German Top Court Tightens Mass-Layoff Rules as Evonik, Bosch and Warsteiner Announce Job Cuts
20.06.2026 - 06:52:22 | boerse-global.de
The Federal Labor Court (BAG) has sharply raised the legal bar for mass dismissals, ruling that any procedural misstep in the notification process permanently invalidates a termination. The decision, grounded in an EU-compliant interpretation of Germany’s dismissal protection law, insists that companies must complete full consultations with their works council before filing a mass-layoff notice with the Federal Employment Agency. If they fail to do so — or file an incomplete notification — the mistake cannot be corrected later, and every affected worker can challenge the dismissal in court.
The ruling comes as a wave of German employers, led by the specialty chemicals group Evonik, push ahead with deep workforce reductions. Evonik announced in mid-June that it would cut about 3,200 positions worldwide by the end of 2029. Roughly 2,150 of those jobs are in Germany. The company had already planned to eliminate 2,800 roles by the end of 2026, blaming weak market growth and intensifying global competition.
A key part of the restructuring involves shuttering Evonik’s polyester business, which generated €150 million in revenue in its last full year. The site in Witten, which employs 266 people, is set to close by 2027. Additional cuts include 45 positions in Marl and 35 in Shanghai. Evonik’s head of human resources stressed that the reductions will be carried out in a socially responsible way, and the IGBCE trade union confirmed that compulsory redundancies in Germany are ruled out until 2032.
Other major employers are following a similar course. Automotive supplier Bosch plans to eliminate up to 1,100 jobs at its Reutlingen site by the end of 2029. Textile machinery maker Trützschler told employees in mid-June that it would end production at its headquarters in Mönchengladbach, affecting hundreds of workers. The Haus Cramer Group, which owns the Warsteiner brewery, announced it will close the Herford plant at the end of August 2026, putting 97 jobs at risk. Negotiations over social plans and severance are already under way. Meanwhile, the machinery manufacturer Atlas GmbH completed a takeover by a Canadian investor in June, with the buyer making the elimination of 180 of the company’s 400 jobs a condition for the firm’s survival.
The BAG’s stricter approach adds another layer of risk for employers. Under current law, a company must notify the employment agency if it plans to lay off a certain number of workers within 30 days. The threshold is low: in workplaces with 21 to 59 employees, six planned dismissings trigger the obligation. Once a firing notice is issued, workers have just three weeks to file a dismissal protection lawsuit.
Against this legal landscape, employers are increasingly turning to socially compatible downsizing tools as an alternative to outright terminations. Common measures include using natural turnover and hiring freezes, offering voluntary severance or early retirement packages, transferring staff internally, and introducing flexible work models such as part-time arrangements or job-sharing. Works councils have broad co-determination rights in shaping these measures. As the Bremen State Labor Court recently underscored, any dismissal issued before the works council has given its consent or completed its consultation process is automatically invalid.
