Employee data protection: Notification of private mobile phone number to employer

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Data Protection, Working time, Written Warning

October 16, 2018

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The Higher Labor Court of Thuringia decided that the processing of an employee’s private mobile phone number against his will is an extremely serious interference with the employee’s personal rights and was not justified in the specific case (decision on 16 May 2018 – docket number 6 Sa 442/17). Therefore, the warning issued in this context was ineffective.

The employee works for the district in the area of hygiene and infection protection. In the employee’s area of responsibility, hazards could arise which make it necessary to act outside working hours. Until the end of 2016, this was ensured and organized by on-call duty. Pre-defined employees were assigned to on-call duty 24 hours a day, seven days a week. A business mobile phone was made available for the necessary contact. In addition, the employees received additional remuneration for on-call duty.

With the purpose of saving costs, the employer decided to reorganize the coverage of necessary activities outside working hours. From January 2017, on-call duty was limited to weekends and public holidays. Outside these times in the event of an emergency, the control centre should try to contact one of the seven employees in the area of hygiene and infection protection by any means. It was left to chance which employee was contacted. For the implementation of this concept, the employer requested notification of the employee’s mobile phone number.

The employee refused to give his mobile phone number and therefore received the warning.

With reference to the national data protection law, the court decided that the refusal of the employee was not a breach of duty. The mobile phone number was not necessary for the performance of the employment relationship or for the purpose of personnel deployment. The processing of such data is only permissible in exceptional cases if the employer, is unable to perform a legitimate task for which the employee is employed, or is unable to perform it in full or in a lawful manner, without knowledge of the mobile phone number. Additionally, it must be impossible or unreasonable to organize the performance of the task by other means.

The employer’s interests in determining work processes and work organisation within the framework of his entrepreneurial freedom did not prevail over the employee’s right of personality and did not comply with the principle of proportionality. The interference in the personal right of the employee is the collecting of the mobile number and thus the possibility of contacting the employee at any time and in any place. The employer wants to have the mobile number only and exclusively to contact the employee in his spare time.

Within a detailed weighing of interests, the court decided, that it is particularly important to consider that the employer has intentionally chosen to change his organisation of processes. The employer no longer wants to decide beforehand who he wants to use for work performance, but leaves this to chance with the result of interference in the employees’ leisure time. In addition to that, the court held that the employer wanted the personal mobile number to cover basic tasks and not just emergencies.

The decision makes clear that employers are not allowed to contact employees arbitrarily during their free time. Even if the court refers here to the data protection law, it is also unlawful under German labour law to make use of the employee outside working hours and to demand from him a permanent readiness. However, the fact that the decision is based on data protection law emphasizes its important role in employment related matters. Employers should carefully proof whether it is necessary to ask the employee to give the private mobile phone number or if there are alternative means to perform the task in question. If employees voluntarily provide their private mobile number to the employer, the use of it shall be in line with the purpose for which the private mobile phone number was provided.

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Occupational health and safety standards as a limit to the employer’s right to issue instructions

Categories:

burden of proof, Change of job position, Conduct Related Dismissal, Dismissal, Health, instructions

October 12, 2018

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The allocation of a job which does not meet the requirements of Sec. 618 para. 1 German Civil Code (Bürgerliches Gesetzbuch, BGB) in conjunction with the public occupational health and safety standards may nevertheless correspond to the employer’s equitable discretion if it concerns only minor or short-term infringements which cannot cause lasting damage.

This is what the German Federal Labor Court (Bundesarbeitsgericht, BAG) decided in its judgement of 28 June 2018, docket number 2 AZR 436/17.

The parties disputed the existence of an employment relationship. Since 2006, the plaintiff (former employee) had been employed by the defendant (the employer) as head of the “Technical Documentation” department. There were on-going conflicts between the plaintiff and other employees. In November 2012, the plaintiff’s employer withdrew the line of responsibility from the plaintiff. In February 2014, five employees in the department requested a transfer of the plaintiff to a different location. In their view the plaintiff sought conflicts and did not maintain an appropriate distance. As a result, many employees avoided entering common rooms in order to avoid the plaintiff. In May 2014, the employer commissioned the plaintiff to draw up a “building book” and transferred her away to the respective building to be examined. There were no other offices in this building. The plaintiff received a workroom with a desk and a simple wooden chair. The plaintiff also received the order to furnish her workplace with the necessary IT and communication equipment as well as any additional furniture. In the absence of a time stamp clock, she was to document her working hours by hand and send an e-mail for checking purposes at the start and end of her duties. The plaintiff refused the job due to the assignment of non-contractual duties and insufficient office equipment. After repeated warnings, the employer terminated the plaintiff’s employment with extraordinary immediate effect. The Labor Court Munich granted the dismissal protection action. The appeal was unsuccessful.

