In an employment contract are formulated the rights and obligations of a working relationship between employer and employee.
The following points are important parts of an employment contract:
- What? – Description of the tasks which the employer can assign to the employee
- Where? – Definition of the place where the employee would work
- When? – Determination of the working time of the worker
- How long? – Information on the periods of notice and, possibly, on the expiration of the employment contract.
The employment contract is also subject to statutory, business and, where applicable, tariff regulations.
Have your employment contract examined by a lawyer; if you are an employer, make sure to let an attorney design your employment contracts for you! Existing employment contracts should also be regularly reviewed and updated or harmonized.
In the event of a contractual termination, employees and employers shall terminate the employment contract by mutual agreement. Advantage: The consequences of a termination procedure can be avoided.
The annulment is sealed by a cancellation agreement (“Aufhebungsvertrag” in German).
The employee should be informed of the consequences before the signing of the termination agreement.
Make sure that you do not have any disadvantages by signing the termination contract! Preventive consultation with an attorney will save you from very unexpected and unwanted consequences.
Consequences of a cancellation agreement
- The statutory period of notice is no longer applicable.
- The employee has to forego social security benefits. For instance, the unemployment office pays the unemployment benefit only after a period of three months, if the employee is still unemployed after the termination of the previous contract. It should therefore ensure that the lost social insurance benefits in the cancellation contract are balanced.
- The employee can negotiate a severance pay.
- In the case of older workers, the employer may have to reimburse the unemployment benefit to be paid by the employee. The employer can be exempted from this obligation by the termination agreement.
Let us advise you in how to win your contract partner with a fair offer for a cancellation contract.
Terminating an employment contract can be regulated by an ordinary or an extraordinary termination.
If the employer or the employee wants to withdraw from the employment contract before the period of notice, the following possibilities have to be taken into consideration:
- Exemption from work
- Termination without notice
Please make sure to contact a lawyer in order to be perfectly aware of your choices, to be prepared for the consequences and to know exactly the advantages and disadvantages of your decision.