Employment contract: notice of dismissal and workers' rights

23 July 2025

Unexpectedly receiving a notice of dismissal is always stressful. It is all the more frustrating when the *Kündigung* is issued with procedural flaws, which some employers exploit, taking advantage of the fact that employees do not know and do not stand up for their rights. According to the Federal Statistical Office, in 2020 the labour courts accepted 206,163 claims, challenging their dismissal. A significant proportion ended in the employee's favour (via a settlement agreement) or with a compensation payout – meaning employer errors are more common than it seems.

If an employee knows how the time limits (§ 622 BGB) and procedures (§ 623 BGB) work, they can challenge an unlawful dismissal, protect their job or receive fair compensation.

In the article, we examine such an unpleasant matter as receiving a notice of dismissal in Germany, the notice periods and rules for dismissal, and what rights an employee has in this case.

Which laws govern the dismissal of employees in Germany

The legal basis consists of the Civil Code (BGB – which determines notice periods) and the Dismissal Protection Act (KSchG – which determines grounds), along with special acts for specific categories of employees (MuSchG, SGB IX, BetrVG, BBiG). The employer is obliged to justify the dismissal, whereas the employee merely needs to comply with the general notice periods or cite a serious reason.

Legal framework for dismissal

Section 622 of the German Civil Code (BGB)— sets standard notice periods.
 Section 626 of the BGB— regulates early termination for both parties: should anything happen—for something serious (such as theft, non-payment of wages, etc.), employment relations can be terminated immediately.
Protection Against Dismissal Act— requires the employer to prove to the court that the dismissal is genuinely necessary for economic reasons, behavioural issues or personal reasons concerning the employee, i.e. «socially» justified. “Works” only after 6 months of service and with a staff of more than 10 employees.
Section 17 of the Maternity Protection Act (MuSchG)— protects the rights of pregnant women and parents on parental leave and requires consent for dismissal to be obtained from the supervisory authority.
SGB IX Section 168— protection of severely disabled people. Before dismissal, the approval of the Integrationsamt must be obtained.
Shop Constitution Act Section 103and Section 15 of the Protection Against Dismissal Act (KSchG)— grants immunity to members of the works council of the enterprise for the duration of their election and for 1 year afterwards (Betriebsrat).
Vocational Training Act Section 22— describes specific rules for the dismissal of apprentices/trainees by the employer. During the probationary period, employment can be terminated on any day, and later only for a valid reason or with a 4-week notice period.

Notice periods

For the dismissal to be considered lawful, both parties to the process must observe the notice periods for dismissal.

Employer → employee

Section 622 paragraph 2 of the Civil Code specifies a notice period for dismissal ranging from 4 weeks to 7 months, taking into account length of service.

The longer an employee has worked at the company, the longer the notice period that must be observed for termination in Germany:

Service of under 2 years: 4 weeks' notice and dismissal by the 15th or the last day of the month.
Length of service ≥ 2 years: notification from 1 to 7 months and termination only at the end of the calendar month.

For example: The employee has worked for 6 years. This means the notice period must be 2 months. And, if they were informed about the dismissal on 10 April, they can only be dismissed on 30 June.

And now in more detail about the notice periods for dismissal depending on the length of service with the company.

Continuous service with the employer	Minimum term Warnings
from 0 to 6 months	2 weeks. Employment can be terminated on any day.
from 7 months to 2 years	4 weeks
2 years	1 month
5 years	2 months
8 years	3 months
10 years	4 months
12 years old	5 months
15 years old	6 months
20 years	7 months

If you have a Rechtsschutzversicherung, a lawyer can advise whether a «trap» with an extended deadline is hidden in the contract.

Employee → employer

The same standard is set for the employee — 4 weeks (Section 622(1) of the Civil Code (BGB)The contract cannot establish a notice period for the employee that is longer than that for the company. This means that, without a valid reason, an employee cannot leave «same-day».

Exceptions and special deadlines

Probationary period
During the probationary period (which cannot exceed 6 months), the notice period from the date of serving the notice until dismissal is only 2 weeks for both the employee and the employer.

Important reasons
Where there are important reasonsSection 626 of the Civil Code (BGB)) dismissal/resignation can take effect immediately. Both parties have a mere 2 weeks to process the dismissal after the valid reason becomes known. Otherwise, the right to summary dismissal is lost.

