German Labour Courts Tighten Dismissal Rules, Raising Hurdles for Employers From Consultation Timing to Parental Leave Phases
23.06.2026 - 22:34:53 | boerse-global.de
A string of recent rulings from the Federal Labour Court (BAG) has significantly stiffened the legal barriers companies must clear when sacking workers, while a high-profile conflict over severance at a Zalando logistics hub illustrates how these rules are playing out in practice.
The e-commerce giant's Erfurt distribution centre, which employs about 2,100 people, is slated to close on 30 September. Negotiations over a social compensation plan collapsed on 20 June. Since then, a mediation committee chaired by a former labour judge has convened, with four sessions scheduled by 9 July. The works council accuses Zalando of slashing its originally planned severance fund of roughly €80 million to less than half that amount. Verdi, the union, along with Thuringia's labour minister and Left Party representatives, are demanding a more generous package.
Beyond the immediate Erfurt standoff, the BAG has delivered a series of decisions that make dismissals harder for employers across the board.
Mass Dismissal Notices: No Second Chances
A ruling from 1 April (case number 6 AZR 157/22) establishes that a formal error in the mass-dismissal notification to the authorities renders the termination permanently void. Crucially, this applies when the employer files the notice before completing the mandatory consultation procedure with the works council. Retroactive correction is impossible. The court also tightened delivery rules: a simple registered letter dropped in the mailbox no longer suffices to prove receipt if the employee disputes it, as stated in a 7 May decision. For workplaces with 21 to 59 employees, strict reporting duties kick in when more than five redundancies are planned within 30 days.
Parental Leave Protection Resets for Each Segment
Another BAG judgment, handed down on 18 June (2 AZR 213/25), strengthens employee rights under the Federal Parental Allowance and Parental Leave Act. The special protection against dismissal now restarts eight weeks before each individual block of parental leave, even when multiple periods were announced in a single application. The court overturned the previous interpretation that treated staggered leave as one continuous phase. As a result, employers can no longer issue a termination in the gap between two leave segments. The protection also applies during the probationary period.
AI in Social Selection: Human Final Say Required
When companies use artificial intelligence to rank employees for redundancy, the ultimate decision must remain with the employer, labour law experts emphasise. Works councils hold extensive co-determination rights to prevent discrimination and data protection breaches. For summary dismissals, tight deadlines already apply. In the case of severely disabled workers, the employer must obtain the consent of the Integration Office within two weeks of learning the grounds for dismissal. Missing either that deadline or the statutory two-week period for notice without notice keeps the employment relationship intact, even when allegations are serious.
