Severance package
Severance pay in Germany is called a one-off payment for the compensation of claims, particularly of a contractual relationship. The Austrian expression is clearance. Settlements are found in all continuing obligations, but especially in lease and sublease, service conditions (especially of directors of a GmbH or an AG board members ) and employment. But also other claims can be reconciled, for example, those damages.
Severance in German law
Regulated by law (apart from exceptions in labor ), only the agent compensation claim pursuant to § 89b of the HGB ( termination by the employer ), the loss of earnings damages to compensate (after termination of the contract ).
In the German labor severance pay is the one-time cash payment of the employer, is paid upon termination of employment. In Austria, the severance equal the clearance. Must be distinguished from compensation payments, such as maternity leave compensation pursuant to § 74 HGB are gem (due observance of a non-competition agreement ) and the claim for damages in cases of justified extraordinary termination of the employee. § 628 paragraph 2 BGB, which a claim for compensation pursuant to § 9 and § composed by the case law of the Federal Labour Court from a " Verfrühungsschaden " ( due to termination without termination of employment ), and possibly 10 Consumer Protection Act.
It is basically, apart from the following exceptions, no claim to compensation in the German labor.
In Germany compensation paid under
Only the compensation claims after 3 to 5 may be enforced under certain circumstances against the will of the employer.
Severance comparison
Because the Employment Protection Act aims of its legislative intention to the continuance of the employment relationship, where severance payments are not provided for the normal case. A dismissal process is associated with the risk for the employer, the employee continue to employ and need to pay compensation in accordance with the notice period expires. Therefore, very often closed after notice of dismissal out of court or in the court proceedings severance comparisons in which the effectiveness of the termination will be accepted and the employer promises a severance payment in return.
If such a compensation comparison instead of a termination in connection with a cancellation or dissolution of the contract agreed upon, and the employee has for the conclusion of such cancellation or termination contract a valid reason, it results in accordance with § 144 SGB III to an off-period for unemployment benefit. Even if the work parties a settlement after a termination by the employer agree, so -called workout agreement, this results due to the social court jurisdiction generally to a locking time when receipt of unemployment benefit.
The amount of compensation is generally based on the existing process risk in the event of a legal dispute. It is essentially determined usually by the quality of legal representation with. § 1a Consumer Protection Act provides for the amount of the settlement before half a gross monthly salary per year of employment, with a period of more than 6 months is counted as a whole year.
Legal regulation
Since 1 January 2004 sees the German labor employment protection law in § 1a Consumer Protection Act a severance payment to the worker if the employer has issued a neat layoffs. This compensation claim presupposes, however, that the employer in the necessary writing ( § 623 BGB) termination notice indicating that it is a compulsory redundancy and that the employee may claim the compensation upon the expiration of the three-week leave period for bringing proceedings. So this is actually not a legal claim, but continue a voluntary service of the employer.
According to § 23 Austrian Consumer Protection Act (Scope) the regulation of standing in the Consumer Protection Act § 1a severance does not apply to establishments with 10 or fewer employees (until 31 December 2003, five or less employees). Small businesses should be protected from untouchable financial consequences of a termination of a long year employed worker, which could at worst, endanger the existence of the employer himself. Workers in part-time or casual employment are counted in determining the '10 border workers ' with up to 20 hours working week with 0.5 and up to 30 hours working week with 0.75.
The employee has the choice whether he disregards an unfair dismissal claim and thus wants to claim the compensation or if he opted by bringing an action for the continuance and thus for the continued employment (or the action for tactical reasons rises because he hopes for - but at the risk that he can overrule continued employment at the end neither severance -, thereby to move the employer to a settlement that includes an even higher severance ).
Practical advantage of a settlement, pursuant to § 1a Consumer Protection Act is that the 12-week lockout time at the employment office for the unemployment benefit does not occur. This was indeed previously avoided by an enclosed outside the scope of this law settlement agreement (see cancellation agreement ); according to a recent decision of the Federal Social Court, but also introduces a three-week period for bringing actions within the agreed settlement contract ( consideration of the employee: waiver of unfair dismissal claim ) for the entry of a lock-up period. The Federal Social Court has announced in a decision of 12 July 2006, no longer hold on to this jurisdiction. A settlement or termination agreement therefore does not lead to the imposition of a restricted period if the termination agreement a legitimate employer termination is avoided. The legality of the threat of dismissal is presumed if the agreed compensation provided for in the Consumer Protection Act § 1a height ( 0.5 gross monthly salary per year of service ) does not exceed.
Resolution convicted of unacceptability of the continuation
Triumphs of workers in employment protection process it can, if the continuation of the employment relationship it is no longer reasonable, the Labour Court, a so-called resolution application filters ( § 9 Consumer Protection Act). Is the requirement of unreasonableness met, however, been interpreted restrictively by the Court, the Labour Court has (usually at the time of the expiry of the notice period ) to dissolve the employment contract and the employer be ordered to pay a lump sum ( amount of compensation § 10 Consumer Protection Act adjusted according to age and length of service: more than 12 to 18 salaries). In general, the labor courts are oriented in the ( rare ) Resolution judgments on the " rule of thumb " and make a resolution dependent on the fault of one side or another or charge. The resolution request may also provide the employer if there are reasons that do not allow a fruitful expect further cooperation. Even in the presence of this condition are high demands put on, so that the aimed by the Employment Protection Act of continuance is not undermined.
Entitlement to severance pay in collective agreements or social plans
See Some collective agreements (usually changes in operation as a result of rationalization ) compensation claims for the affected workers before, which must be paid regardless of the effectiveness of a termination of the collective agreement employees. The same applies for severance entitlements in social plans that are enforceable in workplaces with more than 20 employees in layoffs over certain thresholds (§ § 111 et seq WCA, for details see below: operational change, social plan ).
In the public sector is also the amount of compensation regulated by streamlining protect collective agreements of January 9, 1987, broken down by age and length of service.
Compensation for breach of collective codetermination law
Deviates by an employer of a balance of interests agreed with the works council ( § 111 WCA) without a compelling reason or if he tries not even or not seriously enough to reach an agreement with the works council on a balance of interests, so workers laid off as a result of co-determination, subject to operational change can be, the Labour Court under § 113 WCA, sue the employer for payment of severance pay the so-called compensation of disadvantages. The amount of such compensation is subject to the rules as they are to be observed during the dissolution judgment under § 10 Consumer Protection Act. The labor courts take into account in fixing the amount of the settlement in the rule that the employee may not already have a compensation claim from a social plan, they charge by the social compensation plan to the disadvantage of compensation.
Tax law
Severance benefits are fully taxable as wages. However, they are privileged under § 24 and § 34 of the Income Tax Act with the so-called fifth control by a milder progression. This privilege applies only if the severance accrues on a calendar year ( " aggregation principle"), and if the compensation is higher than the salary that would have flowed to the year at continuation of the employment relationship. If a severance payment in installments paid in several calendar years, it shall be subject to the full tax rate.
Social Security Law
Redundancy payments are exempt from social security. However, if a payment in a (preliminary continuing ) employment only declared as compensation, which is a particular form of contractual debts performance in truth, subject to such payment of social security contributions.