Protection Against Unfair Dismissal

The right of the employer to terminate employment contracts
without cause (“ordinary termination”) is severely restricted
by the Protection Against Unfair Dismissal Act (Kündigungs-
schutzgesetz – KSchG). In general, it applies to all employees
who have worked for the employer for more than six months,
provided the employer employs more than fve employees
or more than 10 employees if the employee were hired after
December 31 2003.

A discretionary termination of an employment contract with an
employee covered by the Protection Against Unfair Dismissal
Act is ineffective unless the employer can prove that the termi-
nation is “socially justifed”. As a rule, “social justifcation” is
deemed to exist only if the termination is occasioned by reasons
relating to the person or the behavior of the employee or by
compelling business reasons that prevent the continuation of
the employment.

In case of a termination based on compelling
business reasons the employee to be dismissed must be
selected from a pool of comparable employees based on social
criteria (i.e. Age, family situation, years of employment, severe
disabilities).