Ordinary Termination: What does HR need to know

Ordinary termination
Liz is Head of Legal at twinwin.
As an expert in employment law, Liz enjoys sharing valuable legal knowledge with HR professionals, enabling them to avoid costly legal mistakes. Her mission at twinwin is to make employment law easy for HR.

Employers generally give more ordinary than extraordinary dismissals. This may be partly due to the fact that there are many legal pitfalls lurking in the event of an extraordinary termination. However, even in the event of an ordinary dismissal, the employer or HR department must consider a number of things so that the dismissal is effective and “legally binding.” HR managers should therefore take great care when terminating employees. This is because if the ordinary termination is ineffective, the employee can bring an action for protection against dismissal and this in turn may involve significant risks for the company.

This article is therefore all about ordinary termination. We answer the question of what proper termination means and clarify when an employment relationship can be terminated properly. You will also find out which reasons for ordinary termination are permitted and what HR should consider when doing so.

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What is an ordinary dismissal?

Ordinary termination is usually a Unilateral termination of an employment relationship concluded for an indefinite period, which can come from both the employer and the employee. The terminator must comply with the statutory notice periods, unless other notice periods have been agreed in the employment or collective agreement. But beware: The contractually agreed notice period for the employee must never be longer than that for the employer. It would then be ineffective.

The termination of employment contracts is regulated by law, in particular in Civil Code (Sections 620 to 630 BGB) and in Dismissal Protection Act (KSchG).

 

Notice periods for employment contracts

The notice periods for employment contracts regulate SECTION 622 BGB. According to this, the employer can generally provide an employee with a Deadline of four weeks (28 days) to the 15th or the end of a month cancel (Section 622 (1) BGB). However, the notice period is extended with the duration of the employment relationship. This means that if an employee has been with the company for more than two years, the statutory notice period for the employer is increased at certain intervals. For example, in the case of an employment relationship that exists for more than five years, a notice period of two months to the end of the month must be observed; after ten years, there is a notice period of four months. The highest statutory notice period is seven months to the end of the month if the employee has worked for the company for more than 20 years.

Is an employee still in the probation (including waiting period; up to six months), there is a separate notice period of two weeks to any day.

In principle, only in two exceptional cases may shorter notice periods The following are agreed:

  • if the employee is hired as a temporary assistant (up to three months)
  • If the employer generally only employs up to 20 people (not including trainees); then he may resign at any time, provided that the notice period is not less than four weeks

 

Difference between ordinary and extraordinary termination

While the employer must therefore comply with certain statutory or contractually agreed periods of notice in the event of ordinary dismissal, he can cancel the employment relationship in the event of a extraordinary termination end with immediate effect. He is therefore not bound to compliance with a period of notice, but in principle has the option, in accordance with Section 626 (1) BGB to terminate without notice if there is good cause.

 

When does statutory protection against dismissal apply?

However, before the employer terminates an employee, he must always check whether the employment relationship is subject to the Dismissal Protection Act. The Dismissal Protection Act is primarily intended to protect the rights of employees in the event of ordinary dismissal by the employer. It therefore determines under which conditions the termination of an employment relationship is permitted and how the employer must proceed if he wishes to terminate an employment relationship in due time.

The Dismissal Protection Act applies if an employee already more than six months is employed in the company or company without interruption (Section 1 (1) KSchG), and from one Company size of more than ten regularly employed employees (Section 23 (1) Consumer Protection Act).

 

Protection Against Dismissal Act

When can an employment relationship be terminated properly?

However, the requirements for ordinary dismissal vary, depending on whether it comes from the employer or from the employee.

 

Timely dismissal by the employee

If the employee terminates the employment relationship, it is also referred to as a Self-termination. He is not required to state why he wants to end the employment relationship with his employer. In certain situations, however, it may be useful to give reasons for self-termination, for example if the employee wants to receive a fair job reference. However, he must comply with the notice periods set out in the employment contract. If the employment contract does not contain any provision, the statutory period applies (Section 622 (1) BGB). In addition, he must submit the notice of termination signed in writing and with his own hand (SECTION 623 BGB) so that it is effective.

