German labor law updates on disability protections and contract terminations

Recent legal developments in Germany highlight critical protections and limitations regarding employment termination.

In matters involving employees with severe disabilities, employers are generally required under § 168 SGB IX to obtain prior approval from the relevant Integration Office (Integrationsamt) before issuing a dismissal. This requirement applies to both ordinary and extraordinary terminations. If an employer fails to secure this approval before the dismissal is declared, the termination may be deemed legally invalid if the employee files a timely protection against dismissal lawsuit.

Separately, the Federal Labour Court (Bundesarbeitsgericht) has overturned a significant ruling regarding fixed-term employment contracts. The court addressed a case where a former executive had resigned shortly after starting a new role. A lower court had previously ruled that the employee was obligated to continue providing services to the former employer until 2027 and refrain from other primary employment. The Federal Labour Court overturned this decision, rejecting the employer's appeal and addressing the legality of long-term contractual bindings that attempt to restrict an employee's ability to resign.