Frequently asked questions and answers

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Termination of employment

Do not let yourself be put off your guard. If you have received a notice of termination from your employer, you can file an action for protection against dismissal with the competent labour court within 3 weeks of receiving the notice of termination.

Document the date of receipt of the notice of termination so that a claim can be filed in due time. Remember to register with the employment agency as a jobseeker promptly after receiving the notice. This will prevent the reduction of benefits.

Find out about the possibility of bringing an action against unfair dismissal and possible claims. It is not necessary to be represented by a lawyer in the first instance before the labour courts. However, it is usually worthwhile to seek the professional support of experienced lawyers when dealing with complicated legal issues.

Dismissals by the employer are very often invalid. You can fight for the continuation of your job by means of an action for protection against dismissal. As a rule, however, a severance payment from the employer to the employee is obtained in the context of a dismissal protection action.

Legal fees and court costsare incurred in the course of a dismissal protection process.

The court costs are based on the amount in dispute, which in the case of actions for protection against dismissal is calculated on the basis of 3 months' gross earnings. The court costs are borne by the party that loses the case. If a settlement is reached between the parties, the court costs are waived.

The attorney's fees, which are based on the German Attorney's Fees Act (Rechtsanwaltsvergütungsgesetz), are borne by each party in first-instance dismissal protection proceedings, even if the case is won.

If they have legal expenses insurance, the costs of the legal dispute will be covered by the legal expenses insurance, provided that the insurance cover extends to disputes under employment law.

If you bear the costs yourself, it makes sense to bring an action against unfair dismissal if the settlement to be obtained exceeds the costs of the proceedings. Of course, you will be informed about this by our partner lawyers.

In principle, the amount of severance pay is a matter of negotiation; there is no statutory entitlement! However, severance pay is usually paid by employers if a notice of termination is legally contestable.

In these cases, the calculation is usually based on the following formula:

0.5 gross monthly salary per year of employment

The severance payment is not tax-free, but must be fully taxed. Severance payments are considered extraordinary income and social security contributions do not have to be paid on them.

Particularly in the case of high severance pay, the resulting higher income increases the tax rate within the framework of progression.

However, the so-called one-fifth rule is a possibility to reduce the amount of tax when receiving a severance payment (§ 34 EStG).

The existence of a social plan does not exclude the possibility of bringing an action against unfair dismissal. On the contrary, an action for protection against dismissal usually makes sense even in spite of a social plan with a claim to severance pay. A higher severance payment can certainly be obtained in the course of an action for protection against dismissal.

The social plan in itself does not allow any conclusions to be drawn about the effectiveness of a termination. It is best to have the termination reviewed by a lawyer. If necessary, a satisfactory solution can also be found by way of a renegotiation.

As a rule, it does not make sense to take legal action against a dismissal during the probationary period. Only when an employment relationship has existed for six months without interruption is one protected by the Dismissal Protection Act.

In exceptional cases, the termination may be discriminatory, unfaithful or immoral. However, the employer will usually not give a reason for termination in the case of a probationary period termination and does not have to do so.

In addition, formal errors or a lack of consultation of the works council can also render the termination invalid in the case of terminations during the probationary period.

There is no general answer to this question. A warning serves to reprimand and warn the employee in the event of misconduct.

In the case of serious misconduct (e.g. criminal offences), a warning is already sufficient to be able to effectively terminate the contract in the event of renewed misconduct.

In the case of lighter misconduct, several warnings are required. In this case, however, a dismissal can only be based on the previous warnings if the misconduct is the same in each case (e.g. regularly arriving late).

Termination agreement

In contrast to a unilateral termination, the employment relationship is terminated by mutual agreement through the conclusion of a termination agreement. This regularly has the advantage that the employment relationship is terminated more satisfactorily and without risk for both parties.

Pursuant to Section 623 of the German Civil Code (BGB), the termination of employment relationships by means of a termination agreement must also be agreed in writing (so-called written form requirement). A written termination agreement is intended to protect against a hasty decision, to serve as evidence for the courts in the process and to prevent a dispute as to whether a termination agreement has been concluded between employer and employee at all.

An employment relationship is terminated by mutual agreement through the conclusion of a termination agreement. Since the termination agreement is subject to the contractual freedom of both parties, they are largely free to formulate the content of the termination agreement. It is recommended that, in addition to the termination of the employment relationship as the main part of the termination agreement, other points (severance pay, remaining leave, employer's reference, etc.) for the proper termination of the employment contract be regulated at the same time. The range of possible regulations in a termination agreement is very wide and depends on the circumstances of the individual case. Tactical considerations should not be neglected.

It is advisable to use the services of a lawyer specialising in employment law in order to minimise the risk of a termination agreement that is disadvantageous for you.

There is no entitlement to the payment of severance pay. However, severance payments are often agreed. Especially if the employee has general protection against dismissal or a special right of termination (e.g. severe disability, pregnancy, works council membership, etc.).

In such cases, the employer cannot be sure whether a possible dismissal of the employee is effective and whether he will win the expected action for protection against dismissal. In order to avoid the risk of litigation and the possible back pay, employers offer severance pay as part of a termination agreement.

It is advisable here that the amount of severance pay is negotiated by a lawyer specialising in employment law in order to obtain the correct amount.

Blocking period for unemployment benefit means that no unemployment benefit can be drawn for a certain period of time. Unemployment benefit can only be drawn after this period has elapsed.

