) imminent Act 3 - limit themselves to the planning and strategy of the working time recording to be introduced or already now - with the risk of making more far-reaching regulations than intended by the legislator - introduce a suitable system for time recording.

Among other things, the following questions must be examined and decided internally: 

• Working time will have to be recorded - regardless of the legislative decision - for a large number of employees;
• Investigate and purchase a suitable system for recording working time that is in line with the requirements of the BAG. 
• Examine and decide in which form (electronic, paper, etc.) and by whom the time recording should be carried out;
• Examine and decide on the responsibility of random checks in case of delegation of time recording. 
• Confidential working time and time recording are not mutually exclusive.
• Involve the works council in the design or at least a provisional solution until the legislator is active; 

"The latest developments in employment law 2022 - what employers need to know". This is the title of the lecture that Dr Albicker has been invited to by the Chamber of Industry and Commerce Frankfurt (IHK Frankfurt) after it had been postponed for some time due to pandemic situation. An exciting time for an update in view of the groundbreaking decisions of the Bundesarbeitsgericht (German Federal Labour Court) on 13. September 2022 (1 ABR 22/21) with regard to the recording of working time by employers and the cutting-edge three (!) decisions of the European Court of Justice on 22. September 2022 (C- 518/20, C 727/20 and C-120/21) on the further developments of employee holiday entitlement. In addition to these decisions, Dr. Albicker will present further topical rulings and present valuable tips on how to deal with them in practice. Registration for this event will still be possible in the next days (s. homepage IHK Frankfurt). 

"From the employment contract to mass dismissal - a pointed round trip through current labour law developments for employers". This is the title of the lecture that Dr Albicker has been invited by the Economic Council to give to entrepreneurs at Villa Borgnis from 6.30 pm. In view of the decision published by the “Bundesarbeitsgericht” (Federal Labour Court) on 13 September 2022 (1 ABR 22/21) on the subject of the recording of working hours by employers (as a consequence of the ruling of the European court of Justice of 14. May 2022 (C-55/19), this is an exciting moment for a labour law update. Clients of Albicker Arbeitsrecht are entitled to attend the lecture event, which is accompanied by a 2-course menu, after registering with Albicker Arbeitsrecht (preferably by email).

Contact: Dr. Steffen Albicker - Contact details. s. Homepage Contact

On 23. June 2022, the German Bundestag has – with considerable delay - resolved the German Evidence Act to implement the EU Directive 2019/ 1152 of the European Parliament and of the Council of 20. June 2019 on transparent and predictable working conditions in the European Union. The changes in the law require a quick review of the employment contracts currently in use in Germany and the information about “essential working conditions” provided to employees in Germany to comply with the German Evidence Act. 

There is not much time left for this!

In the case of employment relationships newly established on or after 1 August 2022, information must in some cases be provided on the day of the first work performance. 

For employment relationships already in existence before 1 August 2022, the relevant evidence must only be handed over upon request by the employee, but then already on the 7th day upon receipt of the request. 

Temporary jobs of up to one month are no longer exempt from the Evidence Act, so that the law applies to all employees in the future. 

I. A brief overview

1. Fine of up to € 2000.00 may be imposed!

Until now, violations of the Evidence Act were mostly without consequences.

New: a fine (administrative offence) of up to € 2000.00 is threatened for each infringement, i.e., if the document containing the essential terms of the contract 

• has not been handed out, 
• has not been handed out correctly, 
• has not been handed out in full, 
• has not been handed out in the prescribed manner or has not been handed out in good time. 

Checks by the authorities are going to take place. 

2. Important: (though permitted by the Directive) digital/electronic is not sufficient in Germany!

The Directive provides for simplifications regarding the form. It provides that it is sufficient if the evidence is transmitted electronically. Not so in Germany! 

As far as can be seen, Germany is the only EU member state not to have made use of this option. 

Consequence: The “legal written form” (Section 126 German Civil Code) is still required. 

As a result: 

A handwritten signature on a paper printout is required. Transmission as a scanned document is not sufficient. If the evidence is already provided in the form of a hand-signed employment contract, this generally renders the separate transmission of a letter of evidence superfluous. 

If the evidence is provided via the employment contract, this makes it according to the law basically unnecessary to provide evidence in a separate document. This is unfortunate for companies that, despite existing concerns, have started to conclude employment contracts electronically: 

For the aforementioned reason, they are now forced to provide all evidence separately in a hand-signed letter on a paper document. Consequently, all essential terms and conditions of employment must be recorded again. 

Whether it is better to provide the required (extended) evidence in the employment contract or by means of a separate form must be examined in each individual case. For the latter, only the employer's declaration is required.

3. Catalogue of “essential working conditions” according to Section 2 of the Verification Act extended!

The following conditions must also be included in the declaration in the future, if relevant in the individual case: 

• end date for fixed-term employment relationships.
• possibility for employees to freely choose their respective place of work, if agreed.
• duration of probationary period, if agreed.
• remuneration for overtime.
• the due date for payment of wages and the form in which wages are paid.
• agreed rest breaks and rest periods and, if shift work has been agreed, the shift system, shift rhythm and conditions for shift changes;
• details of work on call, if agreed.
• the possibility of ordering overtime and its conditions.
• any entitlement to training provided by the employer.
• in principle: the name and address of the occupational pension provider if one is granted.
• "Legal remedy" by indicating the procedure to be followed by the employer and the employee when terminating the employment relationship (details are debatable and subject to legal review, 
• But as a minimum is to be mentioned: the requirement of the written form and the time limits for terminating the employment relationship as well as the time limit for bringing an action for unfair dismissal);
• reference to the applicable collective agreements, works or service agreements (as well as regulations of commissions with equal representation which determine working conditions for church employers on the basis of church law);
• extended documentation requirements for situations in which employees work abroad for longer than four consecutive weeks and/or the stay abroad falls under the scope of the Transnational Posting of Workers Directive (96/71/EC) in the context of the provision of services.

