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No obligation to offer employment abroad in case of dismissal

The employer’s obligation to offer an alternative job to an employee to avoid termination of the employment relationship does not include any obligation to offer a transfer to a foreign branch or overseas operations of the company. 

The defendant runs a textile company in Germany. It also runs a permanent production facility in Czech Republic. The claimant had been employed at the main production facility in Germany since 1984. In 2011 the defendant decided to move the entire production to Czech Republic and close the production facility in Germany altogether, keeping only office and management functions in Germany. The employment relationship between the claimant and the defendant was terminated due to operational reasons. 

The claimant filed a lawsuit claiming that a dismissal for variation of contract would have been possible instead of her unconditional dismissal. She argued that, although there was no alternative job position available in Germany that fit her qualifications, she could have been transferred to the Czech Republic instead. 

The Federal Labour Court (Bundesarbeitsgericht) rejected the claim (BAG 29.08.2013 – 2 AZR 809/12). It argued that a possible claim for the offer of an alternative job position is limited to national operations but does not include jobs in foreign operations in a company, even if the job descriptions are identical to the jobs that were made redundant. 

The decision is of high importance when dealing with international groups and businesses. If the Federal Labour Court upholds its jurisdiction, this opens many options for international groups to terminate national employment relationships when transferring operations to other affiliated companies or branches abroad without the obligation of transferring employees to other comparable positions.