Termination

Contents:

1.) General Questions
2.) Termination According to BGB
3.) Termination According to KSchG

4.) Letter of Recommendation
     a.) Phrasing on Performance
     b.) Phrasing on Work Habits
     c.) Phrasing on Conduct
     d.) Structure of Contents
5.) Relevant Checklists

1.) General Questions

At home, I know that bosses can hire and fire as they like. What is it like in Germany? When can employers terminate an employment?

The slogan “hire and fire” does not apply to German law. In fact, it would be safer to say that employers are subject to “Hire and hooked”.
§

After signing a contract five months and three weeks ago, I received a termination from my company that my position is canceled in one week. Huh? What’s going on? My boss mumbled something about probation time. I thought I was on for good.

Well, you either did not read, or understand your contract. You seem to be on a probationary period. According to §622 III BGB. Sure. Your termination is subject to the same rules as your employer is. The rule states that the probation period may last at most 6 months, the period of notification must be at least two weeks and the cancellation letter in writing. An electronic dismissal is invalid (§623 BGB)! It must be in writing.
§

I just was just fired from my job. I do not want to accept it unless I must. How can I test the legality of the termination?

To test a notice of termination, the first thing you have to do is check out, if your case falls under the Law on Protection against Terminations (Kündigungsschutzgesetz). If so, that will rule in your case. If your case will not fall under this law then the general rules of the Civil Code will govern.
§§

My boss sent me a letter in German. He knows that my command of German is very limited. After asking the help of some friends, I found out that it was a pink slip. Is this valid?

If you only know and understand the one word “Kündigung”, you got the letters point. If you want to fight against this notice get in contact with the attorney of your trust – ASAP. You are required to sue your employer within three weeks following the receipt of a termination letter. ..
§§§

I often have talked rudely in public about my company. I called them “a bunch of nincompoops, thieves, and murderers”. Now they fired me without prior notice. Was that legal?

The grounds you mentioned surely justify firing without prior notice. The only question is whether they obeyed the formal requirements. Your boss has to give notice in writing (at the moment, it is unclear whether a fax is sufficient). It is not sufficient to fire somebody orally.
§

My boss dismissed me last week for absolutely ridiculous reasons. I want to sue him to take me back. If I win, who will have to pay the attorney’s fees?

It does not matter who wins. You must pay your own attorney (§12a ArbGG). That relates only to the first instance. Ask your attorney before hiring him how high his bill will be. By law, he has to tell you what he will charge.
§

I just gave birth to my daughter in a town in Hesse. As a proud Muslim, I started wearing a headscarf not only at home but also in the department store where I work. My boss fired me on so-called person-related grounds. I have worked for him for ten long years, and now he tells me he is afraid that my scarf will turn off his customers!

Good news! The Bundearbeitsgericht (Federal Labor Court) has ruled against an employer in a similar case (October 10, 2002 re 2 ARZ 472/01). There are two sides to this issue. Generally, employers have the right to set dress rules for their workers. He has certain business freedoms anchored in the German constitution. Just the same, your boss has to consider your constitutional right to your religious beliefs. Balancing the rights of the store and the worker, the court found that the store’s potential economic loss must yield to your religious rights. Specifically, the court said the store has to wait and see whether your headscarf really does annoy his customers. Even if it does, the store has to offer you alternative employment (for instance, by transferring you to another department where you can use your qualifications and wear your scarf).........
§§

Hey, I just got fired! Will I loose my health and pension insurance now?

No! By no means!! You are talking of legal relationships exclusively between you and the relevant (public / private) insurance. Your employer is by law obligated to share half of your social securtiy premiums. When you receive unemployment benefits, the labor office will pay for them – even though a significantly reduced rate. No, you will not be obligated to pay the difference. This shows the importance of private old-age security once again. The only thing you might loose could be a direkt insurance by your employer.
§

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2.) Termination According to BGB

How much notice does an employer have to give?

It depends on how long the employee has worked for him or her:

2 years: one month to the last day of a month,

5 years: two months to the last day of a month,

8 years: four months to the last day of a month,

12 years: five months to the last day of a month,

15 years: six months to the last day of a month,

20 years: seven months to the last day of a month.
§

I am sick and tired of working for this guy who hired me. I want to quit. How long is the period of notification?

You have to give the employer 4 weeks to end on the 15th or to the end of the month (§622 I BGB). Be aware that oral notification is not valid, so you must give notice in writing (§623 BGB). If you fail to give notice in writing, you are required to keep working and your boss will not have to pay you for the time you stayed home!
§

3.) Termination According to Kündigungsschutzgesetz

When is this law applicable?