The BAG clearly indicated that the allocation of specific job duties for reasons of efficient completion of work tasks and because of the objective of protecting the remaining employees from further contact with the plaintiff corresponded in principle to equitable discretion. In the opinion of the BAG, merely minor or short-term violations of occupational health and safety standards that cannot cause lasting damage do not make the workplace unacceptable. The same applies to the instruction to the plaintiff to set up its own workplace. This one-off additional work represents at most a temporary “inferior” activity. Furthermore, the Court stressed that the plaintiff had not been completely isolated from other employees and had not been spun off from the operational organisation. Rather, the plaintiff had remained assigned to its previous operational unit and had had contact with other employees through its networked workplace.

The BAG thus clarifies that the mere possibility of a health hazard from a transfer is not yet sufficient to make the transfer violate the principle of equitable discretion because of a breach of the employer’s duty of care. Accordingly, there is no right of retention in the employment relationship in favour of the employee pursuant to Sec. 273, 618 BGB in the event of only minor or short-term violations of occupational health and safety obligations by the employer. If an employee nevertheless refuses his or her obligation to work because he or she believes that he or she is entitled to do so because of an unfair instruction, he or she shall bear the risk that his or her opinion may prove to be wrong. In case of doubt, employees should therefore be advised to follow such allegedly unreasonable instructions.

It is also noteworthy that the BAG considers the protection of other employees from the plaintiff to be a valid reason for transferring the plaintiff. The court referred here to its jurisdiction in “mobbing cases”. In those cases the question arose whether measures of the employer violate the personality right of the plaintiff employee. In the present judgment, the right of personality of the remaining employees now serves as a possible justification for measures against the plaintiff employee.

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Good news for parents? – Interpretation of social plan severance provisions

Categories:

Discrimination, Equal Treatment, Parental Leave, Part-Time Work, Remuneration, Uncategorized

October 9, 2018

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If, in a social compensation plan, the severance payment calculation is based solely on the gross monthly basic salary of a single reference month, the decisive salary of employees who work part-time in that month during their parental leave, is the gross monthly basic salary which they would have been entitled to under their employment contract if they had not been on parental leave (i.e. if they had not worked part time.
This is what the German Federal Labour Court decided in its judgment of 15 May 2918 – docket number 1 AZR 20/17.

The Court held that the system of the social compensation plan as well as the purpose of the severance payment regulation argued in favour of this interpretation. For example, the parties had expressly excluded individual remuneration components such as bonuses, special payments, premiums and variable elements, which were either dependent on the actual performance of work in the reference month or were made precisely in this month, although the remuneration was to cover work performed over a longer period of time. According to the Court the intention was to prevent the amount of the severance payment from being determined on the basis of “random” payments made in the reference month. At the same time, the Court held that the parties to the social plan agreement (employer and works council) intended to ensure that a temporary suspension of the main contractual obligations under the employment contract would not lead to a reduction in the severance payment. In the view of the Court the reason for the suspension (e.g. parental leave, (family) care time, a claim to continued payment of remuneration under the Continued Remuneration Act or unpaid special leave) was intended to be irrelevant.

An understanding of the social plan regulation to the effect that, in the case of part-time work carried out during parental leave, the reduced gross monthly basic salary in the reference month due to part-time work is relevant for the calculation of the severance payment is considered an unjustified differentiation between employees on “full-time” parental leave and those who additionally work part-time during parental leave. While the former would thus be entitled to a compensation payment based on their contractually agreed gross monthly basic salary, the calculation for the latter would only take the actually paid remuneration into account, which is reduced due to part-time work. In the eyes of the Court this was an unjustified violation of the principle of equal treatment under the German Works Constitution Act (Betriebsverfassungsgesetz, BetrVG).

With this decision the Federal Labour Court strengthens the rights of parents who work part-time while being on parental leave.

