Issue – Coronavirus-induced short-time working
The legal action was brought by an employee (A) who had been working in the social services and care division for an operator (B). Following the temporary closure of the kindergartens and day nurseries, in mid-March 2020, B notified the Federal Employment Agency of the worker inactivity at her enterprise. The Federal Employment Agency authorised the short-time working allowance retroactively to 1.4.2020. However, A withheld permission for the introduction of short-time working. On 22.4.2020, B terminated employment without notice and with the alternative of ordinary dismissal with the option of altered employment conditions as of 31.7.2020. The aim was for B to be entitled to impose short-time working for the period from 18.5.2020 until probably 31.12.2020 provided that there was considerable worker inactivity and all the other preconditions for entitlement to the short-time working allowance being granted – in accordance with Section 95 ff. of Volume III of the German Social Security Code (Sozialgesetzbuch, SGB) – had been satisfied.
Pre-conditions for and processing of the imposition of short-time working
If neither the employment contracts nor the current works agreements or collective agreements – that are applicable to the employment relationship – put on record that short-time working is possible and may be imposed by the employer then the employees’ contractual permission is required in addition. If employees do not consent to short-time working then the employer is basically obliged to continue paying the employees the (full) amount of their contractually agreed remuneration for their work.
An alternative to the requisite consent is the dismissal with the option of altered employment conditions according to which continued employment under new and altered conditions is offered at the same time as the previous employment relationship is terminated. This gives the employee the option of leaving the enterprise entirely or, alternatively, continuing to work under altered conditions. In view of the notice periods that have to be observed – which in some cases can be several months -, for the introduction of short-time working ordinary dismissal with the option of altered employment makes little practical sense however. Dismissal without notice but with the option of altered employment conditions would provide a remedy in such circumstances; however, the previous much more stringent requirements would also have to be satisfied.
The decision of the Stuttgart labour court
The Stuttgart labour court, in its ruling from 22.10.2020 (case reference: 11 Ca 2950/20), expressly accepted, for the first time, the justification for dismissal without notice but with the option of altered employment conditions with the introduction of short-time working. The justification for dismissal without notice but with the option of altered employment requires:
- a notice period to be observed for the start of shorttime working (here: three weeks was adequate);
- a proper selection based on social criteria from among the employees who could be considered (i.e., the conditions for a short-time working allowance being granted in accordance with the SGB III are also present in each case in the person of the employee);
- a limit on the duration of the short-time working;
- the absence of milder methods (in particular, proof is necessary that an attempt was made prior to the dismissal to achieve an individual agreement with the employees).
Please note: It should be borne in mind that this labour court decision is not yet legally binding and we will have to wait and see if the competent state labour court, as the appellate court and, potentially, the Federal Labour Court will affirm the ruling.