This law is applicable for all employers having at least 10 fulltime employees (§23 KSchG). Since this law changed to January 1^st 2004, you have to know if you fall under the old or new rules. The old rules remain valid for you if you were already employed on December 31, 2003. The old rules are basically the same as the new ones, however only for employers having up to 5 employees. This means that you are protected against termination if your boss had 6 or more employed persons in December 2003. Contact your attorney to determine the correct applicable law.
§§§

What are the rules for a dismissal following the Kündigungsschutzgesetz?

The boss can only give notification, if firing is “socially justified” (§1 KSchG). The Kündigungsschutzgesetz (Unfair Dismissal Act) applies to all private or public companies with more then ten fulltime employees.
§§§

Who counts as a fulltime employee?

Employees who are working for at least six months in the same firm. Apprentices do not count as employees. Part-time workers count ½ if they work up to 20 hours a week, and ¾ for up to 30 hours. This statute also requires a balancing of the employer’s and employee’s interests (tending to favor the employee). There are operational, person-related and conduct-related reasons for dismissal, also to be met (§622 III BGB).
§

When can an employer bring forward operational reasons to dismiss any employees?

Operation reasons apply when a special position is abolished, further employment in another position is not available, and the “Sozialauswahl” (social selection) fell on you. The employer must give detailed reasons on why all three grounds implicate a particular employee. Details depend on whether the operational reasons are either “internal” or “external”.
§§§

What is meant by “internal operational reasons” for dismissal?

If your boss wants to fire you for internal reasons then he must prove that

he made a genuine operational decision, and described the contents of his decision in detail,
he really implemented that decision,
he showed the potential impact of his decision on the need to keep the employee (by the time notice takes effect),
his decision affected only the workers directly linked to the positions he eliminated.
§§§

What is meant by “external operational reasons” for dismissal?

If the boss wants to fire you for external reasons, he must meet the following conditions:

Your employer must be able to prove that the alleged external reasons really exist to the extent he alleges.
The external reasons must have direct and unavoidable impact on the need to keep the affected employee.
Only the employees whose jobs are directly affected by the alleged external reasons get dismissed.
§§§

Are there any exceptions to the Sozialauswahl?

The change in the law in 2004 allows the possibility of keeping certain persons out of social evaluation (§1 III 2 KSchG): special knowledge, special abilities or employees important for balanced personnel structure and personnel structure represents a just operational interest.
§§§

When is a dismissal socially unjustified?

In balancing the interests of worker and firm, it is vital to look at workers whose jobs are similar and who occupy similar jobs in the hierarchy of the firm. The criteria here include

length of employment in the company,
one’s age,
child (and other dependants) support,
health (including disabilities),
marital status,
job prospects

In other words, the employer must present compelling reasons for dismissing a particular employee and not someone else, who needs the job more. Of course, he has some discretion. The rules on social justification take second place at times, as long as the employer can show compelling reasons in the realms of operations, economics, and other justifiable concerns. With the change of the law in 2004, there is also the possibility to keep certain persons out of social evaluation (die Sozialwahl nach §1 III 2 KSchG): if you have special knowledge, abilities or if you are important for a balanced personnel structure, then this can represent a just operational interest.
§§§

What are person-related grounds for firing?

Person-related grounds allege the objective inability to fill your position. They cover for example: constant or frequent illness leaves, loss of state license, lost physical ability due to an accident. This reason for dismissal may only be used as an ultima ratio. Three considerations are necessary:

At the point of time when notice is given, the facts must justify serious concerns that the employee will not be able to do his job in the future.
The prognosis according to 1.) must allow the employer to conclude that considerable disturbances of the operational process will occur, or, that he will have to pay a considerable amount of money due to the inability of the employee to do his job.
Dismissal must pass the balance of interests of the employer and employee. For instance, let’s say a worker has failed to renew his job permit, or the relevant office has not yet made a decision on his permit and no one knows how long the decision will take. In this case, the employer’s interests may override those of the worker.
§§§

What are conduct-related reasons for dismissing?

Neither the courts nor the legal experts have come up with perfect criteria for this procedure. As a rule of thumb, we can say only that there are conduct-related grounds for dismissal if an employee has done something truly worthy of blame (e.g. theft of company property).
§§§

I just was given a dismissal with the option of altered conditions of employment. Do I have to give into this?

In general, no. This form of dismissal is unlike others in that it follows the bosses contention that “I do not need this worker in that job anymore, but I have other positions he could fill. So I want to shift him from A to B.” If you get a notice like this, you have 3 weeks to accept the notice with or without reservation. (Getting specific: the reservation can only be that the dismissal is not “socially justified.”) Be careful: if you decline to accept the “altered conditions of employment,” your notice will be considered final. But don’t give up now! You can still contest this final notice in court within 3 weeks of your decision (§4 KSchG). As for procedural questions, see the next question.
§§§

My boss fired me one month ago. What can I do about it?