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Employees Cannot Claim Default Lump Sums for Late Wages

Categories:

Legislation

October 2, 2018

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Anyone who fails to pay his debts on time and comes into default of his payment obligations must pay default interest. In addition, the creditor may demand a lump sum for default costs in the amount of EUR 40.00 due to sec. 288 para. 5 of the German Civil Code (Bürgerliches Gesetzbuch, BGB) if the debtor is an entrepreneur. As of the introduction of that regulation by the legislator in 2014, it has been disputed whether sec. 288 (5) of the German Civil Code also applies to employment law situations. A large number of regional labor courts had previously affirmed the application of that regulation and decided that employers which were in default of their payment obligations towards their employees had to pay the default lump sum.

With the latest decision (docket number: 8 AZR 26/18), the Federal Labor Court has now clearly positioned itself – and has spoken out against the applicability of the default lump sum payment in employment law situations.

The Federal Labor Court decision was based on the following case:

The plaintiff worked for the defendant for several years. He filed a claim against the defendant for late payment from May to September 2016. In addition, he demanded three lump sum payments for default on the basis of sec. 288 (5) of the German Civil Code for the months July to September 2016.

The lower courts upheld the action. The Federal Labor Court was of a different opinion.

In the event of an employer’s default of payment of remuneration, the employee is not entitled to a lump sum for default in accordance with sec. 288 (5) of the German Civil Code. This results from sec. 12a  para. 1 sent. 1 of the Labor Court Act (Arbeitsgerichtsgesetz. ArbGG). The regulation states that the parties have no right to claim extrajudicial costs from the opposing party incurred by them in proceedings before the labor court. The Federal Labor Court regards sec. 12a of the Labor Court Act as a special regulation. The regulation not only excludes a claim for reimbursement of procedural costs but also the corresponding material claim for reimbursement of costs. Thus, the claim for the lump sum for default according to sec. 288 (5) of the German Civil Code is also excluded in employment law situations.

The ruling of the Federal Labor Court creates clarity and legal certainty. The EUR 40.00 default lump sum no longer plays a role in employment law.

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EU Directive Draft “Whistleblowing”

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Uncategorized

October 2, 2018

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On 23 April 2018, the European Commission presented its draft directive “proposal for a directive of the European parliament and of the council on the protection of persons reporting on breaches of Union law”.

The proposal is based on the official Council of Europe Recommendation on the protection of whistleblowers of 2014, according to which Member States should have a legal and institutional framework to protect persons who, in the context of their industrial relations, draw attention to violations and threats to the public interest or make information on them public. The central approach and declared objective of the EU Commission’s draft directive is to create a uniform framework to strengthen the protection of whistleblowers at EU level.

An EU-wide uniform standard for the protection of whistleblowers does not exist yet. Only ten Member States have enshrined comprehensive and sufficient protection for whistleblowers in law, Germany is not one of them.

For some of the legal areas mentioned in the draft directive, German law already contains requirements, e.g. for the financial services sector (§ 4 d FinDAG) or for reporting violations in connection with money laundering and terrorist financing (§ 6 V AMLA). There are also regulations for cases of discrimination (Sections 13, 27 I AGG) or in the area of occupational safety (Section 17 ArbSchG) beyond the objective scope of application of the proposed directive. However, a general legal regulation is still lacking.

According to the draft directive, a minimum level of protection is to be guaranteed in future on the basis of EU-wide minimum standards.

However, these are only minimum standards, as the limited scope for only certain areas shows.

In contrast, the concept of the whistleblower to be protected is interpreted broadly. In addition to employees in the private or public sector, shareholders, management bodies, unpaid interns, volunteers and suppliers should also benefit from the planned rules.

The whistleblower does not have to act with the intention of protecting the general “public interest” when providing the information.

One of the main points of the draft directive is the obligation for companies to introduce an internal procedure for dealing with whistleblower reports (whistleblower system). This affects companies with more than 50 employees or annual sales of more than 10 million euros.

Within the framework of this whistleblower system, a responsible reporting office must be appointed, which is to be organised either internally or externally. The identity of the whistleblower must be treated confidentially and protected from access by unauthorised persons.

A three-stage escalation procedure is prescribed for employees. Accordingly, whistleblowers must first report violations of the law to the internal whistleblower in order to allow the company to investigate possible grievances itself. If the company does not respond to the information within three months, the whistleblower can approach the competent authorities at the second stage. Here, too, there is a three-month deadline for re-registration. If no suitable measures are taken on the first two levels, the whistleblower can finally approach the public, e.g. via journalists and media, on the third level.

The employer is to be prohibited from taking personal retaliatory measures against the whistle-blower (e.g. indemnity, termination, negative performance assessment), provided that the whistle-blower has followed the prescribed procedure. The employer must bear the burden of proof.

