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Ordinary termination: what employers need to know

If you as an employer want to give a proper notice of termination, you have to consider a lot. The legal rules at a glance - and sample letters for ordinary termination.

the essentials in brief

  • In the case of ordinary termination, the employment relationship does not end immediately, but only after a period of notice. The notice period depends on how long the employee was employed.
  • Certain employees (works councils, pregnant women, ...) may not be dismissed properly.
  • The general protection against dismissal does not apply to small businesses.
  • Anyone wishing to properly terminate an employee must provide important reasons: personal reasons (e.g. illness of the employee), behavior-related reasons (e.g. refusal to work by the employee) or operational reasons.
  • Before the employer can give an ordinary notice of termination, he must check whether there are ways to continue the employment relationship (for example, a transfer).
  • The employer must inform and hear the works council prior to an ordinary dismissal.

Content: This is what awaits you in this article

What is ordinary termination - and how does it differ from extraordinary termination?

Ordinary termination describes the normal case of terminating an employment relationship: unlike an extraordinary termination without notice, the employment relationship does not end immediately - but only after a period of notice. This is regulated by law, but can also be specified individually in the employment contract. A termination agreement, on the other hand, is a “soft termination”.

Are employers allowed to give proper notice to every employee?

According to existing labor law, certain groups of employees can only be terminated for extraordinary reasons. These special regulations apply to: Works council members and employees with special tasks, trainees after their probationary period, pregnant women, mothers up to four months after the birth, employees on parental or care leave (You can find more detailed information on this in our legal guide on extraordinary termination) - as well as employees who, according to the employment or collective bargaining agreement or company agreement, are not entitled to terminate after a certain age or a certain length of service.

Therefore, experts advise that every employer should check before a notice of termination whether there is a generally binding contract with corresponding regulations on the subject of termination for his industry. The Federal Ministry of Labor and Social Affairs provides an overview of these currently 443 contracts for download.

What you have to consider if you want to quit before starting work: Termination before starting work: when it applies, when not

Do the general protection against dismissal also apply to small businesses?

Employers only have to apply the special provisions of the Employment Protection Act (KSchG) if they employ more than ten employees. But be careful: Until 2004, the threshold was five employees. If an employer still employs five of these so-called "old workers" who were hired before 2004, these continue to fall under the general protection against dismissal - even if the company does not have more than ten employees in total.

When calculating the number of employees, part-time employees working up to 20 hours a week are included with the value 0.5, part-time employees working up to 30 hours a week with 0.75. Temporary workers, working family members, regularly employed temporary workers, employees on parental leave or maternity leave, marginally employed and temporarily closed work relationships must be taken into account by employers when calculating the number - but not apprentices, unpaid interns, managing directors and yourself as the owner.

More on this here: Protection against dismissal in small businesses: employers need to know that

What do companies have to consider that must apply general protection against dismissal?

If the Dismissal Protection Act applies, employers may only terminate an employee if the termination is “socially justified” - for “reasons that are inherent in the person or behavior of the employee, or because of urgent operational requirements that require the employee to continue to work oppose this in this company ”(KSchG, § 1). Important: The burden of proof that these circumstances exist in the event of a termination always lies with the employer.

What reasons justify an ordinary termination?

1. Personal reasons:

Depending on the person, employers can always terminate the contract if an employee no longer performs or performs poorly due to personal characteristics or skills, thus negatively affecting the employer's operational and economic interests - and it can be assumed that this will also be the case in the future. This so-called “negative forecast” is important: If it is not given, the termination would be contestable.