Redundancies
When terminating a large number of contracts, the employer is obliged to notify the Agentur für Arbeit (Section 17 KSchG). After this, a 1-month waiting period applies (Section 18(1)), during which time it is forbidden to issue personal redundancy notices, unless the agency itself shortens the period.

Grounds for dismissal at the employer's initiative

Standard dismissal after 6 months of service (KSchG)

Section 1 KSchG splits the causes into:

Economic - staff reduction, closure of departments, reduction in the number of orders;
Behavioural – systematic violations, truancy, regular lateness;
Personal – loss of the right to drive vehicles for a driver, prolonged incapacity for work with no prospect of improvement.

Before dismissing an employee, the company is obliged to investigate alternatives (transfer to another department or unit, reduced working hours), take into account length of service, age, dependants, disability and document the decision in writing. An electronic signature and/or e-mail are not sufficient (§ 623 BGB). This applies to businesses with a staff of more than 10 people.

If there are fewer than 10 employees, the employer may not have to comply with the “social justification” for dismissal (proving economic, behavioural, or personal reasons for the dismissal). Instead, they only need to comply with the dismissal notice periods and issue the notice in writing.

As practice shows, if an employee has legal expenses insurance – Berufsrechtsschutz – employers often find it easier to reach an agreement and pay a severance package or compensation rather than waste time on a drawn-out legal process with a solicitor.

Already at this stage, it is useful to check your Rechtsschutz policy so that the insurance company can confirm which lawyer and expert fees it will cover. This immediately shifts the balance of power in negotiations.

Summary dismissal

Section 626 of the BGB permits instant dismissal for gross misconduct: theft, violence, forgery, sabotage. The employer must hear the employee and the works council and issue the notice of dismissal within two weeks of establishing the facts. This protects companies from suffering serious harm, but requires compliance with a high standard of proof. Otherwise, any formal error will lead to the dismissal being declared invalid.

Dismissal of dishonest employees

Dismissal for a criminal offence

If an employee commits a criminal offence under the penal code (theft, fraud, forgery, violence), the intentional violation of the law and such a serious misdemeanour shall entail immediate dismissal. It is important that the employer announces the dismissal within two weeks of becoming aware of the misdemeanour (§ 626 BGB).

Dismissal of a persistent offender

Persistent offenders will not be able to use legal expenses insurance in employment disputes. If a person systematically skips work or ignores instructions, they will be dismissed, and the law is on the employer's side here. If behaviour does not change after a written warning, dismissal takes place without a notice period (§626 BGB).

Dismissal of a slacking employee

In the event that an employee knowingly and repeatedly violates their job duties, dismissal without observing notice periods (§ 626 BGB) also applies. However, the employer is obliged to issue a warning to the employee beforehand.

Additional procedural requirements

The Kündigung must be in writing with a wet-ink signature (§ 623 BGB). An email or scan is invalid. The employer must notify the Betriebsrat in writing with a statement of reasons, otherwise the Kündigung is also void (§ 102 BetrVG). A breach of form means the employee wins in court in the event of a dispute.

Grounds for dismissal at the employee's initiative

An employee can terminate an employment contract «normally» by giving four weeks' notice (§ 622 I BGB) or immediately on urgent grounds under § 626 BGB—if there is a threat to health, non-payment of salary, or severe insults. In this case, they also have two weeks to react after the incident and are obliged to document the grounds (a doctor's note, proof of salary delays, internal memos, correspondence). The advantage in this situation is the ability to leave a toxic environment quickly; the disadvantage is that they will have to explain themselves to the Arbeitsagentur, otherwise there is a risk of benefit suspension.

During the probationary period, an employee can give two weeks' notice of resignation (§ 622 III BGB).

Even in the case of a voluntary resignation, legal expenses insurance can be useful: a lawyer will check the terms and deadlines of the dismissal and whether they have been complied with.

More about legal protection insurance

Read

Who can and cannot be dismissed – special protection

Dismissal of pregnant women or parents on parental leave – Section 17 MuSchG

During pregnancy, there is special protection against dismissalSection 17 of the Maternity Protection Actfrom the first day of pregnancy until four months after the birth of the child. Protection against dismissal after the birth of a child does not depend on whether you want to return to work afterwards or decide to take parental leave. In order for these rules to take effect, you must inform your employer about the pregnancy. Furthermore, dismissal is only possible with the permission of the special authority, the Aufsichtsbehörde für Arbeitsschutz (Occupational Health and Safety Inspectorate).

