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German Labor & Employment Law Dictionary

Company Practice, Established back
In case of an established company practice (betriebliche Übung), the employer has acted in a certain manner for a considerable period of time allowing the employee to rely on the employer continuing this practice.  The practice of the employer is regarded an offer to alter the conditions of employment.  For example, payment of Christmas benefits for three consecutive years is regularly regarded an established practice granting a contractual claim for the future.  Also, a continued application of a collective bargaining agreement may lead to its application even for non-union members.  According to recent case law by the Federal Labor Court (Bundesarbeitsgericht), a so-called "double written form clause" is suitable to avoid the establishment of a company practice.  A "double written form clause" is a clause which provides that any amendment or side agreement needs to be in writing in order to be effective, including an amendment of the written form requirement itself.

Dissolution of Employment,  Motion for back
In exceptional cases, the labor courts may allow a so-called motion for dissolution of employment Auflösungsantrag), thereby terminating the employment relationship against payment of a severance despite the fact that the employee has prevailed in the unfair dismissal proceedings.  In case of an employee motion, the employee must submit that he cannot reasonably be expected to remain in office. In case of an employer motion, the employer must submit that it is unlikely that the employee remaining in office allow a mutual cooperation which would be beneficial to business interests.  In case of an executive, the employer motion does not require a reason.

Employee, Non-Terminable back
A non-terminable employee (unkündbarer Arbeitnehmer) cannot be dismissed with notice due to a contractual restriction.  In most cases, the contractual restriction is stipulated in a collective bargaining agreement and requires the employee to attain a certain age.  The right of the employer to terminate for cause remains unaffected by such restriction.

Executive back
As regards the term "executive" (leitender Angestellter),  one must distinguish between the Works Council Constitution Act (Betriebsverfassungsgesetz) and the Unfair Dismissal Act (Kündigungsschutzgesetz).

Executive pursuant to the Works Council Constitution Act means a person, who, by virtue of their employment agreement and actual status in the company or works, regularly assumes duties that are of importance for the existence and development of the company or works, if the performance of such duties requires particular experience or skills, subject to the condition that the person essentially decides free of instructions or definitely influences such decisions.

Executive pursuant to the Unfair Dismissal Act means a person who (apart from managing directors, officers and the like) has independent authority to hire and fire.

Severance Payment
Payment by the employer on the occasion of the termination of an employment relationship.  Despite a common misconception, German law does not provide for a general statutory severance claim, not even in case of unfair dismissal.  The only option the dismissed employee has is to challenge the termination by filing an unfair dismissal lawsuit (Kuendigungsschutzklage).  In this situation, it happens quite often that the employer offers a severance in order to avoid that the dismissed employee comes back to work.  In addition, severance claims may arise from a motion for dissolution of employment (Auflösungsantrag), from a social plan (Sozialplan), from a collective bargaining agreement (Tarifvertrag) or as disadvantage compensation (Nachteilsausgleich).

Unemployment Benefits back
Benefits granted by the labor authorities in case of unemployment for a certain perioed of time upon loss of job, but after at least 12 months of membership in the statutory and mandatory unemployment insurance fund (unemployment benefits type I).  Upon expiration of unemployment benefits type I, the employee will be entitled to lower payments which are not supposed to exceed what is required to make ends meet (unemployment benefits type II).

Warning Letter back
Formal request that the employee ceases with a certain type of misconduct in the future.  In most cases, the employer is required to issue a warning letter, before terminating for misconduct or for cause.  In order to be valid, the warning letter must specify the miconduct, give instructions what is expected and threaten legal steps in case of a repeated misconduct.  If the warning letter is unjustified, it must be removed from the HR files at the employee's request.

Works Council back
A works council (Betriebsrat) is a body elected by the workforce and has certain participation rights, such as rights to be heard and co-determination rights.  In many cases, an orderly participation of the works council is a condition for the effectiveness of measures taken by the employer.  The works council and the employer may conclude works agreements with immediate application for each employment relationship.  One must distinguish between compellable works agreements and voluntary works agreements.  Members of the works council enjoy special protection against dismissal.

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