Termination of employment contracts

Both the employer and the employee can terminate a employment contract. A distinction is made between ordinary termination and extraordinary termination without notice.

Form of termination: How is the employment contract terminated?

Written notice is required for termination: This means that the employment contract is terminated in writing. The written form is observed by signing the letter of termination by hand. Termination by e-mail or by message on the mobile phone is ineffective. Furthermore, the notice of termination must contain the first name, last name and the date of the termination.

Ordinary termination

The term ordinary termination refers to the periods of termination. For the termination, § 622 BGB regulates the periods in which an employment contract can be terminated. If these have been complied with, an employment contract can be terminated properly. The employee can effectively terminate the permanent employment contract within the statutory periods. The employer must always observe other labor law regulations: If there are more than ten employees in the company, protection against German law for wrongful dismissal applies. In this case, the employer’s right to terminate is severely restricted. There are several types of termination:

Operational termination

If the employer wants to restructure his company or the economic situation necessitates the dismissal of employees, the employer has the possibility to terminate the employment contract for operational reasons. The employer must first make a social selection. This means that the employer must dismiss the employee who is least in need of social protection if there are several employees. Termination is not possible if the employee can continue to work in another workplace of the company. In such a case, the dismissal is not socially justified, so the employer must keep the employee employed.

Personal termination

A personal termination is an ordinary termination of the employment contract, which is pronounced by the employer.

What is personal termination?

A personal termination is a termination, the reason for which lies in the person of the employee. There are three reasons for personal termination:

1. Reasons in the person of the worker

A reason which exists in the person of the employee, when the employee is no longer able to perform his previous work performance according to his individual skills and characteristics or suitability. The following conditions must be met:

• There is a significant impairment of the employer’s operational interests.
• A negative prognosis shows that the employee will no longer be able to perform the work due to his lack of suitability or individual skills.
• There is no alternative milder means than the termination. There is no other way of continuing employment in the employer’s business.
• A balance of interests between the interests of the employer and those of the employee is in favor of the employer, which is the case when the employer can no longer be expected to continue working.

2. Behavioral dismissal of the employee

A behavioral termination of the employee is always present if the employee is accused of behavior that entitles the employer to terminate the employment contract.

These four prerequisites entitle the employee to behavioral termination:

1. Violation of the employment contract

The employee must have violated his obligations under the employment contract. A breach of duties means that the employee has culpably breached his duty. If the employee was able to behave differently and nevertheless acted contrary to the provisions of the employment contract, there is a breach of duty. Classically, such breaches of duty exist in the case of an employee being unpunctual, failure to submit a certificate of incapacity for work, refusal to work or an unexcused absence.

2. Previous warning from the employer

The employer must warn the employee before the behavioral dismissal. This means that the employer must make it clear that he does not tolerate the behavior of the employee. The employer should make it clear to the employee that further violations of the employment contract will have legal consequences up to the termination of the employment relationship.

3. Negative prognosis proportionality of termination

 There must be a negative forecast for the employment relationship. This means that the employee will probably continue to violate the obligations under his employment contract in the future. A behavioral dismissal is only lawful if a forecast shows that the employee will not change his behavior.

The termination must be proportionate. This means that the employer has no milder means which can receive the employment contract and which leads to the omission of further breaches of duty. No other funds received in the employment contract may exist.

4. Weighing interests

Termination ends the employment relationship only if there is a comprehensive balancing of interests that the interest of the employer to terminate the employment contract outweighs the interest of the employee that the employment contract continues. When weighing the interests between the employer and the employee, all circumstances of the individual case and the characteristics of the employee (including age and duration of employment) must be taken into account.

Extraordinary termination

Extraordinary termination is also called termination without notice. With this termination, the statutory deadlines of the BGB are not met. An extraordinary termination is only possible under particularly strict conditions.

What are the requirements for extraordinary termination?

1. Important reason

The German Civil Code (BGB) presupposes an important reason for an extraordinary termination. If the dismissal cannot be expected to continue the employment relationship until the notice period has expired, considering all the circumstances of the individual case and weighing the interests of both contracting parties, there is an important reason. Termination without notice by the employer is only possible in limited cases. Jurisprudence requires that the event itself be a reason for termination without notice. This means that there must be a serious breach of duty by the employee. The employee must also have culpably caused the breach of duty. Examples of injurious breaches of duty include the employee’s refusal to work and criminal offenses borne by the employer.

2. Warning

A warning is not mandatory for termination without notice. If a breach of duty is so serious that the employer can no longer find the employee’s continued employment, a warning is not required. However, if several breaches of duty by the employee add up, it is necessary to have issued a warning before the termination without notice.

3. Period of two weeks

The extraordinary termination must be given within two weeks. This means that as soon as the employer has found out about the situation that justifies termination without notice, the employer must pronounce the termination. Terminations made later without notice are invalid. The deadline for the extraordinary dismissal does not start to run until the employer has learned all the facts and circumstances that relate to the facts.

4. Proportionality

The extraordinary termination must also be proportionate. For an extraordinary dismissal, this means that it can only be the very last but also effective means for the behavior of the employee. A milder means can also be the ordinary termination of the employment relationship. Only if it cannot be expected that the employer wait for the period of notice to terminate the contract can termination be considered without notice.

Our law firm will advise you whether termination was justified. We also advise on the legality of a possible termination.