The draft directive has yet to be adopted by the Heads of State and Government. If this happens, the draft directive already provides a deadline for transposition into national law by the member states by 15 May 2021.

Companies should therefore begin to deal with the introduction of the whistleblower system.

 

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Legal Useability of Recordings from Open Video Surveillance

Categories:

burden of proof, Data Protection

September 21, 2018

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By its decision of 23 August 2018 the Federal Labor Court (docket number 2 AZR 133/18) facilitated video surveillance at the workplace. Legally and openly created recordings do not have to be deleted by the employer within a few days. According to the Federal Labor Court, they can be evaluated several months later.

Under data protection law employers are in principle entitled to use video cameras to publicly monitor accessible sales areas in order to protect themselves against criminal offences. The purpose of such video surveillance does not have to be exclusively to prevent crimes committed by customers. Rather, the employer can also pursue the purpose of protecting himself from criminal offences committed by employees. In such cases, video surveillance must be disclosed or made visible, usually by information signs. In addition, the employer must delete the video material as soon as possible. Section 4 para. 5 of the Federal Data Protection Act (Bundesdatenschutzgesetz, BDSG) states that data shall be deleted immediately if it is no longer necessary to achieve the purpose or if legitimate interests of the parties concerned are affected.

In the particular case, the plaintiff worked in a small shop with open video surveillance installed by the defendant. According to the defendant, a shortage of tobacco products was found in the third quarter of 2016. A random analysis of the video recordings conducted in August 2016 had shown that the plaintiff had not deposited the funds collected on two days in February 2016 in the cash register. Therefore, the defendant terminated the employment relationship for good cause. The affected employee succeeded before the local labor court with her claim for wrongful dismissal. Also the Labor Court of Appeal in Hamm (docket number 2 Sa 192/17) ruled that the findings from the video surveillance were subject to a prohibition on exploitation due to Section 4 para. 5 of the BDSG, as the defendant should have deleted the video sequences immediately, in any case at least before 1 August 2016.

The Federal Labor Court surprisingly overruled the decision and made quite a turnaround compared to earlier decisions with similar situations where usually, as a rule of thumb, material was to be deleted after the expiration of 1-2 days due to the legal principle of data economy.

According to the Federal Labor Court, the storage of video sequences from a legitimate open video surveillance showing intentional actions of an employee to the detriment of the employer’s property is allowed, as long as punishment for the breach of duty is possible under employment law. In particular, the defendant was not obliged to analyze the surveillance material immediately. He was allowed to wait until he saw a valid reason to do so. The analysis of the video material conducted approximately six months after the recording did not conflict with Section 4 para. 5 of the Federal Data Protection Act and therefore did also not conflict with the general right of privacy of the employee protected by Article 2 para.1 in conjunction with Article 1 para. 1 of the German Constitutional Law (Grundgesetz, GG).

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Imminent invalidity of limitation periods

Categories:

Employment contract

September 20, 2018

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In a Judgment dated 18 September 2018 the Federal Labour Court ruled that limitation periods, which do not exclude a claim for the Minimum Wage (Mindestlohn) according to the Minimum Wage Act (Mindestlohngesetz), are invalid. This results in the ineffectiveness of thousands of limitation periods in employment contracts.
In Germany, limitation periods within which a claim must be asserted are commonly agreed in employment contracts. These generally amount to three months and are therefore considerably lower than the limitation periods provided by law. However, the exclusion periods may be invalid, because employment contracts are subject to the terms and conditions control (AGB- Kontrolle).
This means that every clause in the contract needs to be controlled regarding its effectiveness.
Among other things contract clauses are invalid, if there is disproportionate disadvantage to the contracting party. Such a disadvantage also exists if the clause is not clear and understandable or violates fundamental principles of a legal regulation. There is no validity preserving interpretation of the clause. If the clause is incomplete or does not include or exclude necessary contents, then the whole clause is void.
Against this background, the Federal Labour Court ruled that limitation periods that do not explicitly exclude the Minimum Wage guaranteed by law are invalid. The Minimum Wage Act requires that agreements restricting the assertion of the Minimum Wage are not effective. So far, there was disagreement between the Higher Regional Labour Courts, as to how to deal with this legal regulation in terms of the control of general terms and conditions (AGB- Kontrolle). Now the Federal Labour Court has finally decided the dispute. This applies at least to contracts concluded from 31 December 2014, as the Minimum Wage Act entered into force on 1 January 2015. As a consequence the claims, which may in principle be subject to an limitation period, are governed by the limitation period by law in the event of invalidity of the clause. This is, depending on the nature of the claim, regularly at least three years.
It is to be expected that due to the same reasoning in the future further non-excluded claims will lead to the invalidity of the limitation period. Companies should therefore urgently revise their employment contracts and include an appropriate clause. Such a clause could be formulated as following:
§ XXX limitation period
I. Claims from the employment contract need to be asserted in writing (textual form) to the other party within three months from the due date. If the respondent does not respond or does not acknowledge the claim, the claimant needs to bring an action within three further months.
II. All rights that are not claimed in due time in accordance with paragraph I expire without replacement.
III. This does not apply to claims for the Minimum Wage, for pensions, for property rights (such as surrender claims, for violations of personal rights, for employment, for the removal of a warning letter from the personal file, for classification, regarding activity as a works council member as well as claims due to liability for intent or gross negligence. For these claims, the limitation period provided by law applies.