4. New (shortened) three deadlines for written information!

Previously applied:  Notification at the latest one month after the agreed start of the employment relationship.

New: The German Evidence Act differentiates according to the subject matter of the information and provides for staggered shorter deadlines (1st day of work performance, 7 days or 1 month after the agreed start of the employment relationship).  

We recommend to use the shortest period as a guideline and hand over the documents on the first day of performance of work, at the latest, in order to save unnecessary effort and to avoid the risk of missing deadlines.

Important:  In the case of changes to essential contractual conditions during the employment relationship, the following applies in principle: 

Notification must take place no later than the day on which the changes become effective! Appropriate processes should therefore be set up within the company. 

5. Further changes of the German Employment law: 

• Duty to inform about possible claims of employees to further training provided by the employer and the bearing of costs.
• In the case of a “takeover request” by a temporary agency worker: new duty to provide information in the case of the supply of temporary agency workers and new duty to respond by a deadline on the part of any hirer at the request of temporary workers after conclusion of an employment contract. 
• Part-time workers: facilitation of transition from fixed-term to permanent employment relationship; one-month deadline for employer to respond to employee's request.
• On-call work (“Arbeit auf Abruf”): Obligation to agree on a “time frame” (=reference hours and reference days) within which employer can call off work. 

II. Need for action and recommendations for companies

Important: Employers in Germany must act on their own or, if necessary, with the assistance of their employment law advisers to avoid any fines.

The following procedure is recommended:

1. Clarification whether employment contracts have been or may be- in the foreseeable future - concluded electronically or – better - by handwritten signature. 

If the employer intends to fulfill the obligations of the German Evidence Act just by concluding the employment contract, the (legal) written form must be observed!

2. Check which form was used in the past to comply with the obligations of the German Evidence Act (former catalog of “essential working conditions”). Was this done via employment contract or separate document. 

3. Individual check which relevant essential working conditions from the extended catalogue of the German Evidence Act must be supplemented by the particular company.

4. Examination/ discussion as to whether the evidence should be provided by wording in the standard employment contracts or by a separate form; it is also possible to provide information partly by means of the employment contract and partly by means of letters of evidence. 

5. Observing the legislative deadline of 1 August 2022 regarding new employees or prepare the reaction if already employed employees demand corresponding evidence (e.g., preparation of templates, etc.). It should be discussed and considered to provide all employed workers with a standardized letter independent from any individual demand. 

6. The employment contract should always be concluded before the employee starts working. 

If the evidence of the “essential working conditions” is made by means of an evidence letter (instead by means of an employment contract) this letter can be handed out separately when signing the employment contract. 

In this case, it should be pointed out in writing by the employer that 

• the evidence letter is meant to fulfill the obligations under the German Evidence Act and 
• any declaration can be updated or modified at any time (useful, in particular, in case of further adjustments to the German Evidence Act or of a later clarification of currently disputed/ open legal questions regarding the German Evidence Act).

7. Independent from the obligation to comply with the rules of the German Evidence Act, it is recommended to subject standard employment contracts a regular review to see whether they still meet the strict requirements of the constantly developing case law. 

According to German law, terms of an employment contract are considered General Terms and Conditions in the meaning of the German Civil Code. They are subject to a severe control by German labour courts. If a term of a contract is considered invalid by the court, the substitution of it by a valid clause is excluded by German law. 

And: provided that the company once uses a solid standard employment contract, the lawyer's effort for the annual general check is usually manageable.

Employment Law wanted and data protection got? - Are employers defenseless against claims under Article 15 of the General Data Protection Regulation (GDPR) in conflicts under Employment Law?

In practice, HR managers who, within the scope of their competences, would like to concentrate on solving a conflict under Employment law, must look beyond their own professional horizons. Thus, it is increasingly the case that employees do not only defend themselves under employment law but also by other means, for example by asserting a claim for information on processed personal data or the provision of copies pursuant to Article 15 of the GDPR. This is often followed by a claim for damages. It is by no means evil to assume that the "diversions" via data protection claims, which in the opinion of individual data subjects is smart, is often tactical and is intended to navigate to the "exit (higher) severance pay", by means of which the employer is supposed to buy its way out of the increased "nuisance factor". 

Whether it is opportune for employers to solve the problem of an employment law conflict in a different way than is required and appropriate (under employment law) because of the addition of data protection aspects is doubtful and should be carefully considered; especially since this increases the danger that "free riders" could feel motivated to take the "data protection diversions" as an example for themselves. 

As is well known, conflict resolution cannot be predicted with certainty in a mathematical sense. Often the outcome of the conflict - especially in employment law - depends not only on the clarification of legal issues, but also on various individual circumstances, timing, the right reaction at the right time, the legal knowledge and motives of the other side, the "chemistry" between advisors and sometimes even coincidences. Experience has taught us that "snap decisions" - and thus an unchecked and emotionally charged approach - often backfire. The legal situation and strategic approach should always be carefully examined, considering the respective circumstances of the individual case. This is also the case when dealing with Article 15 of the GDPR by HR managers. 

Article 15(1) of the GDPR provides that the data subject first has the right to request confirmation from the controller "as to whether personal data concerning him or her are being processed". If this is the case, he or she has a "right of access" to this information and to the information referred to in Article 15(1)(a) to (d) of the GDPR. According to Art. 15(3) of the GDPR, the controller "shall provide a copy of the personal data undergoing processing".

The question of whether the right to information and the right to a copy are related or two separate claims is still the subject of controversial debate, as are various other data protection issues. For example, the supreme court's clarification of the question of whether a "data subject" can demand to receive copies of entire documents (i.e., entire letters, emails, etc.) containing personal data, or only that the personal data to be communicated pursuant to Article 15 (1) of the GDPR be named (i.e., limited to the personal data contained in the respective document), is still eagerly awaited. It is expected that the European Court of Justice will "shed light on the darkness" of these or other questions within a foreseeable period.

