Labor & Employment Law Dictionary
Company Practice, Established
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
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
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
In case of an employee motion, the employee must submit that
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.
non-terminable employee (unkündbarer
Arbeitnehmer) cannot be dismissed with notice
due to a contractual restriction. In most cases, the
restriction is stipulated in a collective bargaining agreement and
requires the employee to attain a certain age. The right of
employer to terminate for
cause remains unaffected by such restriction.
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
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
Severance Payment back
employer on the occasion of the termination
of an employment
relationship. Despite a common misconception, German law does
provide for a general statutory severance claim, not even in case of
unfair dismissal. The only option the dismissed employee has
to challenge the termination by filing an unfair dismissal lawsuit
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
bargaining agreement (Tarifvertrag)
or as disadvantage
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
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.
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
condition for the effectiveness of measures taken by the employer.
The works council and the employer may conclude works
with immediate application for each employment relationship.
must distinguish between compellable works agreements and voluntary
works agreements. Members of the works council enjoy special
protection against dismissal.