1. What types of employment contract are recognised in Germany?
The following types of employment contract are recognised in Germany:
- Permanent contract
- Fixed-term employment contract for specified work
- Fixed-term employment contract for a specified duration only (work unspecified)
- Employment contract with and without reference to a collective bargaining agreement
2. What are the minimum and maximum terms for which a fixed-term employment contract can be concluded in Germany?
A fixed-term employment contract for unspecified work has no minimum term, but a maximum term of two years applies.
A fixed-term employment contract for specified work has no minimum or maximum term requirements.
3. How can a contract of employment be terminated in Germany?
Contract termination must be in writing and must be signed.
4. What are the applicable notice periods, and what determines their length?
A minimum period of notice is required by law (Section 622 German Civil Code), and is dependent on the length of company service as follows:
- for the first two years the notice period is four weeks, up to the 15th day of the month or to the end of the month;
- after two years of service the notice period is one month, to the end of the month;
- after five years of service the notice period is two months, to the end of the month;
- after eight years of service the notice period is three months, to the end of the month;
- after ten years of service the notice period is four months, to the end of the month;
- after 12 years of service the notice period is five months, to the end of the month;
- after 15 years of service the notice period is six months, to the end of the month;
- after 20 years of service the notice period is seven months, to the end of the month.
Longer notice periods can be agreed in the employment contract, while shorter periods can be agreed in a collective bargaining agreement.
5. Is it possible to employ employees as teleworkers in Germany, and are there any particular regulations that apply (differentiating from other regulations)?
Yes, it is possible to employ employees as teleworkers in Germany, and there are no particular regulations that apply.
6. What are the rights for women who become pregnant during their employment contract, and are they protected from being dismissed?
Pregnant employees have the following rights:
- their employer is prohibited from asking them to work at night, on Sundays or on public holidays;
- their daily working time must not exceed 8.5 hours; and
- they must have an uninterrupted rest period of at least 11 hours between shifts / working days.
Pregnant employees are protected from being dismissed if the employer is aware of the pregnancy or the employer became aware within two weeks after determination (Section 17, Maternity Protection Act / Mutterschutzgesetz). The length of the period of employment is irrelevant.
This extra protection against dismissal applies from the beginning of the pregnancy up to four months after giving birth (or miscarriage).
7. What types of paid days-off are the employees entitled to in Germany?
Employees are entitled to:
- a minimum of four weeks paid leave per year;
- one week additional leave for severe disability;
- six weeks of sick leave per year; and
- public holidays.
8. Is it possible to include a non-competition clause in the employment contract, and what are the grounds for concluding a valid non-competition agreement?
During the period of employment, an employee is not permitted to operate in competition with their employer. This is part of statutory law, so a non-competition clause is not needed.
A non-competition clause/agreement must be incorporated in the employment contract to be effective after the period of employment. The agreement must detail its geographical extent, duration and any objective limitations.
9. Is the employer obliged to pay compensation for the period of validity of a non-competition clause/agreement after the termination of employment?
The non-competition agreement is only enforceable if the employer agrees to pay compensation equivalent to at least 50% of the employees former wages.
10. What happens to employees if their employer goes bankrupt in Germany, and are they entitled to severance pay?
There is no entitlement to severance pay when an employer goes bankrupt – the bankruptcy has no effect on the employment contract, which continues to be valid.
The insolvency administrator may terminate the contract within a maximum period of three months. If the employer or the insolvency administrator are not able to pay the employees salary, employees are entitled to receive salary for three months from Germany’s Federal Employment Agency.
11. Are there any courts specially appointed for the purpose of dealing with labour law matters in Germany?
Yes, there are three special labour courts, organised by instances:
- First instance: lower courts (Arbeitsgericht).
- Second instance: the courts of appeals – higher, appellate courts (Landesarbeitsgericht).
- Third instance: the Federal Supreme Court (Bundesarbeitsgericht).
12. In the event that an employee is a debtor in enforcement proceedings in Germany, to what extent is it possible for a bailiff to seize remuneration?
The garnishable salary may be seized.