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No co-determination rights of the works council for stock options issued by a foreign parent company

Categories:

Benefits, Remuneration, Works Council

August 1, 2018

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In a judgment dated 3 August 2017, the Higher Regional Labour Court of Hessen has held that a works council’s co-determination rights do not extend to stock option plans by an employer’s foreign parent company (docket number 5 TaBV 23/17).

 

Under German law, works councils have a co-determination right regarding remuneration principles. In this case, the foreign parent company decided annually and independently from the local employing entity whether stock options were to be granted, which employees would receive these stock options and, if so, how many. Local employment documents of the German employees did not include any reference to the stock option award as part of their remuneration, and the German employing entity did not have any influence on the award process. The local works council claimed a co-determination right with regard to the award process based on the implementation of remuneration principles.

 

The Higher Regional Labour Court rejected this claim, stating that co-determination rights of the works council only applied if the employer had at least a certain amount of freedom to make an independent decision. Merely executing binding guidelines or decisions is not sufficient to trigger co-determination rights. Since the local employing entity had no say in the stock option award process, e.g., through a right to make proposals, there was no room for negotiations with the works council.

 

An appeal against this decision has been lodged with the Federal Labour Court under the docket number 1 ABR 57/17.

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Addressing applicants “who are about to graduate”, asking for “very good German and English language skills” as well as a description of being a “young, dynamic company” is in general non-discriminatory

Categories:

burden of proof, Compliance, Discrimination, Equal Treatment

July 24, 2018

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On 23 November 2017 the Federal Labour Court (Bundesarbeitsgericht, BAG) ruled in two parallel proceedings, each with the same plaintiff, on compensation claims for an alleged infringement of the principle of non-discrimination under the General Equal Treatment Act (Allgemeines Gleichbehandlungsgesetz, AGG) on the basis of two job advertisements. The first position required a completed degree, or that the applicant was about to graduate, as well as very good German and English language skills (docket number 8 AZR 372/16). The second position was advertised by a company that described itself as being “young, dynamic” (docket number 8 AZR 604/16). The defendants rejected the applications made by the plaintiff. As a result the plaintiff brought claims for compensation, inter alia, due to discrimination on grounds of age and ethnic origin. In support of this the plaintiff referred to the wording of the job advertisements.

The Federal Labour Court stated that applicants who consider themselves wronged because of a breach of the principle of equal treatment satisfy the burden of proof if they can present evidence that indicates, with overwhelming probability, that a disadvantage has occurred due to the reasons stated in sec. 1 General Equal Treatment Act.

Advertising a position which is contrary to the principle of non-discrimination, may justify the finding that an unsuccessful applicant was disadvantaged in the selection procedure and it is then down to the employer to refute the allegation. In the present cases however, no such evidence was provided.

“Being about to graduate” (8 AZR 372/16) and “young, dynamic company” (8 AZR 604/16)

It was held that “being about to graduate” did not refer to an exact age and it was not to be understood as a requirement that only addressed young applicants. According to the Federal Labour Court, older people would not have been seriously discouraged from submitting their applications and thus, it did not suggest discrimination because of age. The same applied to the company’s statement that it is ‘a young, dynamic company’ as this was held to be enterprise-related information that did not refer to the workforce or the desired applicants. However, it was suggested that this decision could be different if the company was, in fact, an old business or the terminology referred to a specific “team” and not the company as a whole.

