Employment law in Germany avoiding the common pitfalls? Verena Braeckeler-Kogel

Transcription

1 Employment law in Germany avoiding the common pitfalls? Verena Braeckeler-Kogel London, 03 April 2014

2 Recruitment Advertising job vacancies We are looking for a committed, fully qualified lawyer (0-2 years qualified) We can offer you a dynamic team This role is suitable for a German native speaker Letter of refusal/verbal refusal Sorry, but we were actually planning to hire a woman for this job Risk Damage claim - 3 monthly salaries minimum! 1 / L_LIVE_EMEA1: v1

3 Probationary period Probationary period waiting period under Dismissal Protection Act By when does notice have to be served? How is the termination date calculated? What happens if the probationary period has expired? Can we extend the probationary period? Possible to extend by several months by giving social phase-out notice period but risk of invalidity Works council consultation? Employees with special protection against dismissal? 2 / L_LIVE_EMEA1: v1

4 Fixed-term contracts I Form requirements After starting work? Signature by both parties on same document before starting work! Duration Objective legitimate reason for fixed term Mere time limitation max. 2 years Not possible for former employees (during last three years) Legitimate reason At time of contract conclusion No need to mention in contract (possible exception: replacement cases) No need for congruence between duration and reason but may shed doubts on existence of reason Fixed term contract Compromise agreement 3 / L_LIVE_EMEA1: v1

5 Fixed-term contracts II Extension Up to three times within 2 year period for time limitation without objective reason As long as objective reasons exist; beware of abuse! Agree in writing before expiry of prior fixed term! Amendment of other components at extension? For mere time limitation contracts not permissible even if advantageous for employee (eg salary increase) contract will become indefinite Always separate agreement before or after extension Unless employee is entitled to change of terms due to changed legal situation or under mandatory law Expiry of fixed term Don t accept continued work! 4 / L_LIVE_EMEA1: v1

6 Notice of Dismissal In writing no fax, , text message Signed by legal representative(s) or HR director or holder of PoA (attach original PoA!) Signature and not just initials Correct legal entity, correct letterhead Delivery By handing over original copy in person Countersign as confirmation of receipt or have witness present By delivery through two (!) own employees By courier service/registered post Actual delivery, not mere notification of delivery attempt! Documentation, documentation, documentation! 5 / L_LIVE_EMEA1: v1

7 Dismissal - Timeframes Notice periods Contractual vs statutory Beware of quarterly termination dates or worse! Works council consultation One week consideration period Never send notice letter too early! Special protection against dismissal? Expect significant delays! Mass redundancy? Don t forget authority notification and time it takes to prepare! 6 / L_LIVE_EMEA1: v1

8 Formal warnings Necessary for conduct-related dismissal Three formal warnings? Form requirement? No, but important for evidence reasons! Deadlines? No, but don t wait too long! Necessary content Reprimand purpose precise description of misconduct Reference to expected future behaviour Warning of possible further employment law consequences, up to including dismissal One warning per breach! Don t issue too many warnings! Forfeiture if continued employment without further breaches 7 / L_LIVE_EMEA1: v1

9 Summary dismissal Observe 2-week deadline When is deadline triggered? Dismissal based on suspected or actual breach Consultation of employee if dismissal is based on suspected breach! Consultation of works council before issuing summary notice of dismissal within 2-week deadline 8 / L_LIVE_EMEA1: v1

10 Post-contractual non-compete clauses Use sparingly and carefully! Alternative: longer notice periods No DIY drafting, no use of foreign templates Definition of competitive activities and scope Definition of non-compete compensation half of contractual remuneration last received Exclude application during probationary period Exclude application when retirement age is reached Waiver possible? 9 / L_LIVE_EMEA1: v1

11 Managing Directors Employee Managing Director Promotion of employee to managing director Terminate the employment contract in writing Conclude managing director s service contract Fixed term vs indefinite term Automatic renewal? Ensure clear wording to avoid unpleasant surprises Don t forget formal competencies when dealing with managing directors Check articles of associations Ensure correct person/body acts, especially when terminating 10 / L_LIVE_EMEA1: v1

12 Overtime pay Any overtime (Überstunden) and additional work (Mehrarbeit) is covered by the base salary referred to under clause X of this employment contract. Risk limited under current case law if employee earns >EUR 65k Ideally contractually agree limit of hours covered per week/month Stipulate contractual time-limitation clauses so that overtime claim becomes time-barred after three or six months Employee bears burden of proof 11 / L_LIVE_EMEA1: v1

13 Next German breakfast briefing 18 June 2014 Any proposed topics? 12 / L_LIVE_EMEA1: v1

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15 simmons-simmons.com elexica.com This document is for general guidance only. It does not contain definitive advice. SIMMONS & SIMMONS and S&S are registered trade marks of Simmons & Simmons LLP. Simmons & Simmons is an international legal practice carried on by Simmons & Simmons LLP and its affiliated practices. Accordingly, references to Simmons & Simmons mean Simmons & Simmons LLP and the other partnerships and other entities or practices authorised to use the name Simmons & Simmons or one or more of those practices as the context requires. The word partner refers to a member of Simmons & Simmons LLP or an employee or consultant with equivalent standing and qualifications or to an individual with equivalent status in one of Simmons & Simmons LLP s affiliated practices. For further information on the international entities and practices, refer to simmonssimmons.com/legalresp. Simmons & Simmons LLP is a limited liability partnership registered in England & Wales with number OC and with its registered office at CityPoint, One Ropemaker Street, London EC2Y 9SS. It is authorised and regulated by the Solicitors Regulation Authority. A list of members and other partners together with their professional qualifications is available for inspection at the above address. 14 / L_LIVE_EMEA1: v1