A blocking period for unemployment benefits does not apply if, among other things, there is an important reason. This is particularly the case if:

  • the prospect of dismissal by the employer has been raised,
  • the threatened employer's dismissal would be based on operational or personal (non-conduct-related) reasons,
  • the employer's notice of termination would have taken effect at the same time as the employment relationship ended or earlier;
  • in the event of termination by the employer, the notice period would be observed,
  • the employee was not ineligible for dismissal, and
  • a severance payment of up to 0.5 months' pay (gross) per year of employment is paid (still considered a significant economic advantage). The amount of the monthly salary is determined in accordance with Sec. 10 (3) KSchG. Accordingly, the employee is entitled to his or her entire salary with all components of the remuneration that he or she would have received in the regular manner. In addition to the regular salary, these also include bonuses, the value of benefits in kind, bonuses, gratuities and vacation pay. Benefits granted for longer periods are to be converted proportionately to the month.

 

Due to the conclusion of a termination agreement with severance payment, the Employment Agency only determines the occurrence of a blocking period for the receipt of unemployment benefits pursuant to Sec. 159 (1) No. 1 SGB III if the described requirements are not met.

In order not to receive a blocking period when drawing unemployment benefits, it is advisable to check the individual points in a termination agreement.

Contracts that have been concluded are to be adhered to in principle. Therefore, a termination agreement can only be "eliminated" retrospectively under certain conditions. In particular, the rescission of the termination agreement, the rescission and the disturbance of the basis of the contract can be considered.

The classic case of a rescission of the termination agreement is an unlawful threat by the employer to terminate the employment contract in the event of non-acceptance of the offer of termination. In addition, other grounds for rescission such as fraudulent misrepresentation, mistake as to content, mistake as to a material contractual characteristic may be considered.

If the employer defaults on the payment of the agreed severance payment, the employee may withdraw from the contract in accordance with Sections 323 et seq. BGB (German Civil Code), unless this right has been contractually excluded.

However, an employee's rescission of a termination agreement concluded with the employer due to non-payment of the agreed severance payment is excluded if the insolvency court has prohibited the employer from making such payments pursuant to section 21 InsO after the petition for commencement of insolvency proceedings has been filed.

Warning

In employment law, the principle of proportionality applies. It follows from this that dismissal should only take place if all other means are not expedient or have been exhausted. If an employee is to be dismissed because of a fact that he or she can control (e.g. misconduct), a warning is therefore required first. The warning has a reprimand function (designation of the objectionable behavior) and a warning function. In individual cases, however, a warning may be dispensable if the misconduct is serious.

An effective warning must contain the following:

  • Description of the specific breach of duty, stating the facts on which it is based.
  • Reference to the obligation to be complied with (e.g. obligation to start work at a certain time)
  • Reference to an imminent threat to the employment relationship in the event of repetition

 

The warning can be issued both in writing and orally and does not necessarily have to be literally referred to as a "warning". The employer himself or his authorised representatives are entitled to issue a warning.

By means of a warning, the employee's misconduct should be made clear to the employee, which is why it is advisable for the employer to determine the exact facts of the case. However, it is not legally necessary to hear the employee.

If you have received a warning, you should not rush to comment on the alleged facts. Consider whether the accusation is unjustified and, if necessary, secure evidence of this. If the accusation cannot be completely dismissed, a "face-saving" apology may be considered.

Once you have gained an overview of the situation, you can take action and have a counterstatement or objection included in the personnel file. A removal of the warning from the personnel file can be achieved within the framework of a labour court action.

If you are unsure whether and how to proceed against a warning, we will be happy to advise you.

Job reference

On the basis of § 630 BGB, § 109 GewO and § 16 BBiG, employees are entitled to a reference upon termination of employment. Job references are generally to be formulated in a benevolent manner, whereby the contents of the reference must correspond to the truth. However, the claim is not permanent. It is limited by limitation and preclusion periods and may be forfeited or, if necessary, impossible due to the employee's conduct.

Mistakenly, many assume that the employer must automatically prepare the certificate. This is wrong. The employer is not obliged to prepare a reference without being asked to do so. Only when the employee requests the reference is there an obligation to prepare it. It should also be noted that the employer does not have to send the reference to the employee. As a rule, the certificate is to be collected from the employer, unless the collection is associated with disproportionately high costs or extraordinary efforts.

If you do not receive a certificate despite being requested to do so, you can sue for the certificate to be issued.

A basic distinction is made between a simple and a qualified reference. An interim report may also be required under certain circumstances.

The simple certificate confirms the nature of the employment relationship, its duration and the individual areas of responsibility, but does not contain an evaluation of performance.

The qualified certificate also contains precise details of the activity performed and a description or assessment of performance throughout the period of employment.

Example of the content and formal structure of a qualified certificate:

  • Heading (reference / interim reference / training reference)
  • Data of the employee (name, date of commencement and termination of employment)
  • Representation of the employer
  • Job description
  • Performance appraisal (willingness to work, ability to work, success in work, method of working, concrete successes, leadership performance if applicable, overall assessment)
  • Behavioural assessment (assessment of social behaviour)
  • Closing formula
  • Signature / Place of issue / Date

It makes sense to first talk to the employer and try to find a satisfactory solution within the framework of a correction of the reference. The best basis for a discussion with the employer is a professional analysis of the reference. If no agreement can be reached with the employer, it is possible to enforce the desired changes in court. However, in this case a precise formulation must be demanded and the claim for correction of the reference must be presented conclusively. If one wants to achieve a better evaluation, one must explain and prove that the work performance was actually above average.

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