Employment Law in Germany

Employment Law in Germany

German Employment Law has a reputation of being complex, incomprehensible and notoriously adverse to company activities. And yet, Germany is a successful exporter of goods and services. It is argued that the Employment laws do not seem to be a barrier to success, after all. Recruiting employees in Germany is fairly easy. Making them redundant is not as easy but manageable if done so wisely.

EDIFICIA Lawyers has a particular focus on helping foreign companies in entering the German market and protecting them from too grave mistakes in the process.

German Employment Law Services

The legal services of EDIFICIA Lawyers include:

  • Drafting employment Contracts
  • Terminating any employment
  • Providing guidelines for involving a Works Council (Representation of Employees in a company)
  • Restructuring companies sometimes necessitated by Trade Union agreements and state regulations

German employment Law is complex both in terms of substantive law and of its procedural rules. But it has its benefits in avoiding expensive strikes and disputes between employers and employees.

German employment Law concerned with any individual employment relation between employer and employee is based on selected provisions in the German Civil Code, various additional statutory rules and a plethora of case law, which has been developed over the last 40 years by the German Labour Courts  beyond the boundaries of statute law. The legal framework deals with e.g. the protection of employees against unfair/unlawful dismissal, any form of discrimination and the transfer or the closure of businesses or parts of a business affecting employees.

In addition, there are numerous statutory provisions regulating the health and safety standards at a work place.

Companies of a minimum number of employees may be required by its employees to set up a Works Council, which would be in charge of entering into Collective Bargaining agreements with the Employer on certain issues, such as minimum wages, wage categories, holidays, redundancy schemes and various other additional benefits.

Some employers seek to avoid employment protection rules, not least redundancy restrictions by creating free-lance arrangements. Freelancers are solely responsible for themselves to pay their tax and to make their own social security arrangements incl. private health insurance. Although, such arrangements are available and often made use of, the limitations need to be carefully examined.

Other employment arrangements, such as part-time employments, job-sharing arrangements with other employers, and leased employment enjoy the same (statutory or case law) employment protection as ordinary full-time employees.

The employer may wish to enter into fixed term employment contracts, which – within certain legal boundaries – do indeed allow for greater flexibility e.g. in a situation of certain term projects.

In conclusion, a closer look at legal details reveals that the German Employment Law and regulatory environment serves employers much better than it appears at first sight.