Virtually nothing. The law allows you to file a court case within three weeks of dismissal (§4 KSchG). You can get only an extension if some problem prevents you from filing on time despite your best efforts. You will have to file within 2 weeks after solving your problem and within 6 months after the first 3-week deadline. If your head is spinning with numbers, here’s an example. If you were fired on January 15, the first deadline comes on February 5. The very last chance for filing exceptionally will be on June 15.
§

As I have noticed for some time, my boss has been reorganizing the company by changing job descriptions and even firing people. Now it has got me. My boss is offering me a dismissal pay. How am I to understand that?

Just simply understand that your boss cannot use you in his company anymore and wants “to treat” you to leave. Usually you have no right to demand a severance pay. Do not understand “pay” too literally; it can be either in money or in goods. If you do not have a job to go to immediately following this position, there are some catches, see on page 197, for becoming unemployed and receiving benefits from labor agency. Get consultation from an attorney of your trust. These rules are pretty tricky.
§§§

When can I claim a severance payment?

Generally, you do not have the right to demand a dismissal pay just because you lose your job. The exceptions to this rule are

instead of suing (or continuing the lawsuit against) your employer for unfair dismissal and claiming your job back, you agree to leave if you receive a severance payment.
if the employer has disclosed that he terminated you for redundancy and if he has offered you severance pay for letting the three weeks deadline expire, then you will be entitled to the severance payment as soon as the three weeks have passed (§1a KSchG).
in case of operational changes and mass redundancies above a certain threshold, the works council is allowed to negotiate a so-called Sozialplan (social plan) with the employer. In such case, you may claim a severance pay under the social plan.
if your employer ignores the requirement to negotiate the “if” and “how” of a on operational change/mass dismissal with the works council (so-called Interessenausgleich / reconciliation of interests), you may sue your employer for a severance payment in form of the so-called Nachteilsausgleich (compensation for disadvantages).
some collective labor agreements provide for severance payments (e.g. so-called Rationalisierungsschutzabkommen / restructuring avoidance treaties).
if the dismissal was unfair, and it cannot reasonably be expected for you to continue, the court will, upon your petition, dissolve the employment relationship and award you a severance payment.
if the dismissal was unfair, but it is unlikely that a continued working relationship would serve the business interests of your employer, the court will, upon your employer’s petition, dissolve the employment relationship and award a severance payment.
§§§

4.) Letter of Recommendation

I am getting things together for my new job and I am curious about what a reference letter looks like.

Oh, this is just a piece of paper with a lot of ink on it showing a bunch of funny figures. No, just kidding. This is a report on your performance as an employee. It is usually written on the company’s letterhead and to be personally signed by the employer using document proof ink (§109 III GewO). If it is folded, then the folds are not to be seen on copies.
§

How am I supposed to read in this reference letter? What is in the contents?

This letter shows what kind of employee you were – without explicitly saying anything bad about you. There are two kinds of certificates: the “simple” and the “comprehensive”. All certificates must contain the employee details: (first, middle, maiden, last name, academic title, address, birth date and birth place) and the company details (name and address), letterhead requirements.
§

The simple certificate contains furthermore an explicit and exact job description, as well as duration of employment. The reason why the job ended is required only upon demand of the employee.

The qualified reference also contains an evaluation on your performance and conduct. Generally, the wording is in discretion of the employer, however he is restricted to using formal customs that include certain (typically polite) phrases which have implicit certain meanings. Over the years, a certain code has been developed.

At the end of a reference letter, it is customary to express one’s regret that the employee is leaving, to thank the employee for the services rendered and to wish the employee all the best for his future endeavors. However, such final phrase is not required.

Reference Letter: Phrasing Overview on Performance

„stets (jederzeit, immer) zu unserer vollsten Zufriedenheit“	excellent performance
„stets zu unserer vollen Zufriedenheit“	good performance
„stets zu unserer Zufriedenheit“ or „zu unserer vollen Zufriedenheit“	sufficient or good average performance
„zu unserer Zufriedenheit“	a still average performance
„hat sich bemüht“	insufficient or poor performance

Reference Letter: Phrasing on Working Habits

“mit äußerster Sorgfalt und großer Genauigkeit“	excellent
„mit großer Sorgfalt und Genauigkeit“	good
„mit Sorgfalt und Genauigkeit“	satisfactory
wordings below this standard are either	average or poor

