News - Germany

Germany - February 2012

Redundancy, selection and age discrimination

When selecting employees for redundancy selection a difference in treatment due to age may be justified by a legitimate aim.

According to the Protection from Unfair Dismissal Act (“KSchG”), employers have to consider social criteria, such as seniority, age, obligations to support a spouse and children and disabilities when it comes to redundancies due to operational reasons (“social selection”). The ‘age’ criterion is designed to protect older employees when it comes to dismissals.

According to the KSchG the social selection may also be made amongst age groups e.g. employees from 21 to 30 years, 31 to 40 years etc. in order to ensure a balanced age range.  This results in age only being important within the respective group.  This can be used to ensure that the employees’ age range remains mostly unchanged.

While the social selection does not contravene the European Union’s prohibition on age discrimination it does, however, lead to a different treatment due to age.  This different treatment may be objectively and reasonably justified by a legitimate aim.  A legitimate aim includes employment policies and labour market, if the means of achieving the aim are appropriate and necessary.

A claim brought by an employee for protection from unfair dismissal, in which he challenged the formation and the customisation of age groups in an employer and workers’ council selection guideline, has accordingly been dismissed by the Federal Labour Court.

A request for a preliminary ruling from the Court of Justice of the European Union was not thought to be necessary as the EU’s legal position is sufficiently clear following several recent decisions of the European Court of Justice.

Resources

German Federal Labour Court, judgment dated 15 December 2011 - 2 AZR 42/10

German Feder Labour Court

For further information or to discuss any of the issues raised, please contact Stefanie Andrelang on +49 89 242230-0.