The answer to the first question is: 

No! Employers are not defenseless against claims for the provision of information or copies!

The following legal and experience-based advice may provide HR managers who are confronted with the employee's reaction, which at first glance seems "extraneous" to the separation process, with a rough guide in dealing with the constellation addressed:

Information for employers 1:

Careful examination of the asserted (data protection law) claim, considering the respective current case law on Art. 15 of the GDPR.

Fortunately, the German Federal Labour Court (BAG) has put a "stop" to overly broad claims in two recent court decisions. In both cases, the highest court argued procedurally and rejected the overly sweeping and imprecise claims by dismissing the claims or referring them back to the lower court. 

BAG: Ruling of 16 December 2021 (AZ: 2 AZR 235/21): Provision of information/copies:

The plaintiff, who was employed as head of controlling at the defendant company and whose employment relationship had been terminated on the basis of allegations that had been ascertained via the whistleblower system there, demanded the provision of information about the personal performance and conduct data processed by the employer and "not stored in the personnel file" about him as well as the provision of copies of "his personal performance and conduct data that were the subject of the processing carried out by the employer". 

The BAG considered the claim not to be "sufficiently specific". At the same time, it held that the operative part of the judgment of the lower court (LAG Baden-Württemberg), in which the plaintiff had partially prevailed, was neither sufficiently determined or enforceable. The lower court had "aggravated" the plaintiff's application by supplementing the operative part of its judgement with a reference to exceptions in the BDSG, which in turn were unclear due to undefined legal terms, so that in the event of the plaintiff's success in court, it would not have been clear to which personal data the judgement should specifically refer. With this latest decision, the BAG built on its previous ruling of 27 April 2021. 

BAG: Ruling of 27 April 2021 (AZ: 2 AZR 342/20): Provision of copies:

The plaintiff, a commercial lawyer, whose employment was terminated after only one month of employment, demanded information from the defendant employer (Art. 15 para. 1 of the GDPR) and then - after providing information - demanded copies of "his personal data", which "were the subject of the information provided by the employer", in particular a copy of the complete e-mail correspondence with him. 

This action also failed regarding the requested copies of the e-mails because the application was "not sufficiently specific". The plaintiff had failed to state in an enforceable manner which personal data had been specifically requested. 

It was the plaintiff’s procedural task to indicate in an enforceable manner which personal data are to be the subject of the action (which e-mails precisely). In the case of lack of knowledge, the plaintiff must first obtain this knowledge, which, in case of doubt, can be done by filing a so-called - admittedly more time-consuming – “step-by-step action” (1st step: assertion of the right to information, if necessary, 2nd step submission of an affidavit, 3rd step: right to a copy of the emails resulting from the information). Important: The BAG left open whether - in contrast to the claim for a copy of the information - it would be sufficient to merely repeat the wording of the law (Art. 15 (1) GDPR) in the application. 

Interim conclusion:

Irrespective of the fact that the decisions are subject to criticism in the data protection law literature, and the German Federal High Court of Justice (BGH) in its ruling of 15.06. 2021 - VI ZR 576/19 took a more generous view than the BAG, according to which it was sufficient for the plaintiff to demand the provision of information "by means of the provision of the respective copy of all personal data of the data subject processed by the controller" (the copy claim is thus probably only a "sub-case" of the right to information), the BAG's rulings are an important aid for HR managers, at least in the context of conflicts under employment law. They can be used to defend against possible extraneous claims, often asserted by employees in a "quick-fire". 

The BAG's reasoning should also be helpful for cases of out-of-court assertion of claims under Article 15 of the GDPR. In any case, the data controller can require the data subject to first specify which information or which processing operations the right to information relates to if the data controller processes "a large amount of information" about him or her. 

Advice for employers:

- Have claims asserted in and out of court pursuant to Art. 15 of the GDPR checked for sufficient concretization in the above-mentioned sense by professionally experienced advisors!

- (Written) rejection of claims that are too far-reaching or unspecific (including claims for damages based on such claims)!

- Concise written request to specify the purpose of the request for information and the request for information itself! 

- Recommendable: Standardization of such letters and clear regulation of responsibilities within the company!

- If the examination is negative from the employer's point of view: 

Examination of exceptions according to Art. 15 para. 4 GDPR, Art. 23 GDPR, § 29 para. 1 sentence 2 GDPR, § 34 para. 1 no. 2 GDPR, § 242 German Civil Code - abuse of rights, Art. 12 para. 5 GDPR) and, if necessary, rejection with brief justification (see below). 

Interesting: Ruling of State Labour Court of Saxony v. 17.02.2021 - 2 Sa 63/20: Request for information is a misuse of rights if an employee requests information on working hours processed by the employer in order to (only) be able to present and prove his claim for remuneration for alleged overtime...

Information for Employers 2: 

Observing the deadline (Art. 12 para. 3 sentence 1 GDPR)!

If the request is sufficiently specific, the employer as the "responsible party" must fulfil the claim. After receiving the request, the employer must act immediately. 

Art. 12 (3) sentence 1 GDPR requires “immediate” action and fulfilment of the claim, in any case within a standard period of one month after receipt of the request. This period can only be extended by two months in exceptional cases and with good reason. Important: The non-observance or incomplete processing of the request can trigger a fine as well as damages according to Art. 82 of the GDPR. 

It is advisable to also notify any refusal or request for concretization within the aforementioned period with at least a brief justification in order to avoid the assertion of claims for damages!

Important: document correspondence and compliance with the deadline!

Information for Employers 3: 

Employment Law remains Employment Law and Data Protection remains Data Protection? Often a good idea!