Reference Letter: Description of Conduct

Working success and working manner will usually be worded that execution of given tasks were

„sein Verhalten gegenüber Vorgesetzten und Mitarbeitern war stets einnwandfrei / vorbildlich“	“his behavior vis-à-vis superiors and colleagues was always impeccable / exemplary” (excellent)
„sein Verhalten gegenüber Vorgesetzten und Mitarbeitern war einnwandfrei / vorbildlich“	“his behavior vis-à-vis superiors and colleagues was impeccable/exemplary” (good)
„sein Verhalten war gut“	his behavior was good” (satisfactory)
„stets befriedigend“	"always satisfactory" (average)

Reference Letter: Structure of Contents

Following structure is common:

employer’s letterhead,
title (final or interim report),
introduction (personal data of employee),
duration of employment (apprenticeship times, longer interrupts),
description of position (employee’s duties and rights, place in hierarchy), career development,
performance description, (evaluation of performance / ability / willingness / success or expectation of employer, summary),
evaluation of leadership (for superiors),
description of conduct,
termination modalities (left upon his will/after completion of project),
regards,
signer (place, date, signature).

5.) Relevant Checklists

The checklists below are not just a repetition of any table above but they also cover further hints to help you make the right decision if it is worth the trouble to consult an attorney to represent your interests.

Authors: AvE / FS

Termination

1.) General Questions

At home, I know that bosses can hire and fire as they like. What is it like in Germany? When can employers terminate an employment?

The slogan “hire and fire” does not apply to German law. In fact, it would be safer to say that employers are subject to “Hire and hooked”. §

After signing a contract five months and three weeks ago, I received a termination from my company that my position is canceled in one week. Huh? What’s going on? My boss mumbled something about probation time. I thought I was on for good.

I just was just fired from my job. I do not want to accept it unless I must. How can I test the legality of the termination?

My boss sent me a letter in German. He knows that my command of German is very limited. After asking the help of some friends, I found out that it was a pink slip. Is this valid?

I often have talked rudely in public about my company. I called them “a bunch of nincompoops, thieves, and murderers”. Now they fired me without prior notice. Was that legal?

The grounds you mentioned surely justify firing without prior notice. The only question is whether they obeyed the formal requirements. Your boss has to give notice in writing (at the moment, it is unclear whether a fax is sufficient). It is not sufficient to fire somebody orally. §

My boss dismissed me last week for absolutely ridiculous reasons. I want to sue him to take me back. If I win, who will have to pay the attorney’s fees?

It does not matter who wins. You must pay your own attorney (§12a ArbGG). That relates only to the first instance. Ask your attorney before hiring him how high his bill will be. By law, he has to tell you what he will charge. §

Hey, I just got fired! Will I loose my health and pension insurance now?

2.) Termination According to BGB

How much notice does an employer have to give?

It depends on how long the employee has worked for him or her:

I am sick and tired of working for this guy who hired me. I want to quit. How long is the period of notification?

3.) Termination According to Kündigungsschutzgesetz

When is this law applicable?

What are the rules for a dismissal following the Kündigungsschutzgesetz?

The boss can only give notification, if firing is “socially justified” (§1 KSchG). The Kündigungsschutzgesetz (Unfair Dismissal Act) applies to all private or public companies with more then ten fulltime employees. §§§

Who counts as a fulltime employee?

When can an employer bring forward operational reasons to dismiss any employees?

What is meant by “internal operational reasons” for dismissal?

If your boss wants to fire you for internal reasons then he must prove that

he made a genuine operational decision, and described the contents of his decision in detail,

he really implemented that decision,

he showed the potential impact of his decision on the need to keep the employee (by the time notice takes effect),

his decision affected only the workers directly linked to the positions he eliminated. §§§

What is meant by “external operational reasons” for dismissal?

If the boss wants to fire you for external reasons, he must meet the following conditions:

Your employer must be able to prove that the alleged external reasons really exist to the extent he alleges.

The external reasons must have direct and unavoidable impact on the need to keep the affected employee.

Only the employees whose jobs are directly affected by the alleged external reasons get dismissed. §§§

Are there any exceptions to the Sozialauswahl?

The change in the law in 2004 allows the possibility of keeping certain persons out of social evaluation (§1 III 2 KSchG): special knowledge, special abilities or employees important for balanced personnel structure and personnel structure represents a just operational interest. §§§

When is a dismissal socially unjustified?

In balancing the interests of worker and firm, it is vital to look at workers whose jobs are similar and who occupy similar jobs in the hierarchy of the firm. The criteria here include

length of employment in the company,

one’s age,

child (and other dependants) support,

health (including disabilities),

marital status,

job prospects

What are person-related grounds for firing?