Such a reason for termination exists, for example, if an employee:

  • is ill for a long time - and it becomes clear that he will no longer be able to perform the work in the future (BAG, 2 AZR 1020/08);
  • is often ill for a short time and objective facts or circumstantial evidence make it probable that there will be further absences, for example as a result of short illnesses, and that these will jeopardize the company's interests. The burden of proof of such a negative health prognosis lies with the employer. According to previous case law, such a situation exists if there are absenteeism between 42 and 103 days over a period of five years (BAG, 2 AZR 292/06). Good to know: Alcohol and drug addiction are also considered diseases - but alcohol abuse is not. In this context, a conduct-related termination might be possible;
  • is so impaired due to an illness that he can only provide very limited services, which on average correspond to a maximum of two thirds of the normal service (BAG, 2 AZR 132/91);
  • receives a prison sentence that has long-term negative effects on the company (BAG, 2 AZR 790/09);
  • cannot perform adequately due to reasons of conscience or belief. Important: If a shop assistant wears a headscarf and is therefore terminated, this would be ineffective - because it is discriminatory. If, on the other hand, she refuses to fill the shelves with alcohol due to religious regulations, the employer can terminate the contract (BAG, 2 AZR 636/09);
  • commits a criminal offense which makes it clear that he is unsuitable for his job.

More on the question of why exactly being unable to work due to illness does not protect against dismissal: Termination due to illness: 8 misconceptions about dismissals due to illness

2. Behavioral reasons:

Conduct-related dismissals are always effective if an employee behaves in such a way that continued employment is unreasonable. However, since misconduct can often be changed - unlike a personal ability and quality - a warning usually has to be given beforehand. As with personal termination, there must also be a negative prognosis for behavioral termination.

A behavior-related reason for termination is given, for example, if an employee:

  • repeatedly violates his obligations in the area of ​​services, for example repeatedly performing shortfalls (BAG, 2 AZR 386/03), repeatedly missing without excuse (BAG, 2 AZR 406/03), repeatedly being late (BAG, 2 AZR 199/02) or frequently refused to work (BAG, 2 AZR 357/95) - (read more about refusal to work here);
  • disrupts operational order, for example committing assault (BAG, 2 AZR 280/04), insulting the employer (BAG, 2 AZR 177/02), refusing to provide activity records (BAG, 2 AZR 78/06) or despite being banned guilty of alcohol abuse (BAG, 2 AZR 649/94);
  • the relationship of trust is destroyed by his misconduct, e.g. commits a theft (BAG, 2 AZR 153/11), threatens to become ill (BAG, 2 AZR 123/02), demonstrably fakes an illness (BAG, 2 AZR 154/93) or uses the business internet extensively for private purposes (BAG, 2 AZR 581/04)
  • An off-duty misconduct shows that it also has negative effects on the company, for example if child pornographic images are found on a teacher's private PC.

In the wake of the Corona crisis, many employers are asking whether employees can be dismissed for behavioral reasons if they contract the Covid 19 virus.

You'll find more about it here: Termination due to Corona: These rules now apply to terminations

3. Operational reasons:

Compulsory redundancies are usually the most difficult. They only meet the requirement of the Dismissal Protection Act to be socially justified if there are factual operational reasons that justify job cuts.

A reason for termination for operational reasons exists, for example, if:

  • the external situation makes it necessary to cut jobs, for example as a result of lost orders and sales;
  • The internal situation means that fewer employees are needed, for example as a result of plant closures or outsourcing.

Important: Operational reasons must be "urgent". In concrete terms, this means that it is not enough that economic development is poor or that a company temporarily receives fewer orders. Rather, the law prescribes that redundancies due to operational reasons are only permitted if the company's situation cannot be improved with alternative technical, organizational or economic measures - in other words, redundancies are actually unavoidable.

In addition, having urgent reasons alone is not enough for an ordinary termination. In order to be able to terminate for operational reasons, entrepreneurs must also have already made what is known as an organizational decision, which means that fewer employees are required. Such entrepreneurial decisions - already recognized by jurisprudence - exist, for example, when the employer decides to

  • to redefine the relationship between work volume and manpower volume and to work with fewer employees in the future (BAG, 2 AZR 480/04);
  • to take over work oneself in the future that an employee has done so far (BAG, 2 AZR 559/86),
  • to accept no more orders and to give up operations (BAG, 2 AZR 514/99)
  • to outsource certain tasks that were previously carried out in the company (BAG, 2 AZR 66/04).

