BAG weighs in on deadline for summary dismissal amidst compliance investigations

News  >  BAG weighs in on deadline for summary dismissal amidst compliance investigations

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Germany’s Federal Labor Court – the Bundesarbeitsgericht (BAG) – has stated that an employer is still entitled, subject to certain conditions, to issue an employee with a summary dismissal notice even after the two-week deadline has passed.

The country’s labor laws require the employer – or an authorized person within the company – to give notice of summary dismissal within two weeks of becoming aware of the relevant grounds for dismissal. After this deadline has passed, it is generally no longer possible to issue a valid dismissal notice of this kind, explains commercial law firm and expert adviser to employers, MTR Legal Rechtsanwälte. There are, however, exceptions to this rule. Case in point: a ruling of the Bundesarbeitsgericht from May 5, 2022 (case ref.: 2 AZR 483/21).

The proceedings before the BAG were the result of a sales manager violating the compliance rules in place at his company. Despite this constituting sufficient grounds for summary dismissal, management at the company wanted to take a closer look into the matter before taking this final step. To this end, they set up a compliance team that carried out extensive investigations. These took some time, with management receiving the preliminary report after 11 months. Ten days later, they issued the sales manager with a summary dismissal notice.

The latter’s action for wrongful dismissal, having found favor with both lower instance courts, ultimately came before the BAG, which concluded that the summary dismissal notice had been issued in a timely and valid manner.

In justifying its decision, the Court clarified that the two-week notice period had not begun until management was presented with the investigation report, as this is what enabled the employer to evaluate the violation and to weigh up the arguments for and against dismissal in this case. The BAG went on to state that the outcome would only have been different if the employer had avoided becoming aware of the facts relevant to the dismissal in bad faith. This was found not to be the case here, particularly given the establishment of a compliance team and the submission of an interim report.

MTR Legal Rechtsanwälte advises on a wide range of issues related to labor and employment law.

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