For employers who are well prepared in terms of data protection law, it may be worthwhile from the point of view of employment law to treat the right to information or to be provided with copies as what it is: a right of data subjects under data protection law! 

Anyone who has a legitimate interest in the processing of personal data should receive the information/copies in case of doubt. Employers should therefore, as far as possible, fulfil this right in an orderly and timely manner without reference to the conflict under employment law. 

The focus of those responsible for HR can thus quickly be reduced to the resolution of the employment law conflict. Furthermore, once the data protection claim has been satisfied and the diversions via data protection law has been taken, employees must seriously expect that employers will implement their original ideas with regard to the separation modalities even more consistently than originally intended internally. 

Albicker Arbeitsrecht's experience in comparable constellations in the recent past has repeatedly shown that the intended pressure from the employee side who mainly hopes for a (higher) severance payment, or a completely exaggerated idea of severance payment very quickly decreased with the fulfilment of the tactically conditioned, but duly asserted, claim under Art. 15 GDPR. 

The prospect of the affected employees, who were clearly not actually or seriously interested in obtaining in-depth knowledge about the fate of processed data, did not benefit from a higher severance payment in these cases, especially since the negotiating atmosphere was considerably burdened by the diversions "chosen" by them and the increased effort involved to a certain extent.

Always observe the principle of data economy and the right to data deletion as best as possible 

A sovereign reaction requires, of course, that data protection and its organization are taken seriously in the company. In case of doubt, it is high time to do so. The company's own data protection organization should be set up in such a way that data is sparingly used

and regularly deleted in accordance with statutory deletion periods. Data that has been deleted in accordance with the law or in due time cannot be released, so that the fulfilment of the right to information becomes impossible, i.e., it can no longer be enforced. 

Those who observe the basic principles of data protection law in compliance with the law will not have to fear the right to information.

Information for Employers 4: 

Higher Severance Pay to avoid the provision of information? 

It is not uncommon for the interest in the actual provision of information to dwindle with the promise of a (higher) severance payment. Whether employees who are in the process of being separated and who "actually" have no increased interest in the fate of the processing of their personal data by their employer are well advised (in terms of content and tactics) to assert a claim pursuant to Article 15 of the GDPR to enforce their predominantly employment law interests is doubtful in Albicker Arbeitsrecht's view for various reasons. However, depending on the legal situation and the company's position in terms of data protection law, there may be constellations in individual cases in which negotiations with the employee side may be useful with regard to a more benevolent solution to the employment law conflict. 

Information for Employers 5: 

Settlement of claims pursuant to Art. 15 GDPR in cancellation agreement?

It can be assumed that the claim cannot be effectively waived for the future. Depending on the specific case of conflict, it is nonetheless worthwhile to also address the actual settlement or fulfilment of the claims pursuant to Art. 15 of the GDPR in the termination agreement or, if applicable, to regulate by way of a factual settlement that the parties agree on the proper fulfilment of the claim pursuant to Art. 15 of the GDPR or that the employee has no interest in providing information/copies.

In view of the complexity of the above-mentioned constellations, it is advisable to consult relevant internal or external specialists for an adequate solution.

Great joy on all sides: on 1. January 2021, Albicker Arbeitsrecht launched. Since the beginning of 2022, the first legal trainee has started her six-months practical training at Albicker Arbeitsrecht. 

Whether litigating in court or playing an active role in an employment law compliance investigation, there has been and still is enough to do from day one to support law firm founder Dr. Albicker in handling complex employment law mandates for companies and managers and to get fit - on the way to the exam and into the world of employment law.

Do you also fancy employment law? Would you like to support Albicker Arbeitsrecht in complex mandates for employers and managers? Would you like to train as a trainee lawyer in a personal and relaxed atmosphere in the middle of Frankfurt city centre? 

Then come by for a coffee (after making an appointment). Or: feel free to apply:

The requirement for a successful application: an at least "satisfactory" first state examination ("1. Staatsexamen") with additional qualifications showing a proven interest in labour law, companies, business as well as economy. 

Foreign language skills are a plus. Diverse interests in culture, politics and anything else that is interesting are also a plus...

Contact: Dr. Steffen Albicker - Contact details. s. Homepage Contact

Whether restructuring, mass dismissal or individual matter - the topic of severance pay is known to play a significant role in the resolution of labour law conflicts. Whether, when, under what conditions and in what amount a severance payment must be promised depends on the respective legal position, various individual factors, but finally the best possible and appropriate tactical approach. "Quick fixes", such as an employer simply giving notice „into the blue" on the one hand or a manager's or board member’s unreasonable exorbitant maximum demand on the other hand might quickly backfire. This applies even more if the counterpart has long since set its course in the background with the support of a competent advisor. As is well known, the expensive bill for missteps in labour law comes at the end… 

Important is: there is no entitlement to severance pays under German employment law

Even if there is a basical willingness of the client to make a settlement and to resolve an employment conflict in a socially acceptable way, it is as a starting point advisable to keep the following in mind: 

In general: there is no entitlement to severance pays under German Employment law!

In particuar foreign companies are often uncertain about the scope of the German protection against unfair dismissal, which is due to the wide range of regulations and case law fully comprehensible. Regarding the termination of employment relationships, the particularity of German labour law is in fact that the general and special protection against unfair dismissal precedes the termination of an employment relationship under certain conditions. As an outflow of the principle of the welfare state (Article 22 GG, German Constitution), contractual freedom is thus restricted in favour of the structurally inferior employee. However, the restriction ends when the employer can present and prove the legal requirements for termination, which admittedly requires relevant legal knowledge. For example, a dismissal must be socially justified by a “compelling reason” (extraordinary termination without notice) or a conduct-related, person-related or operational-related reason (ordinary dismissal); furthermore, in case of protection against dismissal for special groups of employees (e.g., disability, pregnant employees, parental leave) a prior approval of the competent authority is required. If, however, the legal requirements are met, the dismissal dissolves the employment relationship (without compensation). The legal situation in the event of termination is then no different from other countries that do not provide for protection against dismissal in principle.

