A valid dismissal for operational reasons does not require a prior offer to continue employment abroad

While dismissals for operational reasons in Germany generally require an employer to review whether there are vacant positions that the employee may be assigned, this obligation generally does not extend to vacant positions abroad. This principle has now been reconfirmed by the Federal Labour Court (Bundesarbeitsgericht, BAG, judgment dated 24 September 2015, docket number 2 AZR 3/14).

The employer was a Turkish bank with several branches in Germany. The plaintiff had been employed by the bank as a branch manager of a German location. As the bank had decided to cease operations in Germany, it instructed the employee to work as a department manager in a Turkish branch office. The employee refused to work in Turkey. After the bank had issued written formal warnings due to the employee’s refusal, they terminated the employment relationship. The employee now argued that the bank would have been obliged to offer him the job as the branch manager of a Turkish branch office.

While the Federal Labour Court was doubtful whether the bank had been allowed to validly instruct the employee to work as a department head in Turkey, it held that the bank had not been obliged to offer him the position as a branch manager of a Turkish branch location. Generally, the obligation to offer a vacant position did not extend to operations abroad. According to the court, the bank also had not created any obligation itself to offer alternative employment abroad. As the employee had openly refused to work in Turkey, there was no indication that he would accept the position as a branch manager there if offered in the form of a dismissal combined with the offer of continued employment under altered conditions. The court also held that the termination neither contradicted the bank’s previous behavior nor was it issued in bad faith. While the bank had offered employment abroad, the court found no legitimate reason for the employee to believe that the bank would not exercise its right to dismiss the employee for operational reasons.