News - Germany

Germany - September 2013

Temporary workers must be counted for unfair dismissal protection

The rules on protection against unfair dismissal under the Employment Protection Act ("Kuendigungsschutzgesetz") are only applicable in establishments, if more than ten employees are employed on a regular basis ('regelmäßig').

The Federal Labour Court ruled earlier this year that temporary workers should be included when calculating the number of employees in the workforce if the employment of the temporary workers is considered to be commonplace in that workforce.

The claimant has been employed with the company since July 2007. When the claimant received his notice of dismissal in November 2009, the company only employed ten employees including the claimant. He therefore claimed that the additional temporary workers employed by the company should be included when calculating the number of employees regularly employed in the workforce for the purposes of unfair dismissal protection.

The Federal Employment Court decided that even though there was no direct employment relationship between the temporary workers and the company, the temporary workers could still count as employees under the Employment Protection Act.

Commentary

The court stated that smaller companies were only excluded from the application of the rules of protection against unfair dismissal because such claims caused them a greater detriment than larger companies due to the closer working relationship, relative lack of wealth and the administrative strain and financial costs of a court case.

Consequently, the court decided that one could not distinguish between companies that have more than ten employees of its own and the ones that also had temporary workers.

In the event of the dismissal of an employee, employers should now check not only how many employees they employ, but also whether any temporary workers are or have been employed on a regular basis. This is of particular importance in companies with approximately ten employees. If there are more than ten in total then the employer may consider whether to offer the employee a redundancy payment which is not an obligation under German law, but may be and is regularly negotiated between the parties to avoid long and costly court proceedings.

Resources

Federal Employment Court, decision of 24/01/2013 - 2 AZR 140/12

For further information or to discuss any of the issues raised, please contact Stefanie Andrelang on +49 (0)89 2422300 at Keller Menz, Munich.

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