In principle, companies and their employees are free to negotiate employment contracts. These agreements can be written down or concluded orally. In order to ensure that there is evidence of the employment relationship, it is recommended that a written employment contract be entered into. If the employment contract has not been entered into in writing, the employer is required to set the essential conditions of employment in writing no later than one month after the start of the employment relationship. Often, both parties are reluctant to say exactly what they need, what they want and wait when developing employment contracts. Instead, they work with typical contracts that can cover the basics of a professional relationship, but are not very sophisticated and can become responsibilities in the event of litigation. Model contracts should therefore only be used in custom contracts tailored to the needs of both parties. Dismissal on business grounds plays a central role in the termination of employment. Unlike behavioural dismissals or personal dismissals, the reasons for dismissal are not due to the employee`s control, but to a structural enterprise decision of the employer. In the event of dismissal on business grounds, the employer can adapt the number of employees to the needs of the company in order to make a profit. Fixed-term contracts (fixed-term contracts) are valid for a fixed period of time. They may be extended at the end of this period, but the employer is not required to do so. A fixed-term contract can be renewed up to three times, provided the total duration of the employment does not exceed two years.
When drawing up an individual employment contract, the parties must comply with the following provisions: When establishing individual employment contracts, employers must respect the German principle of equal treatment – as interpreted and applied according to German labour law. A tenant has the right to demand that the employer pay the same compensation as the client pays to his permanent employees in comparable positions. The only exception is that the lessor is bound by a collective agreement. The employment contract should set the essential conditions of employment: the threshold of effectiveness of dismissal is quite high. The burden of proof rests with the employer and workers can challenge a dismissal in court. To be effective, the claim must be filed within three weeks of receiving the termination. If the case is not resolved, the court can only decide whether the termination is effective (for sufficient reasons) or not. When the dismissal takes effect, the employment ends at the end of the notice and the employee is not entitled to severance pay (unless there is a social plan or collective agreement providing for severance pay). If the dismissal is not effective, the employee must be reinstated to the previous position and is entitled to pay from the end of the notice period. If you have a mini-job, you are not subject to income tax or social security, but you have the same employment rights as permanent employees, such as sick pay and vacation pay.
In the first four years after starting a business, employment contracts can be entered into without a diabolical reason for up to four years. Our labour and labour lawyers in Germany are aware of these and other risks, and can help you develop an agreement that avoids pitfalls and costly litigation.