 

Timely dismissal by employer

In the event of an ordinary dismissal, the employer must pay attention to a number of things so that it is effective. Especially when the employee to be dismissed is subject to general protection against dismissal.

In fact, if statutory protection against dismissal applies, the employer can only effectively and timely terminate the employment relationship if he admissible reason has (which he can also prove!) , which socially justifies the dismissal in accordance with Section 1 (2) KSchG. The Dismissal Protection Act distinguishes between personal, behavioral and operational reasons, which we will discuss in more detail below.

If the Dismissal Protection Act does not apply to the employment relationship, the employer generally does not need any reason to end the employment relationship properly.

However, the employer must comply with further regulations:

 

  • With fixed-term employment contracts Ordinary termination is ruled out in many cases, as the employment relationship automatically ends at the end of the contractually agreed period. An exception only applies if employer and employee have agreed in the contract the option of ordinary termination during the fixed-term period.
  • Certain workers also enjoy a special protection against dismissal, which is why ordinary termination is usually not easily possible here. These include, for example, severely disabled employees, pregnant women, employees on parental or care leave, works council members, trainees and equality and data protection officers. However, the employer may give extraordinary notice under certain conditions.

 

Reasons for ordinary termination

The reasons for an ordinary dismissal play a very important role, as the employer may have to explain why he terminated the employment contract. A valid reason for termination helps to enforce the dismissal in court in the event of a dispute. If there is a legal dispute with the employee, the employer bears the burden of proof in court regardless of the reason for dismissal.

 

Operational reasons for ordinary termination

The employer may terminate an employment relationship for operational reasons if there are urgent operational requirements which make continued employment of the employee unacceptable. The reasons for this can be, for example, internal restructuring, site closures or significant declines in orders and turnover, which result in jobs being lost. However, dismissal for operational reasons is subject to strict requirements: For example, the employer must carry out a social selection and prove that he cannot employ the employee elsewhere.

 

Personal reasons for ordinary termination

If an employee is permanently unable to perform the work owed under the contract due to his personal characteristics or abilities, the employer may give due notice for personal reasons. This may be the case, for example, if an employee is absent for an indefinite period due to illness, serves a term of imprisonment or loses the required license. However, inadequate work due to lack of physical or mental fitness or alcohol addiction can also lead to personal dismissal if the employee is unable to perform the work owed under the employment contract as a result.

 

Behavioral reasons for ordinary termination

The employer can properly terminate an employment relationship due to conduct if an employee repeatedly breaches his employment contract obligations and as a result intentionally or at least negligently disrupts business operations. It is therefore assumed here that the person concerned can control their behavior. Even though the law does not give any specific reasons for behavioral dismissals, there are numerous examples from employment law practice that confirm these. Some examples which, in the opinion of the Federal Labour Court, may justify behavioral dismissal include: repeated late arrival, persistent refusal to work, omitted or late sick report, underperformance, working time fraud, theft, self-leave of absence, insult of work colleagues, supervisors or employers, bullying and unauthorised competition.

 

Ordinary dismissal process: What are the employer's obligations?

In order for an ordinary dismissal to be valid in court, the employer must not only prove an important reason for dismissal, but also fulfill other duties and requirements.

 

1.  Proportionality of termination

The dismissal must be proportionate and may only be used by the employer as a last resort. This means that before giving an ordinary dismissal, the employer must check whether there are more lenient means available to him to possibly maintain the employment relationship after all. More lenient means include, for example, a warning, a transfer or a notice of change.

2nd  Informing and hearing the works council

If there is a works council in the company or company, it must be properly consulted before dismissal (Section 102 (1) Works Constitution Act (BetrVG)), otherwise the termination is ineffective.

