supply of temporary workers in Germany
is permissible only if the company, which
supplies temporary workers against payment
of a fee, has an official permission from
the competent authority. The aim of this
new legislation is to protect the working
conditions encountered by temporary
workers. Since January 1, 2018, companies
leasing temporary workers have to ensure
that, as of the first day of service, the
temporary workers benefit from the same
working conditions and pay as the employers'
permanent staff. In addition, no temporary
worker may be leased for a period exceeding
18 months. Due to the new provisions,
leasing workers has become less attractive
in Germany, which is the reason why some
companies have already started seeking
alternative solutions.
Against Dismissal
Dismissal Act (Kündigungsschutzgesetz), the
reasons for employers in Germany to give
notice of dismissal are restricted. This Act is
applicable in enterprises having more than
10 employees, who have been employed with
the employer for no less than a six-month
period.
Under the German Protection Against
Unfair Dismissal Act, any dismissal by an
employer must be justified by a good reason.
These include reasons relating to:
disability due to a long-term illness of an
employee).
important reasons, so-called extraordinary
dismissals. An extraordinary dismissal is
possible whenever there is a reason that
makes it unacceptable for the employer to
continue the employee's employment until
expiry of the notice period for termination.
Except in case of an extraordinary
dismissal, any dismissal by an employer
is subject to the statutory or contractually
agreed notice periods. The statutory notice
periods vary from four weeks to seven
months depending on how long the employee
notice period, the employee stays on the
payroll and must be employed, unless he or
she is placed on leave.
Prior to giving notice of dismissal, the
works council (see item six) must be heard.
However, the works council cannot prevent
a dismissal. Any notice of dismissal must
be sent to the employee in written form and
must be signed by a person authorized to
represent the company.
In Germany, employees can go to court
requesting that the dismissal be declared
invalid. In order to do so, the employee
must bring an action in the competent labor
court on grounds of unfair dismissal within
three weeks after receipt of the notice of
dismissal. In many cases, it will be difficult
for the employer to provide a reason able
to satisfy the labor court that the dismissal
was valid. Therefore, although there is no
statutory entitlement to receive severance
pay, the employer and the employee often
agree to terminate the employment by
mutual consent with severance pay going
to the employee. For calculating severance
pay, the following formula is usually used:
service x factor = severance pay
skills of the parties to the employment
contract and the risks involved in a legal
action and usually is between 0.5 and 1.5.
more employees can elect a works council
to represent the employees' interests in
dealings with the employer. However,
there is no legal obligation to do so.
As a consequence, there are numerous
companies in Germany that have no works
council.
An employer must involve the works
council in a variety of decisions, e.g.,
when the employer intends to terminate an
employment relationship (see item five).
There are also matters where the employer
must inform or involve the works council.
Regulating operating procedures in matters
that are of particular relevance to the
employees requires a real consent of the
works council. In such cases, the employer
cannot act without the consent of the works
council, so-called co-determination. The
subject to co-determination of the works
council:
employees at work (e.g., smoking ban,
dress code);
working time (e.g., duty rosters);
working time (e.g., overtime or short-
time work orders);
equipment (includes virtually all IT-
systems); and
(structuring of a profit-related bonus
scheme).
the works council in various other matters,
like relocating or recruiting employees
or changing the operational organization
if a change can entail disadvantages for
employees, e.g., in case of closing or
merging businesses or parts of businesses.
provisions of the General Data Protection
Regulation will introduce some changes to
employee data protection in Germany as
of May 25, 2018.
Although the implementation of an
employment relationship will continue
to justify the collection and processing
of the employee's personal data, changes
will probably occur with respect to the
(secret) monitoring of employees, who are
suspected of having committed a criminal
offense or severe breach of duty against
the employer.
Due to the uniform level of protection
granted by the new regulation, the transfer
of data within a group of companies will
become considerably easier within the
EU member states. However, no easy and
practicable solutions for data transfers
to the United States, for instance, are
currently available as even the EU-U.S.
Privacy Shield continues to be exposed to
comprehensible legality concerns within
the EU.