Important: In order for this decision to become relevant for termination, it must have already taken on "tangible forms" (BAG, 2 AZR 647/04). It must therefore be implemented at the latest by the time the employment relationship is to end.

And there is one more requirement that employers who want to quit for operational reasons must meet: the possibility of continued employment must be excluded. This criterion of ordinary termination relates to comparable jobs - but also to activities in which the employee to be terminated would first have to familiarize themselves with, as well as to jobs that offer poorer conditions.

If all of this is given, employers may terminate the contract for operational reasons. But who it hits is not in their hands. The decisive factor for this is Social selection: The corresponding legal requirements are intended to guarantee that the employee who is least harmed by the loss of his job will be dismissed.

You can read more detailed information on the subject of social selection and the necessary point systems in our article on redundancy for operational reasons.

Do employers have to offer severance pay if they are dismissed for operational reasons?

There is no obligation for employers to make a severance payment offer in the event of compulsory redundancies. However, the Dismissal Protection Act declares that employers have the option of offering employees severance pay in the letter of termination - in the event that the employee does not file a lawsuit against the termination. Experts advise entrepreneurs to take this opportunity to avoid labor court proceedings. The amount of the severance payment is regulated by law (KSchG, Section 10 (3)). See also pattern below.

Do employers also have to check the proportionality of ordinary dismissals and weigh up interests - as with dismissals without notice?

Regardless of whether it is ordinary or extraordinary: Every time a dismissal is made, employers must check whether it would not be possible to use a “milder means” to improve the employment relationship so that it can be continued - or whether the employee cannot find another job in the company leaves. Anyone who does not do this risks an action for protection against dismissal.

The milder remedies include:

In addition to proportionality, employers must also carefully weigh the interests of both parties before they can issue an ordinary termination. That means: the employer must compare everything that he has to bring against the employee against what relieves the employee. In the case of a behavior-related termination, for example, the employer would have to assess the severity of the breach of duty, as well as the risk of repetition - and compare this with the period in which the employee was not guilty of anything. Age, any severe disability and maintenance obligations must also be put in relation to the specific damage that the employee has caused.

Ordinary termination is only effective if the balance of interests turns out to be negative and no milder means could be used or reasonable.

Does every ordinary termination have to be preceded by a warning?

The rule on proportionality results in the following: In the event of an ordinary termination - especially for behavior-related reasons - a warning must have preceded in the vast majority of cases. Exceptions: The termination without notice is given in a very small company, within the first six months of an employment relationship - or if the relationship of trust or the business process is extremely disturbed by serious breaches of contract. If this is the case, however, an extraordinary termination without notice would also be possible - and thus in most cases also more expedient.

What notice periods do employers have to observe?

The so-called notice period refers to the period between the moment the employee receives the notice and the moment it takes effect. How long the deadline is can be specified individually or for specific industries in contracts. If this is not the case, the deadlines specified in Section 622 of the German Civil Code (BGB) apply to the termination date - depending on the length of service:

  • Trial period up to 6 months = 2 weeks
  • up to 2 years = 4 weeks on the 15th or the end of the month
  • From 2 years of employment = 1 month to the end of a calendar month (Example: If the employee is dismissed on May 3, the employment relationship will not be effectively terminated until June 30.)
  • from 5 years of employment = 2 months to the end of a calendar month
  • from 8 years of employment = 3 months to the end of a calendar month
  • from 10 years of employment = 4 months to the end of a calendar month
  • from 12 years of employment = 5 months to the end of a calendar month
  • from 15 years of employment = 6 months to the end of a calendar month
  • from 20 years of employment = 7 months to the end of a calendar month

Important: Employers are not allowed to shorten the legally prescribed deadlines in individual contracts. In addition, the statutory regulation applies to all types of employment - including part-time jobs and 450 Euro jobs.And: Training periods are taken into account when calculating the notice period, but in most cases not periods when the employee was previously employed by the same employer (BAG, 2 AZR 714/08 and 94/06).