Irrespective of any associated hardship for the employee, which in case of doubt is cushioned by the social security system, the employer's appeal to the fact that an employment relationship ends without payment of severance pay is by no means "immoral". Freedom of contract is protected by German Constitutional Law („Grundgesetz“) and includes the right of each contractual party, and thus also of companies, to establish a contractual relationship, but also to dissolve it again.

Statutory exceptions 

• Social Plan Compensation In an establishment with a works council, the employer is under certain conditions obliged to negotiate with the works council a reconciliation of intests and a social compensation plan, if he plans condsiderate structural changes (such as cutbacks, closing down or relocating operations, etc.). The employees are entitled to a social plan compensation provided for in the social plan (Sections 112, 111 BetrVG);
• Severance pays in case of Dissolution of the employment relationship by the labour court (§§ 9, 10 Protection Against Unfair Dismissal Act)

Where the court finds that an employment relationship was not dissolved by a dismissal, but the employee cannot “reasonably be expected to continue with the employment relationship” or, from the employer's point of view, particular circumstances “render it unlikely that a continued working relationship would be beneficial” to the compan’y business interests, the court shall, upon request, dissolve the relationship and oblige the employer to make an appropriate severance payment. (Important: regarding employees in managerial positions (§ 14 German Protection Against Unfair Dismissal Act) and „Risk Takers“ of certain credit and financial services institutions (§ 2 para. 8 Remuneration Regulation for Institutions/ InstitutsVergV, § 25a para. 5a, 5 b German Banking Act/ KWG) the employer’s request for dissolution of the employment relationship shall not require substantiation)

According to the experience of Albicker Arbeitsrecht, it is always advisable to carefully ascertain the legal position of the employer as well as that of the executive or corporate body. Only after this a serious determination can be made as to where the "journey“ should or can go. 

From the company's point of view, it proves to be unfortunate and "expensive" if "the Chamber" (of the labour court) returns to the court after "internal consultation" in order to "propose" the payment of an exorbitant settlement pay to avert a defeat in the case, that is preventing a return of the employee to his workplace and the back pay of salary for the long duration of the legal dispute. Especially, if this scenario has not been accepted as “calculated risk” prior to giving notice of termination. It is also annoying on the part of a manager, who expects a high severance payment if an enervated employer after long negotiations finally withdraws his original good offer after stubbornly maintaining demands that were legally unjustified. By the same, unjustified overly modest demands of a manager do not lead anywhere. In particular, not to the payment of a satisfactory compensation. 

Severance pays as a matter of negotiation!

Basically, severance pay is a matter of negotiation! 

In the absence of a legal obligation to agree to severance pay, there is consequently no legally prescribed severance pay amount. Depending on the region and industry, the "rules of thumb" that have been taken into account by the courts for many years apply: half a gross monthly salary per year of employment, up to - depending on age and length of service - one gross monthly salary per year of employment. Whether the parties agree on these or even higher severance sums with any further monetary flanking conditions in "severance packages" is suibject to professional negotiations. 

How to negotiate properly? 

Negotiating has to be learned. 

There is no one-size-fits-all solution. Legal, tactical and handling "faux pas" must be avoided.

The challenge is to find the right mix between „legal art" and „tactical skill“. 

Choosing the right specialist to match one's own style is just as challenging. Daily practice shows that the style and approach of labour law advisors - even assuming the same know-how - differ considerably. 

Facts and circumstances differ. Even minor changes in the initial situation can influence the legal assessment. Nor does the client, the opposing party or the opposing lawyer exist. 

Few fields of law deal as much with people, the right strategy, the right timing and communication as employment law. According to the experience of Albicker Arbeitsrecht, a large number of long-lasting intractable conflicts (which as itself leads to higher costs, fees) result from no or clumsy communication. Who can be expected to be "supple" in the separation process when, after a long period of employment, a letter of termination or a legally perfectly pre-formulated termination agreement is dropped in the letterbox without any prior notice? 

The negotiating atmosphere can also be decisively disturbed by inappropriate behaviour (including that of a lawyer). It is often forgotten that the opposing lawyer is not the "other party" He must, of course, represent his client's interests in the best possible way for the purpose of winning the case or negotiating the best agreement in favour of the client. Nevertheless, according to the professional code of conduct, he remains an organ of the administration of justice. Furthermore, Albicker Arbeitsrecht is convinced that it is more helpful to the client if he is informed transparently about his prospective own incorrect legal opinion instead of stubbornly "parroting" it. Furthermore, entering the courtroom without a greeting, refusing to highlight changes to clauses in the draft of a termination agreement by means of a change mode or refusing to confirm the acknowledgement of receipt of delivered documents, which is against professional ethics anyway, can lead to a massive hardening of severance negotiations. Such behaviours exist. Simply put: They are nothing more and nothing less than “kid’s stuff”.

Experience has shown that observing certain guidelines in termination matters is helpful on the way to a successful termination scenario:

“First aid” in Termination Matters for Companies

1. Success is the satisfaction of the client.

Early and thorough identification of the precise legal problem, the objectives and ("dispute) culture" of the company is fundamental for the success of the mandate. A "hard line" and the provocation of a legal dispute is just as unhelpful to a goal-oriented and conflict-averse company as - conversely - to an employer who is unwilling to negotiate and may be financially strapped with an open settlement strategy. 

2. Where does the "journey to court" go to in case of a non-agreement? 

A forward-looking examination of the legal situation is indispensable. Anticipating what the company will face in court already during out-of- court counselling generally is one of the principal factors with regard to a successful conflict resolution. This requires, of course, wild-ranging experience in litigation on the part of the advisor. Advice and representation in court by the same advisor (and not a separate litigator) is more efficient in employment law. 

