Cancellation rarely without pitfalls - How to cancel correctly

Dismissals are one of the most legally challenging issues in labour law. In practice, it has been shown time and again that even minor errors can lead to a termination being invalid - with considerable economic and organisational consequences for the company.

It is therefore crucial for employers to not only prepare notices of termination in a formally correct manner, but also in a strategically well thought-out manner. A clear structure and a clear understanding of the legal requirements help to avoid typical pitfalls.

Why cancellations often fail

Terminations often fail not because of a single serious error, but because of a combination of formal and substantive weaknesses. Typical causes are

• Wrong choice of cancellation method 
• insufficient or unsustainable grounds for termination 
• Errors in the involvement of the works council 
• Problems with receipt of the cancellation 

In addition, labour court proceedings often end in favour of employees if there are uncertainties or ambiguities. Employers should therefore proceed with particular care.

Choose the right type of cancellation

Choosing the right type of cancellation is the first and decisive step.

Ordinary cancellation

Ordinary dismissal takes place in compliance with the applicable notice periods. It is the rule and requires a socially justified reason for dismissal, particularly in the area of application of the German Protection against Dismissal Act.

Extraordinary cancellation

Extraordinary termination (without notice) can only be considered in exceptional cases, for example in the event of serious breaches of duty. It requires good cause and must generally be given within two weeks of becoming aware of the reason for termination.

Change notice

The purpose of a notice of termination is to continue the employment relationship under changed conditions. It is particularly relevant if existing contractual conditions are to be adjusted, for example in the event of organisational changes.

The right reason for cancellation 

In addition to the type of dismissal, the reason for dismissal is central. Within the scope of application of the Dismissal Protection Act, the dismissal must be socially justified.

A distinction is made between:

• dismissals for behavioural reasons (e.g. breaches of duty) 
• dismissals for personal reasons (e.g. illness) 
• dismissals for operational reasons (e.g. loss of the workplace) 

In practice, it is crucial that the reason for termination is documented in a comprehensible manner and can be proven in the event of a dispute. A warning is often required beforehand, particularly in the case of dismissals for behavioural reasons.

Involvement of the works council

If there is a works council, it must be consulted before any dismissal.
Failure to hold a hearing leads to invalidity.

More information on the tasks and participation levels of the works council can be found here:

The works council in the company

Form and access

Cancellations must:

• be made in writing 
• to the employee 

Access errors are a common practical mistake.

After the cancellation 

Even after the notice of termination has been issued, there are still important obligations and requirements for action.

Exemption

Employers can release employees from work under certain conditions, for example to avoid conflicts or to protect company interests.

Remaining holiday

Outstanding holiday entitlements must be taken into account - either by granting them during the notice period or by compensating them.

Prepare certificate

Employees are entitled to a qualified reference, which should be issued in good time.

Read here what you need to bear in mind when writing an employment reference:

reference without dispute

Return of company property

Documents, devices or access data must be returned and access terminated.

Conclusion

Terminations require a structured approach and a good understanding of the legal requirements. Those who prepare notices of termination carefully, document them properly and adhere to the formal requirements significantly reduce the risk of invalidity.

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If you have any questions on this or other topics, please contact us - we will be happy to advise you.

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