The law only provides for two exceptions: Anyone who has fewer than 20 employees (not including trainees) may specify a shorter period of notice than the statutory notice period in their employment contract - but it must still be at least four weeks. The notice period can only be shorter if an employer temporarily hires someone to help out and does not work for more than three months: In this case, the employment contract may even include the option of immediate termination.

Do I have to include the reasons for the termination in the letter for ordinary termination?

Of course, there must be a reason to justify the termination - employers do not have to record these reasons for termination in the letter. Experts advise using this option and absolutely not giving reasons - in order to prevent the employee from being exposed to a target to sue against the dismissal. There is an exception when employees enjoy special protection against dismissal: In this case, the reason for ordinary dismissal must be precisely explained - “bad behavior”, for example, is not enough.

Who is covered by special protection against dismissal - and what does this mean for employers?

Certain groups of people enjoy special protection against dismissal - such as the severely disabled, pregnant women and young mothers, works council members and caregivers on care leave. However, special protection against dismissal does not mean that these employees cannot be dismissed, but certain specific requirements must be met. In the case of severely disabled persons, for example, the integration office must agree to the termination before it can be sent to the employee. If there is a representative body for employees with severe disabilities, this must also be involved.

Experts strongly recommend that entrepreneurs seek legal advice if they discover that someone they are about to fire falls under special protection against dismissal. Because the regulations are often so special that you can quickly make mistakes - and the termination is then ineffective. For example, the severely disabled: The special protection against dismissal applies even if the employer did not know anything about this status at the time of hiring. And: Only people with a degree of disability of 50 or more are considered severely disabled - but those who have a disability of 30 degrees or more can be treated on an equal footing with a severely disabled person and would then also benefit from special protection against dismissal.

What obligations do employers have to observe?

Certification requirement

The employer must issue the dismissed employee with a certificate of employment: This is necessary so that he can register as a jobseeker and apply for unemployment benefit within three days - if this is not done, the employee faces a blocking period for earnings. For the certification, the employer must use forms from the Employment Agency, which can be accessed here. If an employer does not issue this certificate, too late or with errors, he commits an administrative offense that is punishable by a fine of up to 2000 euros. In addition, he can be sued for damages if the employee has to waive unemployment benefits due to the missing certificate.

Information and consultation of the works council

If there is a works council, the employer must inform and hear it before giving notice of termination. This does not have to be done in writing, but experts recommend it. Because: If there is a dismissal protection process, the employer must prove that he duly heard the works council before the dismissal was pronounced.

In contrast to an extraordinary termination, the works council has the right to object to ordinary termination within one week - and thus also the right to find out details about the person and the reason for the termination in order to get an idea of ​​its legality can.

Specifically, this means that if an employer wants to give an employee a proper notice because they have been sick several times over a number of years, they must tell the works council exactly on which days this was the case (see sample letter below) - the same applies, for example, to a behavior-related termination due to excessive private internet use.

Does an ordinary termination always have to be in writing?

Oral dismissals have been ruled out since 2000 - and this is mandatory: This means that employers are not allowed to stipulate in employment contracts or works agreements that dismissal can be made by non-written channels. If it happened anyway, a corresponding termination would be ineffective. E-mail or fax are also not sufficient, the termination must always be made in writing on paper. The employer must also always sign the notice of termination - under the text, personally and in full. A stamp is not permitted.

Sample: How should an ordinary termination be worded?

Sample letter for an ordinary termination:

(Letterhead from the employer) (Place), (Date)

Dear Madam, dear Sir (…),

I hereby declare the proper and timely termination of your employment relationship.

Due to the regular notice period according to § 622 Paragraph BGB of (XY) months to the end of a calendar month, your employment relationship ends on (XY). Alternatively, I will terminate at the next permitted time.

