Lawyers International Network for Employees and Executives (LINEE)

Benjamin Biere

Germany’s Approach to Short-Time Work Is a Key to Weathering Economic Emergencies

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During the last economic crisis in 2009, Germany was already respected worldwide for its crisis management and its approach to short-time work benefits (“Kurzarbeit”) specifically. The co-determination regulations on Kurzarbeit significantly helped Germany overcome the emergency like no other country, and it laid essential foundations for post-crisis economic growth. 

Short-time work was a vital factor in Germany’s ability to weather the 2009 economic crisis and gather crucial resources to bounce back. Because of this positive experience, the German government has not hesitated to turn to Kurzarbeit during the COVID-19 pandemic to relieve small and medium-sized enterprises that continue to face financial hardship. To this end, the federal government has lowered formal hurdles to the introduction of short-time work and expanded its room to maneuver.

Employee Whistleblower Protection in Germany

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Whistleblowers in German workplaces run the risk that their efforts to comply with reporting laws will be “rewarded” with immediate dismissal. To date, no law comprehensively protects whistleblowers, so courts decide retaliation claims on a case-by-case basis. Nevertheless, some principles of what workers should do and what they should not do can be deduced from such cases.

COVID-19 Has Spotlighted Whistleblower Retaliation Situations

During the pandemic, there have been more cases where companies and employees have not respected strict safety rules and necessary hygiene guidelines. In one situation involving a German slaughterhouse, an employee recorded a video about the unsustainable conditions in the company canteen that endangered workers and exposed them to the coronavirus. After sharing the video online, the company dismissed the employee without notice.

From a public policy perspective, whistleblowers play an important role. Like the state, the public has a legitimate interest in knowing about unlawful practices and seeing that the illegal or unethical behaviour is remedied. At the same time, employers expect loyalty from their employees, hopefully encouraging them to raise issues internally and not expose the company to premature or unwarranted and considerable negative economic consequences. Read more.

10 Points About Employment Bonuses in Germany

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In Germany and around the world, a bonus can be a substantial component of an employee’s compensation, particularly among executives. Below is information you should know when negotiating a bonus or seeking to have your employer pay a bonus to which you are entitled.

There Are Different Forms of Bonuses

There is no single type of bonus payment in Germany. Instead, there are several bonus categories, each aligned to a distinct incentive or purpose. For example, a performance-based bonus compensates the employee for individual results, while a profit-sharing bonus – usually reserved for high-level employees – is based on the company’s achievements. Employees may also be paid gratuities, such as holiday or anniversary bonuses, and supplemental pay to compensate for extra work time.

Bonus Policies Are Generally Discretionary

Companies often give themselves the authority to determine bonus amounts, conditions for payout, and when or even if they will grant a bonus. Employees seeking bonus payments look to German labor tribunals to force companies to adhere to their own rules and policies, ensuring employers treat workers fairly. Read more.

Non-Competition Clauses and Preliminary Contracts in Germany

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High-level performers significantly contribute to their employer’s business. Because of this, employers frequently include non-competition clauses in employees’ preliminary employment contracts to control their behavior and activities after they leave the company.

With post-contractual non-competition clauses, companies aim to protect themselves against the risk that departing employees who later work for competitors might use valuable knowledge about operations, trade secrets, financial information, or important business contacts to gain an advantage.

Enforceability of Non-Competition Agreements in German Labor Courts

In Germany, labor tribunals carefully check preliminary contracts to determine whether non-competition clauses overly restrict employees from pursuing their careers or professional activities, but that doesn’t mean such agreements are unenforceable. Read more.