3. Common core questions:

a. Is the employment relationship subject to the German Protection Against Unfair Dismissal Act? Determination of the personal status of the employee concerned. 

b. Which is the relevant establishment (“Betrieb”) in the meaning of the German Protection Against Unfair Dismal Act? The meaning of what is understood by “establishment” in the case of several existing establishments can be difficult in German employment law. 

c. Is the employee protected by special protection against dismissal (disability, parental/ maternity leave, member of the works council, etc.)? If yes: Preparation of necessary steps (e.g., obtaining official approval by the competent authority, etc.)? 

d. Detailed examination of whether there exist facts to prove grounds for dismissal in the meaning of the German Protection Against Unfair Dismissal Act (in particular, dismissal for conduct-related, personal-related or operational reasons) or a compelling reason (extraordinary dismissal, § 626 German Civil Code). If not, clarification which further steps need to be implemented (issuing of a warning (“Abmahnung”), implementation of an Operational Integration Management (“Betriebliches Eingliederungsmanagement”, etc.)? 

e. Dismissal on grounds of suspicion (“Verdachtskündigung”) preferable? If yes, implementation of necessary steps, in particular hearing of the suspected employee?

f. Need for urgency (e.g., to comply with the two-week dead- line to give extraordinary notice of termination)?

g. Examination and preparation of a proper hearing of the competent works council? 

h. Examination/preparation of the duty to notify mass dismissal (§17 KSchG), including initiation of the consultation procedure with any competent works council; observance/proof of documentation obligations?

i. Contractual check of affected employees (notice period, collective bargaining agreements with old-age provision, severance payment commitment, post-contractual non-competition clause, etc.)?

j. Waiver of post-contractual non-competition clause possible/ expedient?

4. Negotiation tactics/"soft" preliminary issues:

a. By when should the individual personnel measure be implemented? Drawing up and regularly update a "timetable": who will do what and when?

b. First terminate, first negotiate? 

c. Is the counterpart rather solution-oriented or aggressive, fearful, opinionated, etc.? 

d. Is the possible opposing lawyer known on the market or personally? Is he open to constructive and quick out-of-court solutions or is the approach with "concealed visor" the better way?

e. Precautionary consideration of possible interests of the person concerned? (e.g. under social security law: impending “blocking period” (“Sperrzeit”), suspension of unemployment benefit entitlement in the event of a settlement, chances of subsequent employment, known latent intention to leave, financial/personal situation)?

f. Recording of preferred key data (departure date, severance factors, open remuneration, clarification of variable remuneration or other benefits, company car, shares or stock options or deferred remuneration, leave of absence, etc.)? 

g. Tie up any severance package ("best case"/"worst case")? Clarification of procedure for severance offer: "take it or leave it" or "salami tactics"?

h. Who is the competent and communicatively suitable negotiator?

i. Model "classic severance solution" or better "longer-term departure" (without severance pay)? Early (out-of-court) solution via termination or settlement agreement or court settlement? Partial retirement conceivable/ desired?

j. Efficient communication: Open and well-prepared staff appraisal, preliminary clarification of basic willingness to leave, first clarification of key data on the exit solution or submission of a pre-formulated termination agreement? 

k. What is required to preserve evidence?

"First aid " in Termination Matters for Executives

1. Success is known to be the satisfaction of the client. 

Early identification of the specific problem, the objectives and ("dispute") culture of the executive is the be-all and end-all for the success of the mandate:

Which is the individual situation/ attitude of the executive?

Rather a self-confident manager with a realistic chance of a quick follow-up employment, respectively with the "sportive goal" of taking whatever severance pay is feasible with the least effort? Or rather a given inexperience of the manager in separation processes, respectively age- related, psychological-related or family-related emergency with considerable need for financial security, respectively an interest to negotiate a maximum compensation and/ or to delay the separation process? 

2. Clarification of the individual/ legal status of the executive: 

No protection against unfair dismissal (especially because he or she is a member of the executive body, he is employed in a small enterprise only, etc)? Risks because of the status as so-called “Managerial Employee” (§14 German Protection Against Unfair Dismissal Act) or “Risk Taker” (§ 2 par. 8 Remuneration Regulation for Institutions/ InstitutsVergV, § 25a para. 5a, 5 b German Banking Act/ KWG)? Special protection against dismissal (disability, maternal/ parental leave, etc.)? 

3. Urgency of the matter (notice of termination received? Immediate rejection of termination notice required? Is there a threat of criminal charges being brought by the company? Pendency of preliminary proceedings by public prosecutor? Is it advisable to engage a first-class defence lawyer? Should interim injunction proceedings be initiated after unlawful demotion?)?

4. Early clarification of liability issues, in particular directors' and officers' liability claims, including insurance law issues (D&O insurance cover, clarification of coverage situation, negotiation and conclusion of directors' and officers' liability settlements).

5. Clarification of what is going to happen in court in case of a non-agreement. Check for obvious sources of error (failure to recognise the status of executive employees or lack of participation of the competent co-determination body; examination of interfaces under company law in the case of board members (formal errors in dismissal, termination, etc.); failure to observe notice periods?

6. Preliminary questions of negotiation tactics:

i. Is the employer solution-oriented or litigious? 

ii. Experience in similar cases? Reference values in comparable matters?

iii Early agreement on desired "severance package"?

iv. Alternative models realistic and desired (e.g. partial retirement)?

v. Consideration of social security concerns (threat of blocking period, suspension of unemployment benefit entitlement)

vi. Dealing with variable remuneration, shares, stock options, deferred remuneration, company pension scheme, continued use/return of company car)?

vii. Reputational measures, e.g. language rules, especially also for periods of possible leave, need for references, information to third parties)?

