The federal government plans to create new corporate penalties and abandon the discretionary principle which has thus far applied in corporate prosecutions. Further, the upper limit of penalties will be significantly increased. At the same time, the government aims to establish legal requirements for internal investigations that provide an incentive for investigation support.
Internet access in the workplace can become problematic when an employer considers the extent to which private internet use is permitted during working hours or restricted and controlled. In the event of unauthorised private internet use, the employer can issue an official warning, dismiss the employee on grounds of conduct or terminate employment without notice, depending on the individual case.
For as long as an employment relationship lasts, an employee must not compete against his or her employer. Even where there is no express clause in the employment contract, an employee must respect the business interests of the employer. A restrictive covenant intended to prevent employees from competing with their employers after their employment has ended can be enforced only if it meets certain legal requirements.
According to the Act on Protection Against Unfair Dismissal, in a difficult economic situation employers are obliged to select employees for dismissal based on social criteria. The employer must consider length of employment, age, support obligations and any severe disability of the respective comparable employees. Consequently, it is usually young employees who are dismissed.
If suspicion of a criminal offence arises, employers may investigate by conducting employee interviews. German law grants employers multi-faceted powers to satisfy requests for information within the framework of the right to issue directives or under the fiduciary relationship that has come about on the basis of the employment relationship.
Many companies pay employees a Christmas bonus, often to reward company loyalty. But do employers have the right to discontinue such bonuses? The Federal Labour Court has expressed doubts that an ex gratia provision in an employment contract can prevent an entitlement from becoming established as a result of unconditional payment.
A recent Federal Labour Court decision on the works council's right to refuse consent when hiring temporary employees into permanent positions restricts the replacement of core staff with temporary employees. The court stated that the Temporary Employment Act contains a non-binding guideline and prohibits any temporary provision of temporary workers.
In the wake of the financial crisis, courts have frequently had to address whether an employer has the right to eliminate an employee's bonus, even if the employee has achieved his or her personal targets. For companies to avoid high bonus payments when financial results are poor, it should be clearly stipulated in the employment contract that financial results are the primary requirement for granting the bonus.
According to the Part-Time and Fixed-Term Employment Act, fixed-term employment agreements are, in principle, valid only if the term is justified on objective grounds. For employers frequently utilising such contracts and operating with successive fixed terms, it is imperative to obtain up-to-date information in order to avoid difficulties. Employers should keep the length of fixed-term employment under control and minimise risks.
Although whistleblowers in Germany rarely become as well known as Edward Snowden, the phenomenon is increasingly relevant in German companies. Employees are caught between the conflicting priorities of reporting obligations and breach of secrecy. If an employee informs a third party of his or her suspicions without having attempted internal remedy, it may be a breach of loyalty under the employment agreement.
The issue of whether a company has increased its pension sufficiently often arises between employers and recipients of company pensions. The review of the pension amount required under statute stipulates that employers must exercise due discretion, taking into account both the interests of company pension recipients and the financial situation of the company.
Social media sites are a popular marketing platform, not only for individuals but also for companies that are discovering new ways of advertising and attracting new clients. Employees have started using their private accounts for professional purposes, but what happens to an employee's social media account after he or she is no longer employed by the company?
The provision of a company car that is also for private use is a popular way of promoting employee loyalty. However, disputes often arise when the employer demands that the car be returned. Under what conditions is this possible, and must the employer observe a notice period?
Under employment law, key employees are subject to a number of special provisions which are beneficial to the employer. However, this does not automatically make all employees with managerial responsibilities key employees, because the statutory requirements attached to this status are very high.
Pursuant to the Works Council Constitution Act, works council members may not be given preferential treatment over other employees on the grounds of their activities. Granting prohibited economic benefits may have serious consequences, potentially leading to criminal charges for all parties.
Compensation cases commenced by employers against employees normally succeed only if they are prepared in detail, on a sound basis, and if the employer has all evidence required to prove that the employee has acted wrongly. Suspending a compensation case in preference to a criminal law investigation rarely gives the employer the desired result.
Companies and their employees can make a significant contribution towards the successful establishment of e-mobility. An increasing number of employers are deciding not to provide their employees with conventional company cars, but rather to offer electric vehicles ('e-cars') for business and private use. In connection with the use of e-cars as company vehicles, particularl aspects of employment law must be taken into account.
In a recent decision, the Federal Labour Court issued a ruling in a case concerning an employer which had enquired whether an employee was disabled during the employment relationship. The court ruled that in future the employer would be allowed to enquire about disabilities during the employment relationship. Although it may not first appear so, this decision is positive for severely disabled employees.
The Federal Labour Court's recent CGZP decision has already had a considerable impact on Germany's temporary work sector. Among other things, social security associations made substantial claims against employee leasing companies for back-payments of social security contributions. Companies which engage leased employees would be well advised to review applicable contracts with the leasing companies.
Two recent European Court of Justice decisions have made fundamental changes to German law regarding entitlement to leave. In future, the parties to collective bargaining agreements in Germany will not be prevented from agreeing a forfeiture deadline for leave transferred as the result of an inability to work. However, the collective bargaining parties cannot be expected to make use of this option across the board.