If the employer dismisses the employee without knowing about the pregnancy, within two weeks of receiving the notice of dismissal the employee must inform them of it (the onset of pregnancy).

During the child-rearing period, dismissal at the employer's initiative is possible only with the permission of the supervisory authority and solely in exceptional cases (serious misconduct, liquidation of the company).

Protection against dismissal comes into effect (Section 18 of the Youth Protection Act):

if the child is under three years of age, then 8 weeks before the start of parental leave;
if the child is aged between 3 and 8, then 14 weeks before the start of parental leave.

The protection against dismissal is coming to an end with the expiration of parental leave.

People with severe disabilities – Section 168 SGB IX

With a disability rating of 50 or higher, a person is classified as severely disabled and their dismissal is only possible after notifying the works council and obtaining approval from the integration office (Integrationsamt).Section 168 of the Ninth Book of the Social Code (SGB IX)).

Departmental authorisation is not required if:

the employer and employee have signed a mutual termination agreement
the employee has worked at the company for less than 6 months
the fixed-term contract has expired

If the integration office has not replied within 1 month, it is considered that consent has been obtained and the notice period for standard dismissal is 4 weeks. In urgent dismissal — 2 weeks.

Members of the Works Council – Section 15 of the Dismissal Protection Act (KSchG) / Sections 102-103 of the Works Constitution Act (BetrVG)

For the duration of the election and one year afterwards—virtually complete «armour» (Section 15 KSchG and Section 102 to 103 of the Works Constitution Actdismissal is only possible upon closure of the company, by court decision, or with the consent of the Betriebsrat and Arbeitsgericht. The advantage is the guarantee of the independence of trade union work; the disadvantage is obvious — the risk of abuse by employees.

Apprentices and trainees – Sections 20, 22 BBiG

During the probationary period — termination is same-day. Trainees have a probationary period: no less than 1 and no more than 4 months. It must be clearly stated in the training contract. During this time, dismissal can happen at any time without explanation. This must be done in writing.

Following the end of the probationary period, the employer can only dismiss a trainee for a valid reason (serious breach of employment duties, theft, systematic absenteeism). The dismissal comes into effect immediately (Section 20 BBiG).

A standard dismissal of a trainee after the probationary period is prohibited for the employerSection 22 BBiG).

Also, the employer and the intern may conclude a termination agreement. It enters into force immediately.

Employee's rights upon dismissal

The right to challenge dismissal

Important: Unfair dismissal can only be challenged within 3 weeks of receiving written notice.

An employee can claim that the dismissal is unfair. To do this, within three weeks of receiving written notice of dismissal, they must file a claim (Kündigungsschutzklage) with the employment tribunal (Arbeitsgericht) where their place of work is locatedSection 4 of the Protection Against Dismissal Act (KSchG)). This right can be exercised by an employee who has been dismissed by their employer. And this time limit does not apply if the dismissal is arranged by mutual agreement (Aufhebungsvertrag).

If the employee does not exercise this right, the dismissal will automatically take effect. At that point, it will no longer matter whether it was justified or unjustified.

Useful tip:

Be careful about signing a termination by mutual agreement – mutual termination agreement. The agreement lacks a notice period, dismissal protection and trade union protection. This means that termination by mutual agreement can be carried out with immediate effect, cannot be contested as unlawful and deprives you of the opportunity to apply for ALG I unemployment benefit.

If your employer offers you a settlement agreement to terminate your employment contract, do not yield to pressure. No one can force you to sign such an agreement. As an employee, you have a say in the decision to terminate the employment relationship.

If the dismissal notice is already in your mailbox and you are not there (on holiday or off sick, for example), it will still be considered delivered and the countdown starts from that very moment.

If a situation arises where an employee, through no fault of their own, misses the initial three weeks for filing a claim to challenge a dismissal, they have another two weeks after the removal of the reason to ask the court to allow the missed claim for consideration. However, this must be no later than within a period of up to 6 months from the end of the missed 3-week period (Section 5 KSchG). This may be done under 100% on the grounds of a proven insurmountable cause (illness; major surgery; coma; accident; force majeure; isolation without communication), subject to the specified time limits.

Right to redundancy pay

An employee is not always entitled to severance pay. It applies if such a payment was provided for in the employment contract or if the employer wants to persuade the employee not to file a claim for wrongful dismissal.