3rd  Compliance with special protection against dismissal

In addition, the employer must check whether the employee falls under special protection against dismissal. For example, when terminating a severely disabled employee who has been employed in the company or company for more than six months, the employer must involve the representatives of the severely disabled person (Section 178 Ninth Social Code (SGB 9)) and obtain the approval of the Integration Office (Section 168 SGB 9). If the employer wishes to dismiss a pregnant employee, he may only do so if he has first obtained the consent of the highest state labor protection authority (Section 17 (2) Maternity Protection Act (MuSchG)).

 

4th  Compliance with form and deadline

The dismissal must comply with the statutory, employment contract or collective notice periods.

It is also important that the employer takes into account the formal requirements for ordinary dismissal. Ordinary termination must therefore always be made in writing (Section 623 BGB). For a legally effective termination, it is therefore not sufficient to send it via e-mail or messenger such as WhatsApp to the employee to be terminated.

In addition, the proper written form requires the handwritten signature of the employer or a person entitled to dismiss. This means, for example, that the management of the HR department may only sign the notice if it is authorized to do so and may give the notice on behalf of the personnel department. To make it clear who is quitting whom, both parties should be clearly identified by name and address.

Important to know: Even though the employer must generally give reasons for an ordinary dismissal, he is not obliged to state a specific reason for termination in the notice of termination. He therefore does not have to state in the letter of termination whether he is terminating the employment relationship for personal, behavioral or operational reasons.

The termination must also be clearly formulated and must leave no room for interpretation or misunderstandings. The notice of termination must therefore clearly state that the employment relationship will be terminated and at what point in time. The notice of termination should include a reference to the reporting requirement. In order to avoid a reduction or suspension of unemployment benefits, the employee to be dismissed should be advised to register as a jobseeker. If this notice is missing, this does not invalidate the termination, but could retroactively establish a claim for compensation against the employer.

5th  Issuing a work certificate  

After the end of the employment relationship, the employer must issue a work certificate to the dismissed employee so that he can apply for unemployment benefits if necessary. In principle, however, he only has to do this if the employee or the employment agency so requests. It is then important that the employment certificate is issued correctly and on time.

When is a notice of termination considered to be delivered on time?

A notice of termination is considered to have been delivered in due time if it is received by the recipient within the period specified in the contract or by law. The employer can decide for himself how he wants to send the letter of termination to the employee to be dismissed. For example, he can hand over the letter personally and in the presence of witnesses or have receipt confirmed, for example by registered letter with acknowledgment of receipt. In any case, however, he must be able to prove that the notice of termination has actually been received. This is particularly important if the employee claims that he has not received the letter of termination.

When must the employer issue a notice of termination?

Issuing a notice of termination can be important when it comes to compliance with notice periods — both for the employee and for the employer. Because after SECTION 130 BGB A notice of termination only becomes effective when it has been received by the recipient. A confirmation of termination is not required by law. However, it may be useful in order to be able to prove that the notice period has been met under certain circumstances.

Does your company need assistance with an ordinary termination?

If an employee has to leave the company involuntarily, there is usually potential for conflict. If, for example, an ineffective dismissal is given, the employee concerned can sue the company within three weeks of receipt of the notice of termination. This can involve significant financial and legal risks for a company.

Twinwin can relieve you as much as possible in such cases, because our modules are tailored precisely to the requirements of HR work. Our question & answer module provides you with reliable information on all employment law topics and can support you, for example, if the issue of termination becomes topical in your company.

Our separation manager offers you immediate help with high-risk topics such as cancellations. Because if you're actually considering terminating an employee, we highly recommend that you use the Separation Manager to get a risk assessment for a potential separation, additional information, useful tips, and best practices. In our template pool You will also find a legally secure and up-to-date cancellation template.

If necessary, we can also provide a seamless transfer to careful selected partner law firms who consist of specialists in employment law and can offer you legal support through attractive pre-negotiated hourly rates.