All’s well that ends well: 

The appropriate and face-saving resolution of termination matters is more designable than generally assumed if they are not left to chance. Regardless of whether the client is a company or manager/ board member, the following applies: the right things at the right time…

When terminating service contracts with company bodies, the "shot" can quickly backfire. Initial misjudgments, especially formal errors, may have painful legal consequences and therefore be expensive. The Frankfurt Regional Court (“Landgericht Frankfurt”) has recognized this again in its remarkable – not yet final – decision of 26.02.2021 (3-13 O 66/19). 

I. Background

Those responsible agreed: the managing director of the company ( GmbH) had to leave with immediate effect. And as cheap as possible. The managing director was charged with – disputed - gross breaches of his contract, among other things by overstepping his competences. Anyway, he was “incapable from the start”. The mutual agreement offered by the company for the termination of the service contract, while respecting the ordinary four-month notice period, was "withdrawn" by the company. Instead, the chairman of the supervisory board, who at the same time was the chairman of the shareholders' meeting of the company, invited the approximately 250 shareholders on behalf of the supervisory board to a shareholders’ meeting to resolve the dismissal of the managing director and termination of the employment contract "at the next possible date". According to the articles of association of the company, the supervisory board “represented” the company in relation to the managing director. In addition to the managing director of the company, the chairman of the shareholders' meeting or the shareholders with shares of a total of 10% of the company's share capital were entitled to convene the shareholders' meeting. However, the letter of invitation was signed on the letterhead of the supervisory board by the Chairman of the Supervisory Board of the company. The company, in addition to the removal from office, at first issued the ordinary termination of the employment contract and then – approximately two weeks later – the extraordinary termination without notice. The managing director objected to all dismissals and demanded continued payment of his remuneration. The company demanded claims for damages in the amount of € 500,000,- . Approximately four months after the aforementioned dismissals, the company issued (as a precaution) a further extraordinary termination without notice and (as a precaution) another ordinary termination.

II. Decision of the Frankfurt Regional Court

The court found the managing director right regarding all dispute issues at the company’s expense:

1. Both, the ordinary and extraordinary dismissal of a managing director require an effective shareholders’ resolution. The latter, however, was deemed null and void, since according to the law and the articles of association of the company the supervisory board was not responsible for convening a shareholders’ meeting. Consequently, both the extraordinary and ordinary termination of the service contract were null and void (and not only “contestable”).

2. The extraordinary termination issued four months later also failed due to formalities. This time the responsible managing director had correctly convened the shareholders’ meeting. However, the company had not reacted quickly enough by ignoring the statutory deadline in accordance with Section 626 (2) of the German Civil Code (BGB). This stipulates that the notice of (extraordinary) termination may only be given within two weeks. This period commences with the date on which the party entitled to give notice obtains knowledge of facts conclusive for the notice of extraordinary termination. The court pointed out that the company itself had stated repeatedly that the shareholders had already known the grounds prior to giving notice for the first time. Even if, in certain exceptional cases of invalid shareholders’ resolutions, subsequent action may exceptionally be permitted, the competent managing director had been obliged to react much earlier. According to case-law, waiting four months to convene another shareholders’ meeting was considered far too long. 

3. The legal action for damages against the managing director also failed due to formal errors. The judicial enforcement of claims for damages against the managing director of a company in accordance with Section 43 GmbH Act (GmbHG) required a shareholders’ resolution that legitimizes this. The company presented a shareholders’ resolution four days prior to the court hearing. However, the court found this resolution null and void as well. According to the court findings, the shareholders’ meeting was convened again by the wrong person, respectively the company had at least not stated clearly in the process in what name that had been done. 

III. Comments

1. We recommend to regulate carefully and unequivocally all questions of competence in the articles of associations. In addition, clauses should be implemented in service contracts stating that the removal of the company body from office also terminates the service contract (“Koppelungsklausel”), though their validity is currently highly disputed.

2. Shareholders and supervisory boards should not limit themselves to examining whether giving notice of (extraordinary) termination is permissible in the specific case. They should also pay careful attention to the existence and maintenance of legal or statutory requirements. A careful look at both, the articles of association and the law is usually more than "half the rent".

3. The termination of service contracts with company bodies, as well as the judicial assertion of claims for damages, require an effective resolution of the responsible body.

4. Managing directors or members of the supervisory board which obtain knowledge of breaches of duty of a managing director or board member do not have unlimited time to react and to initiate the proceedings required. They must inform the responsible body within a reasonable period of time, usually one week, if necessary, after appropriate investigations have been initiated. The termination must then be made in compliance with the aforementioned statutory notice period of two weeks. If the responsible body for terminating the service contract with the company body, the right to terminate the contract by extraordinary dismissal lapses. This is an unfortunate consequence, especially in the case of fixed-term employment contracts!

5. Litigation attorney like litigation. So do we! However, whether this is the right way forward must be considered carefully in each individual case, taking into consideration the risk of litigation, the time involved, the assessment of the length of the proceedings in ordinary courts and any prospective reputational risk. A mutual agreement with appropriate conditions corresponding to the individual case is often the better means of choice. Emotions and vanities, in any case, generally are bad counselors!

The following article by Albicker Arbeitsrecht gives you an insight into the current legal situation:

Digital work is gaining in importance worldwide

Gig worker, clickjobs, crowdworkers, etc. Not so long ago, these were empty words for the general public, a foreign vocabulary that was difficult to fill with life. This has changed rapidly, especially in the age of Corona. Due to the ordering of a "gig" by click (a short assignment, such as the "gig" of a music band) via a mediation platform, the everyday use of Lieferando, Delivero Hero, Uber and Co., the aforementioned terms for modern forms of work of the digital world of work have arrived in the real world and thus naturally also the judiciary.

