...especially in start-ups, important requirements are often not met
Dismissals and collective redundancies are complex issues, especially in the dynamic world of startups. This article provides an overview of how you can protect your rights as an employee and what often goes wrong.
Why are many terminations in start-ups legally invalid?
Employment law experts point out that the majority of terminations in start-ups are legally contestable due to inadequate preparation and incorrect implementation. Many of these dismissals are made on an ad hoc basis without fulfilling the legal requirements necessary for an effective dismissal. For example, companies must be able to prove that jobs actually have to be cut due to operational necessities and that no other jobs are available for the employees concerned.
What legal requirements must be observed in the event of termination?
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Authorization to sign: A letter of termination must be signed by an authorized person.
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Written form: The letter of termination must be signed by hand.
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Delivery: Correct delivery of the notice of termination is essential. This can be done by personal delivery or by documented posting.
Is there a right to severance pay in the event of dismissal?
Severance pay is not automatically provided, but many start-ups offer it to avoid potential legal disputes. If no severance pay is offered, it is advisable to file an action for unfair dismissal within three weeks of the dismissal in order to defend your rights. Without a timely complaint, the dismissal will be considered effective.
How is the severance payment calculated?
The amount of severance pay is a matter of negotiation and is often calculated using the formula of half a month's salary per year of employment. In start-ups, where the period of employment is often shorter, severance payments can vary and are often between one and four months' gross salary.
Role of the works council in dismissals
If a works council exists, which is often not the case for start-ups, it must be informed and consulted before dismissals are made. Although the works council cannot stop the dismissal directly, it plays an important advisory role and supports the protection of employee rights.
What happens to employee shares after a termination?
In many start-ups, employees lose their entitlement to shares (ESOP) if they leave the company before the end of the vesting period, which is often two years. Only fully acquired shares are retained after termination.
Conclusion
It is crucial that you as a startup employee know your rights and seek legal support when needed. Knowing the legal requirements and responding quickly to dismissals can be instrumental in effectively enforcing your claims.
Sources:
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Lisa Ksienrzyk (Gründerszene, 2024): „Hohe Fehlerquote bei Kündigungen in Startups: So sichern Sie Ihre Rechte“
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Verena Weber, Lena Schomann (Grant Thornton, 2024): „Wirksam kündigen: Worauf Unternehmen achten müssen“