Reading your employment contract before signing is also useful from the perspective that employers are ready to include any absurd clauses in it that will allow them to legally dismiss an employee, for example, for:

Charging a personal device (electric shaver) in a company socket. Since this happened regularly and the employee ignored warnings, dismissal was not long in coming. The company treated this as theft of electricity. This case can also be interpreted as a ban on charging personal phones in the company office;
Call centres may ban personal calls during working hours, as this breaches customer data confidentiality;
If electronic working time tracking has been introduced at a company, even a trip to the toilet without logging it in the system can be regarded as the falsification of records.

Practical tips

We recommend to the employer: document violations before issuing a formal warning (Abmahnung); discuss alternatives (transfer, short-time working) and obtain the opinion of the works council (Betriebsrat).

It is very important for the employee to: keep the contract and all letters, register with the Arbeitsagentur within 3 days of finding out that they are going to be dismissed, and file a Kündigungsschutzklage within 3 weeks if they doubt the legality of the dismissal.

Resolving disputes with an employer in Germany

As an employee, you invariably enter into an employment relationship with your employer. This relationship may end in a dismissal, with which you may not always agree. If your position has a legal basis, you can defend your rights in court. Legal expenses insurance in this case:

protects you from sudden expenses for an employment dispute in court (payment of court fees, lawyer's fees, experts or mediators). This is a financial “safety net”;
it reduces the stress of an unpleasant, unforeseen situation when you have to stand up for your rights against an unequal opponent;
increases your chances of a peaceful settlement with your employer without taking the matter to court. Acts as a negotiating lever.

How legal expenses insurance works in the event of dismissal

In the event of employment disputes with your employer regarding dismissal, legal expenses insurance with the Berufsrechtsschutz module will provide you with:

initial telephone consultation (with most large companies) with a lawyer, who will explain your rights;
plan of action and your next steps;
payment of legal costs;
In the event of dismissal during temporary part-time employment, you have the same rights as permanent employees. Legal costs will be covered and there is the opportunity to resolve the dispute out of court;
If dismissal occurs during the probationary period, legal expenses insurance will cover the legal costs for an initial legal consultation, you will be supported in negotiations with your employer, and you will receive assistance with recovering arrears of salary or holiday pay.

As soon as you have received your notice of termination, you call the insurance company and provide your policy number and the nature of the issue. The insurance company takes time to review your claim to confirm that your case is covered. Next, they may offer you a list of partner solicitors or you can choose a lawyer yourself.

How to choose occupational legal protection insurance

When choosing legal expenses insurance with a professional liability (Berufsrechtsschutz) module, pay attention to these important points:

The waiting period is the time from the inception date when your insurance comes into effect. This means that if you take out insurance on 1 March, you will be able to use it after 1 June. Disputes, dismissals, and cases already in court before 1 June are not insured events and will not be paid out.
You can take out this insurance if you are an employee. This type of insurance is not available to the self-employed and company directors.
The excess is the amount you pay yourself, with the insurance company paying the difference. Choosing an excess affects the cost of the insurance and reduces the premium. With a zero excess, the cost of insurance will be at its highest. Usually, the excess is 150-300-500 euros.
For many insurers, the initial telephone consultation is free.
Payment for the insured event is made within the terms of your agreement.
If there is an option to choose unlimited employment dispute cover, choose it. Alternatively, look at policies with cover starting from €300,000.
When working abroad and on business trips, you need worldwide cover.
The insurance company's rating and reliability affect the processing speed of claims and payouts without delays.
Cancellation at the insurer's discretion is possible if you have had multiple insurance claims during the year and this is stipulated in the contract.

Conclusion

Adherence to deadlines (§ 622 BGB) and form (§ 623 BGB) is the «technical minimum» without which any substantive arguments are useless. The employer wins if they document the process and consult in advance; the employee wins if they seek advice quickly and do not miss the 3-week limitation period for filing a claim. Ultimately, the strict rules make the German labour market less flexible, but allow both parties to plan for the future without surprises.

In summary, dismissal procedures in Germany are regulated in detail—ranging from basic notice periods to special protection for pregnant women, disabled individuals, or members of the works council. Understanding these rules, along with having legal expenses insurance with an employment law module (Berufsrechtsschutz) in place ahead of time, turns even an unexpected dismissal from a financial shock into a manageable procedure where the employee has a clear action plan, legal support, and a realistic chance of keeping or receiving a fair payout for their job.

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