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Basic Information
Klaus Stähle
Filip Bork
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Basic Information

Dismissal Protection

a. Don´t miss the three week deadline
Anybody who is dismissed and wishes to appeal needs to act quickly – within three weeks of receipt of written dismissal.

If the three week deadline is not met, it might still be possible to appeal against dismissal. However, in this case the chances of success are significantly diminished. In such cases, approval for delayed action must be applied for, and the application must be made within two weeks of the removal of the obstacle that prevented an earlier appeal from being lodged.

Should the dismissal have been issued by an unauthorized person, e.g. someone who is neither CEO nor head of HR, it can be overturned. The appeal should be lodged immediately.

A direct appeal to the employer, whether via a complaint to the works council or by a written submission to the management, does not affect or extend the time limit for filing legal action.

We therefore encourage clients to make an appointment as quickly as possible, so that all necessary steps may be taken in good time.

b. Appealing against unfair dismissal
The chances of an appeal are significantly better with firms in which 10 or more employees – excluding trainees and CEOs – are employed. The other crucial aspect is that the period of employment should have been at least six months at the time of being given notice. These rules are laid down in the employment protection act (KSchG).

For employees who have been with their employer since before 01.01.2004, employment protection rights may apply if the company employs at least five people. The exact conditions need to be checked in detail. In case the rights laid down in the employment protection act are applicable, the dismissal can be reviewed by the labour court with respect to social criteria.

Dismissal from smaller companies can be successfully appealed against if deemed to be
extraordinarily unfair, because the reasons for dismissal are insufficient or even immoral. You can also take legal action against a dismissal from a small firm, if you are dismissed without notice and with no relevant justification.

According to the Federal Constitutional Court, long-serving employees can appeal successfully if their dismissal contradicts elementary principles such as good faith and the welfare state.

c. Severance payment
After a successful appeal employee and employer often have no interest in continuing the work relationship, and so most unfair dismissal lawsuits end in a financial settlement. Parties often go to court just to negotiate financial terms.

A right to severance pay only exists if the employer has a so-called “social plan” for redundancies and the dismissal is made within that social plan, or if the employer has offered severance pay in the notice of termination according to §1a employment protection act.

Severance pay may also be due if a works council exists but has not appropriately been involved, although a large number of people have been made redundant. Also the court may set a severance payment, if there are special reasons that mean that continued employment is unacceptable for one of the parties.

The initial aim of an unfair dismissal claim may have been the preservation of the employment relationship. But in the course of negotiations the willingness of one or the other side to compromise grows, especially when increasing costs and/or the risk of losing the case influence decision-making.

The amount of compensation then depends on the chances of success in court, the length of service, the financial situation of the employer and, of course, the negotiation skills of the parties involved.

d. Costs of dismissal protection suit
Each of the contending parties has to bear their own legal fees, no matter what the outcome of the case. The court costs must be paid by the unsuccessful party. The costs of appeals – including legal costs of the other side – are paid by the losing party.

Legal protection insurance usually covers labour law issues. Insurers generally pay legal costs and court fees, including opponents’ legal costs if an appeal is lost. If the person dismissed does not have their own legal insurance, the costs may even be covered by the legal protection insurance of another family member.

Should you not have legal insurance and lack sufficient financial resources, you can apply for legal aid.

e. Tax treatment of legal costs
Legal costs that have to be paid (e.g. the fees for advice and representation as well as court costs) as part of running a business, be it as an employer, landlord, investor or to generate other income covered by §22 of the income tax act, are tax deductible business expenses.


 Kanzlei für Arbeitsrecht in Schöneberg Klaus Stähle