The Uber judgment of the Supreme Court (19. Feb. 2021) and other judicial decisions

In its judgment delivered on 19 February 2021 - (2021) UKSC 5) - the Supreme Court qualified two plaintiff former Uber drivers (of more than 60,000 Uber drivers in the UK) as employees. The drivers were in a subordination relationship with Uber. That was apparent, inter alia, from the fact that, in any event, Uber determined the level of drivers' earnings in accordance with the conditions in force (in 2016). Drivers were not able to determine the terms of their services on their own, due to tight contractual requirements. As a result, drivers were not really entitled to reject orders, as Uber could ultimately "sanction" by restricting access to the platform if orders were rejected too frequently. The Supreme Court's decision is in line with rulings by other national courts in the US, Switzerland and the EU according to which Uber were to qualified not as a platform intermediary, but an 'employer'.

Legal situation in Germany

As far as can be seen, a Supreme court decision on the status of the Uber driver has not yet been issued in Germany. But here, too, employment law has moved into the platform economy. With its – quite somewhat surprising – judgment of 1.12.2020 (9 AZR 102/20), the German Federal Laboure Court has qualified a crowdworker as an employee after assessing the actual implementation of the contract between the platform and the crowdworker. The court concluded that the crowdworker could not have determined his activities sufficiently free according to location, time and content due to the design of the processes of the internet platform. The organisational structure of the platform was geared towards the continuous use of "bundles of simple, contractually prescribed, micro-orders" registered via an account in order to carry them out in person. The incentive effect of the evaluation system, which allowed access to “higher levels' when accepting sufficiently many orders, had to be taken into account. The possibility of receiving future orders had created pressure to act.

“False” self-employment as a sword of Damocles over companies 

Over many self-employed activities, often with the best of conscience, the "Damocles sword" of the subsequent determination of "false” self-employment" hovers over many years. With severe social security, tax or labour law consequences for companies: e.g. legal protection against dismissal, holiday pay or compensation entitlements, retroactive for all (!) years of employment; reimbursement of total social security contributions for up to four years (without intent) and possible criminal liability (Section 266a StGB).

The legal uncertainty is considerable. The delimitation criterias of the law or according to jurisprudence are indefinite. Legal advisers can provide valuable assistance in drafting service contracts by leaving wording out which at first glance indicate an employment as employee. However, this assistance is subject to restrictions. As the above-mentioned judgments show, the final qualification of the status of the employed person ultimately depends on the actual circumstances of the contractual relationship and the general “overall view”, taking into account the circumstances of the individual case. In particular, it is necessary to avoid that employees are “integrated” into the organization of the business unit or subject to strict instructions and controls. With regard to the platform economy circumstances shall be avoided which, according to the above-mentioned judgments, led to the qualification of an employment relationship. Uber's announcement that it is “adjusting” the terms of its terms is therefore unlikely to be expedient. How uncertain a legally secure assessment is in general also shows that the lower courts in the aforementioned case assumed that the crowdworker was independent. From a social security point of view, the initiation of a status procedure (“Statusverfahren”)in accordance with Section 7a SGB IV (“German Social Code”) might in some cases be helpful right at the beginning of the beginning of the employment.

Business model: platform economy - where does the journey go to?

The business model has many advantages. It is based on flexibility, an “on-demand-model” which is apparently perfect for self-employed persons and relevant cost savings. In any event, the current tendencies of case-law have given it the “dampener” of legal uncertainty. Companies in the digital industry are therefore no different from many in the analogue world, such as consultants from the IT industry. In any event, the (threatening) subsequent determination of dependent employment by the courts or authorities is likely to have a shock effect in large parts of the sector. Any massive negative financial consequences are likely to call into question many models of the first hour. The EU Commission and national legislation have set themselves the goal of improving the working conditions of platform workers. If the trend of jurisprudence continues and those working in the platform economy are granted extensive workers' rights, their pioneering period is likely to end before it has really started. Further legal developments must be closely monitored. In the end, as always: one employee’s meet is another man’s poison”

Albicker Arbeitsrecht regularly gives lectures to HR Managers regarding German Employment law topics. This includes, among other things, the legally secure handling of German Vacation Law (BUrlG). Since the fundamental decision of the European Court of Justice (ECJ) in the case of "Schultz-Hoff" and the large number of court decisions that followed, no stone has been left standing in German Labor Law. A look at the German Federal Holiday Act (BUrlG) is no longer sufficient to take account of the profound changes in operational practice as a personnel manager. In particular: the same question at the end of each year: can remaining vacation days be transferred into the new year? When does it expire? And what are the duties of employers?

Albicker Arbeitsrecht is pleased about its participation in the webinar series of the Chamber of Industry and Commerce (IHK Hanau) "Kurz mal Recht" on 28. January 2021 from 8:30 am to 9:00 a.m. ("Deadline March 31st - transfer and expiry of vacation days?) and the opportunity to inform HR managers - in a nutshell -  about the current legal situation and to give valuable recommendations for further action.

Registration for the lecture against payment is only possible exclusively via the registration form of IHK Hanau: https://www.hanau.ihk.de/recht/kurz-mal-recht-4953424

See more under:

https://www.juve.de/nachrichten/namenundnachrichten/2021/01/frankfurt-arbeitsrechts-partner-von-buesing-gruendet-eigene-kanzlei

Just in time for the beginning of the year, the starting signal was given. Albicker Employment Law was lauching. Attorney-at-law Dr. Steffen Albicker established a law firm specialized in German employment law. Focus: the representation of companies, corporate bodies as well as executives. From 2011 to 2020, Dr. Albicker was a partner at the nationwide commercial law firm Büsing, Müffelmann & Theye and heading the employment law department for the Frankfurt office.  With the founding of his - professionally diverse - specialist law firm for employment law, Dr. Albicker is realizing a long-cherished dream. Fewer partner meetings. More time for employment law. More time for clients. Collaboration in non-specialist areas with other top-lawyers within his excellent network.