“Very good German and English language skills” (8 AZR 372/16)

The Federal Labour Court elaborated that the request for the applicant to have very good knowledge of the German and English language was an expression of entrepreneurial freedom and not discrimination because of ethnic origin. It was not evident that this requirement was a mere pretext and the demand for two languages counters an inseparable connection with a particular ethnic group. The Court referred to its ruling of 15 December 2016 (docket number 8 AZR 418/15) and clarified that the case would be different if the job advertisement was exclusively and directly related to a native language, e.g. “German as mother tongue”. The mother tongue is connected to a linguistic area and to the ethnic origin of the person. This is different to other language skills as they can be taught and be evaluated in tests.

Practical implications

These judgements demonstrate that although the applicant generally has a favourable burden of proof, unsubstantiated allegations cannot give rise to a presumption to the detriment of the employer. A job advertisement is interpreted according to its objective content, whereby the court will take into account what the average applicant is likely to understand. The employer can rely on this objective interpretation. To survive on the market the employer can stipulate professional requirements. As long as there is no evidence that the demand for specific qualifications is merely an excuse, this does not constitute discrimination, e.g. because of ethnic origin. However, employers should avoid asking applicants to have a specific “mother tongue” language.

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Current case law of the Federal Labour Court on forfeiture periods

Categories:

Employment contract, Minimum Wage, Standard contractual terms and conditions of employment

July 20, 2018

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In June 2018, the Federal Labour Court (Bundesarbeitsgericht, BAG) dealt intensively with forfeiture periods. The judgments addressed:

  • The date when the deadline starts to run (07 June 2018; docket number 8 AZR 96/17);
  • The suspension due to settlement negotiations (20 June 2018; docket number 5 AZR 262/17); and
  • The entitlement for statutory minimum wage during the period of incapacity for work despite forfeiture periods under tariffs (20 June 2018; docket number 5 AZR 377/17).

Start of the deadline run (8 AZR 96/17)

In this case, which concerned the disappearance of an unpaid car, the Court held that an employee could successfully invoke a contractual forfeiture period, meaning that all claims arising out of the employment were to expire within three months of their due date, unless they were previously asserted in writing against the other party. The Court ruled that the employer’s decision to sue the customer in court marks the beginning of the forfeiture period. In this case, nothing else could arise with regards to the employer’s duty to limit eventual damages as far as possible or the employer`s contractual accessory obligation, as in the absence of prospects of success, priority claims against the customer were not required.

Suspension of a forfeiture period due to settlement negotiations (5 AZR 262/17)

The Court stated that a forfeiture period due to settlement negotiations can be suspended under sec. 203 sent. 1 Civil Code (Bürgerliches Gesetzbuch, BGB), as long as the parties conduct pre-trial settlement negotiations. In addition, pursuant to sec. 209 Civil Code, the period during which the settlement negotiations take place, should not be included in the forfeiture period. In this case, the defendant rejected the claim, but stressed that he was willing to find a mutual solution.

Entitlement to statutory minimum wage despite tariff forfeiture period (5 AZR 377/17)

The Court also considered whether an employee would be entitled to continued remuneration where they are away from work due to sickness. The Court held that the entitlement to continued remuneration pursuant to sec. 3 para. 1 Continuation of Remuneration Act (Entgeltfortzahlungsgesetz, EFZG), in spite of its indispensability according to sec. 12 Continuation of Remuneration Act, may still be subject to a tariff forfeiture period. However, such a regulation will be ineffective under sec. 3 sent. 1 Act for the Regulation of a General Minimum Wage (Mindestlohngesetz, MiLoG), insofar as it also covers the statutory minimum wage, as the employee must be paid the statutory minimum wage during their incapacity to work.

Conclusion

The purpose of forfeiture periods is to provide the contractual partner with certainty as to when or whether he should expect further claims. Typically, it will be the employer who benefits from forfeiture periods as, in most cases, it is the employee who brings a claim against the employer. However, the ruling on the ‘start of the deadline run’ demonstrates that the employer must also ensure that (damage) claims are brought within the forfeiture period, ie. as soon as an objective view deems that some damage has occurred.

It still remains unclear whether forfeiture periods must expressly exclude statutory minimum wage claims in order to be effective. This long-awaited clarification was gallantly circumvented by the Federal Labour Court by calling on the suspension due to settlement negotiations. Also, the ruling on tariff forfeiture periods cannot be used in this respect, because tariff agreements are treated completely different than employment clauses. For the time being, employers should therefore include an express exemption for essential entitlements, such as the statutory minimum wage, in their forfeiture periods in order to avoid the entire forfeiture clause being null and void.

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