At the point of time when notice is given, the facts must justify serious concerns that the employee will not be able to do his job in the future.

The prognosis according to 1.) must allow the employer to conclude that considerable disturbances of the operational process will occur, or, that he will have to pay a considerable amount of money due to the inability of the employee to do his job.

What are conduct-related reasons for dismissing?

Neither the courts nor the legal experts have come up with perfect criteria for this procedure. As a rule of thumb, we can say only that there are conduct-related grounds for dismissal if an employee has done something truly worthy of blame (e.g. theft of company property). §§§

I just was given a dismissal with the option of altered conditions of employment. Do I have to give into this?

My boss fired me one month ago. What can I do about it?

As I have noticed for some time, my boss has been reorganizing the company by changing job descriptions and even firing people. Now it has got me. My boss is offering me a dismissal pay. How am I to understand that?

When can I claim a severance payment?

Generally, you do not have the right to demand a dismissal pay just because you lose your job. The exceptions to this rule are

instead of suing (or continuing the lawsuit against) your employer for unfair dismissal and claiming your job back, you agree to leave if you receive a severance payment.

if the employer has disclosed that he terminated you for redundancy and if he has offered you severance pay for letting the three weeks deadline expire, then you will be entitled to the severance payment as soon as the three weeks have passed (§1a KSchG).

in case of operational changes and mass redundancies above a certain threshold, the works council is allowed to negotiate a so-called Sozialplan (social plan) with the employer. In such case, you may claim a severance pay under the social plan.

some collective labor agreements provide for severance payments (e.g. so-called Rationalisierungsschutzabkommen / restructuring avoidance treaties).

if the dismissal was unfair, and it cannot reasonably be expected for you to continue, the court will, upon your petition, dissolve the employment relationship and award you a severance payment.

if the dismissal was unfair, but it is unlikely that a continued working relationship would serve the business interests of your employer, the court will, upon your employer’s petition, dissolve the employment relationship and award a severance payment. §§§

4.) Letter of Recommendation

I am getting things together for my new job and I am curious about what a reference letter looks like.

How am I supposed to read in this reference letter? What is in the contents?

The simple certificate contains furthermore an explicit and exact job description, as well as duration of employment. The reason why the job ended is required only upon demand of the employee.

At the end of a reference letter, it is customary to express one’s regret that the employee is leaving, to thank the employee for the services rendered and to wish the employee all the best for his future endeavors. However, such final phrase is not required.

Reference Letter: Phrasing Overview on Performance

Reference Letter: Phrasing on Working Habits

Reference Letter: Description of Conduct

Reference Letter: Structure of Contents

Following structure is common:

employer’s letterhead,

title (final or interim report),

introduction (personal data of employee),

duration of employment (apprenticeship times, longer interrupts),

description of position (employee’s duties and rights, place in hierarchy), career development,

performance description, (evaluation of performance / ability / willingness / success or expectation of employer, summary),

evaluation of leadership (for superiors),

description of conduct,

termination modalities (left upon his will/after completion of project),

regards,

signer (place, date, signature).

The slogan “hire and fire” does not apply to German law. In fact, it would be safer to say that employers are subject to “Hire and hooked”.
§

The grounds you mentioned surely justify firing without prior notice. The only question is whether they obeyed the formal requirements. Your boss has to give notice in writing (at the moment, it is unclear whether a fax is sufficient). It is not sufficient to fire somebody orally.
§

It does not matter who wins. You must pay your own attorney (§12a ArbGG). That relates only to the first instance. Ask your attorney before hiring him how high his bill will be. By law, he has to tell you what he will charge.
§

The boss can only give notification, if firing is “socially justified” (§1 KSchG). The Kündigungsschutzgesetz (Unfair Dismissal Act) applies to all private or public companies with more then ten fulltime employees.
§§§

his decision affected only the workers directly linked to the positions he eliminated.
§§§

Only the employees whose jobs are directly affected by the alleged external reasons get dismissed.
§§§

The change in the law in 2004 allows the possibility of keeping certain persons out of social evaluation (§1 III 2 KSchG): special knowledge, special abilities or employees important for balanced personnel structure and personnel structure represents a just operational interest.
§§§

Neither the courts nor the legal experts have come up with perfect criteria for this procedure. As a rule of thumb, we can say only that there are conduct-related grounds for dismissal if an employee has done something truly worthy of blame (e.g. theft of company property).
§§§

if the dismissal was unfair, but it is unlikely that a continued working relationship would serve the business interests of your employer, the court will, upon your employer’s petition, dissolve the employment relationship and award a severance payment.
§§§