I would like to point out that when you terminate your employment relationship, you must immediately report to the Employment Agency and develop your own activities when looking for another job. Otherwise you face cuts in unemployment benefits.

With best regards

(Managing Director)

I confirm receipt of the above termination.

……………………………………. (Date)

……………………………………………………………………….. (Signature of the employee)

Sample letter from: Bernhard Striegel, “How do I terminate correctly? Guide for employers ", Beck (2014)

 

Sample letter for an operational dismissal with a severance payment offer:

(Letterhead from the employer) (Place), (Date)

Dear Madam, dear Sir (…),

I hereby declare the proper and timely termination of your employment relationship due to operational requirements in accordance with Section 1 (2) sentence 1 KSchG.

Due to the regular notice period according to § 622 Paragraph BGB of (XY) months to the end of a calendar month, your employment relationship ends on (XY). Alternatively, I will terminate at the next permitted time.

If, within three weeks of receipt of this letter, you do not bring an action to determine that the employment relationship has not been terminated by the termination, you are entitled to a severance payment according to § 1a KSchG at the end of the notice period. The amount of the severance payment is 0.5 monthly earnings for each year of the existence of the employment relationship. Further details can be found in Section 1a KSchG.

I would like to point out that you must report to the Employment Agency immediately on the occasion of the termination of your employment relationship and develop your own activities in the search for another job. Otherwise you face cuts in unemployment benefits.

With best regards

(Managing Director)

I confirm receipt of the above termination.

……………………………………. (Date)

……………………………………………………………………….. (Signature of the employee)

Sample letter from: Bernhard Striegel, “How do I terminate correctly? Guide for employers ", Beck (2014)

 

Sample letter for the works council hearing on ordinary dismissal

(Letterhead employer), (Place), (Date)

 

To the works council z. Attention of the chairman of the works council Ms. / Mr. (...) - In the house -

Hearing on the intended ordinary termination of the Ms / Mr (...) (Section 102 BetrVG)

 

Dear Sir or Madam, dear Ms / dear Mr. (...),

The company intends to terminate the employment relationship of the Ms / Mr (...) properly and in due time, observing the notice period of (...) months to the end of the month to (...) for (personal / behavioral / operational) reasons (termination notice).

We disclose the following employee social data:

Surname: …………………………..

Address: …………………………..

Date of birth: …………………………..

Marital status: ………………………… .. (according to tax card)

Number of children: ………………………… .. (according to the tax card)

Employed since: …………………………..

Place of employment: ………………………… ..

Activity / workplace: ………………………… ..

Notice period: …………………………..

Special protection against dismissal: ………………………… ..

The company considers an ordinary termination to be necessary for the following reasons:

(…)

Due to the aforementioned facts, the company intends to terminate the employee's employment relationship by giving notice immediately after the hearing process has been completed.

In the event of conduct-related / personal termination: Execution to weigh up interests (...).

In the event of dismissal for operational reasons: statement of the social selection (...).

The works council is asked to present its opinion or any concerns / an intended objection in writing within a week.

If you have any further questions, the company management is of course available.

With best regards

(Managing Director)

Attachments: (e.g. employment contract, warnings, etc.)

 

The above letter was handed to me today by the employer.

(Place), the (date) ……………………………………………………. (Signature works council)

Statement of the works council of the company (...) on the intended ordinary dismissal of Ms. / Mr. (...):

The works council gives its consent to the ordinary dismissal of Ms / Mr (...)

Yes No

The works council has concerns about the ordinary termination, namely the following:

(…)

Other comments:

(…)

(Place and date)

……………………………………………………………….

(Chairman of the Works Council)

……………………………………………………………….

(Deputy Chairman of the Works Council)

……………………………………………………………….

(Works council member)

Sample letter from: Bernhard Striegel, “How do I terminate correctly? Guide for employers ", Beck (2014)

 

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