Mon, Dec. 15, 2003

Termination of Employment Easier

CK - Washington.   The Federal Employment Court in Kassel, the highest German court responsible for industrial relations, recently decided that theft and conversion by an employee of property owned by the employer constitute cause for immediate termination. In another development, the planned tax reduction statute has caused the government to a concession in the area of employment law.

The new employment rules exempt employers with less than 10 employees from the strictest forms of employee protection against the termination of employment contracts. Currently, the exemption covers very small employers with up to five employees. Ten is a more reasonable number in the international experience where a startup should be able to ascertain its future before reaching the new limit.

The BAG decision 2 AZR 36/03 of December 11, 2003, published by Beck, is important because theft and conversion by themselves were not always deemed to constitute cause for termination. Employers were often unable to fire personnel on such grounds. Of particular significance is the court's holding that such conduct constitute cause not only among other factors. In other words, theft and conversion by themselves will constitute cause. The court clarified that other factors may be essential in terms of procedure and timing of the termination, but "other factors" are not to be interpretated as qualifiers of the cause.

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