Dr. Mark Lembke, LL.M. (Cornell)
Rechtsanwalt und Fachanwalt für Arbeitsrecht
Attorney-at-Law (New York)
Dr. Pascal M. Ludwig
German Employment Law
Rechtsanwalt
GREENFORT
Arndtstr. 28
60325 Frankfurt am Main
Telephone: +49 69 979958 0
Telefax: +49 69 979958 10
E-mail: lembke@greenfort.de
E-mail: ludwig@greenfort.de
Web: www.greenfort.de
in a Nutshell
Tel Aviv, 7th July 2014
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I. German Labor & Employment Law - Overview
I. Einleitung
1. Legal Framework
The employment relationship may be subject to the following
regulations:
•
•
•
•
•
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European law
constitutional law
statutory law
collective bargaining agreements
works agreements
employment contract, occupational customs and practice, general
commitment
• principle of equal treatment
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I. German Labor & Employment Law - Overview
I. Einleitung
2. Main Statutes
Civil Code
(Bürgerliches Gesetzbuch)
Termination Protection Act
(Kündigungsschutzgesetz)
Anti Discrimination Act
(Allgemeines
Gleichbehandlungsgesetz)
Act on Collective
Bargaining Agreements
(Tarifvertragsgesetz)
Main
Statutes
Federal Vacation Act
(Bundesurlaubsgesetz)
Act on Part-Time and Fixed-Term
Contracts
(Teilzeit- und Befristungsgesetz)
Co-determination Act
(Mitbestimmungsgesetz)
One-third Participation Act
(Drittelbeteiligungsgesetz)
Works Constitution Act
(Betriebsverfassungsgesetz)
Continuation of
Remuneration Act
(Entgeltfortzahlungsgesetz)
Working Time Act
(Arbeitszeitgesetz)
Act on Temporary Agency Work
(Arbeitnehmerüberlassungsgesetz)
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II. Employment Contract
1. The Employment Contract
• Employment contract does not have to be in writing (some exceptions,
e.g., vocational trainees)
• Note: Termination Agreement requires written form!
• Act on information regarding conditions applicable (Nachweisgesetz)
• No language requirements, however, since the official language in
court is German, it is advisable to enter into a German language
contract or a bilingual version.
• Strict legal review of pre-formulated contract clauses by the courts
as to whether they comply with the "principle of good faith and fair
dealing"!
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II. Employment Contract
2. Fixed-term Employment Contract
Act on Part-Time and Fixed-Term Contracts
(Teilzeit- und Befristungsgesetz)
With justifying reasons,
e.g.:
• Temporary need for
additional workforce
• Temporary employment
following a traineeship
or university studies
• Temporary replacement
of another employee
(e.g., sickness, parental
leave)
• Temporary employment
for a specific project
Without justifying reasons:
• No prior employment
relationship between the
parties (in the last three
years)
• Time limit: two years
• During said period
extendable for three times
• Breach of these
requirements or written
form requirement results
in the contract being
deemed to be entered into
for an unlimited period.
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III. Terms and Conditions of Employment
1. Remuneration
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New: General statutory minimum wage (€ 8.50/hour) from 1 January 2015 on.
Remuneration is agreed in the individual employment contract or determined by the
applicable collective bargaining agreements.
Strict case law regarding bonus clauses!
A clause in the employment contract which deems overtime to be compensated by the
employee's base salary is principally invalid.
2. Sick Pay
•
After four weeks of employment, the employee is entitled to continued pay of remuneration
for a six-week period in the amount of 100% of the employee's regular salary when
unable to work due to illness
3. Working time
•
•
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Eight hours/day; increase to ten hours/day possible (but only if average of 48 hours/week
is not exceeded)
Work on Sundays/public holidays is principally not allowed.
Minimum rest periods per working day:
• 30 minutes (working time between six and nine hours)
• 45 minutes (working time more than nine hours)
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III. Terms and Conditions of Employment
4. Vacation
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Statutory minimum vacation entitlement: 24 work days (= Monday through Saturday) per
calendar year based on a six day working week, i.e. four weeks.
German practice: up to 30 working days per calendar year based on a five day working
week
Vacation entitlement must be taken in the respective calendar year; otherwise forfeiture (in
principle).
Exception: transfer of vacation days; have to be taken within the first three months of the
following calendar year.
Payment of untaken vacation only in case of termination
5. Notice periods
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German statutory law provides for notice periods ranging between four weeks and seven
months, depending on the employee's years of service with the employer.
For a probationary period of up to six months, the parties may agree on a notice period of
two weeks.
Individual contracts may provide for longer notice periods.
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IV. Termination of Employment
1. General Options re. Termination
Employment Contract
Unlimited term
Notice of termination
Termination
for important
reason
Fixed term
Termination
agreement
Ordinary notice
of termination
Ordinary notice only if
agreed upon in
contract/ termination
for important reason
possible
Expiry of term
Termination
agreement
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IV. Termination of Employment
2. The Termination Protection Act
• Under the Termination Protection Act (Kündigungsschutzgesetz), a
termination is invalid, unless it is socially justified
• The Termination Protection Act applies if:
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
the company employs more than ten employees in the establishment, and
the employee to be dismissed has been employed with the company for more than
six months ("waiting period")
• Termination can be socially justified upon three grounds:
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personal capability (personenbedingte Kündigung)
conduct (verhaltensbedingte Kündigung)
urgent operational reasons (betriebsbedingte Kündigung)
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V. Employee Representation
1. Works Council
• Main employee representation body, elected by employees
• May (not: must!) be established where the employer employs five
employees in an establishment (Betrieb)
• One works council in each establishment
• Information and co-determination rights
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V. Employee Representation
2. Rights of the Works Council
• Information rights: Works council is entitled to be informed by
employer, but execution of measure by employer cannot be prevented
Examples:
 workflow, work environment, technical equipment
 information of economic comittee about economic matters
• Consultation rights: Works council is entitled to actively argue with
employer about specific measures to be carried out in the future
Examples:
 Personnel planning
 Proposals on security of employment
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V. Employee Representation
2. Rights of the Works Council
• Veto right: Works council can veto for specific reasons
Examples:
–
Assignment of a workplace to employee, transfer to another workplace
• Co-determination rights: Works council's positive consent is required.
It is normally given in a works agreement.
Examples:
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Social matters enlisted in Works Constitution Act (e.g., matters in respect of working
time, overtime, introduction or use of IT which is suitable to control employee conduct)
Social plan in case of major restructuring measures
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Dr. Mark Lembke, LL.M. (Cornell)
Rechtsanwalt und Fachanwalt für Arbeitsrecht
Attorney-at-Law (New York)
Dr. Pascal M. Ludwig
Thank you
for your attention!
Rechtsanwalt
GREENFORT
Arndtstr. 28
60325 Frankfurt am Main
Telephone: +49 69 979958 0
Telefax: +49 69 979958 10
E-mail: lembke@greenfort.de
E-mail: ludwig@greenfort.de
Web: www.greenfort.de
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