Every employer has certainly experienced this situation at some time or other: a notice of termination is issued, against which the employee brings an action for protection against dismissal. After lengthy proceedings for protection against dismissal, possibly involving two courts, a final decision is made that the dismissal was invalid. The employee then – or even during the unfair dismissal proceedings – claims compensation for the period after the expiry of the notice period until the final decision, the so-called default of acceptance wage. This is the worst-case scenario for the employer, as not only do they have to continue employing the employee, but also face considerable back payments. In this case, the employer generally cannot invoke the absence of formal requirements, because after an invalid termination, neither an offer of work performance is required nor must an assertion be made within any preclusion periods, since both are deemed to have already taken place through the filing of the action for protection against dismissal.
No automatic obligation: case scenarios in practice
The good news for the employer in these cases, however, is that there is no automatic obligation to pay the full amount of the default of acceptance wage. The relevant provision here is § 11 of the German Dismissal Protection Act (KSchG), which is almost identical in wording, or at least identical in content, to Section 615 sentence 2 of the German Civil Code (Bügerliches Gesetzbuch – BGB). If it is known that the employee has performed other work for another employer during the course of the unfair dismissal proceedings, § 11 (1) KSchG provides for this other income to be offset against the default of acceptance wage. But the cases in which the employee does not perform any other work during the course of the unfair dismissal proceedings are particularly interesting. Here, it is possible to invoke the provision of § 11 ((2) of the German Unfair Dismissals Act (Kündigungsschutzgesetz – KSchG), according to which the employee must have the value of what they could have earned if, had they not maliciously failed to accept work that they could reasonably have been expected to do, credited to them. According to the case law of the Federal Labor Court (Bundesarbeitsgericht – BAG), it cannot be derived from this provision that the employee may in any case wait for a reasonable offer that is personally “suitable” for them. If it is not a question of a job opportunity with the previous employer, the employee may not remain inactive if a realistic job opportunity is offered to them.
Employer has for information a claim against the employee
The dilemma faced by the employer in such a case is that they are basically burdened with presenting and proving the existence of the malicious omission of the acceptance of other employment. However, since the employer usually has no knowledge of what the employee did or did not do during the course of the proceedings for protection against dismissal, and since there are also no possibilities for further clarification of the facts, the employee has a so-called secondary burden of proof, since it is readily possible and reasonable for the employee to provide more detailed information in this regard. In this respect, the employer has a claim against the employee for information about the placement proposals submitted by the Federal Employment Agency resulting from the secondary obligation arising from the employment relationship pursuant to § 242 of the German Civil Code. According to case law, this information must include details of the activity, working hours, place of work and remuneration. The case law justifies the existence of this right to information with the fact that the employer is only in a position to present indications of the reasonableness of the work and a possible maliciousness of the acceptance of other employment if they are aware of the working conditions of the proposed placements. Subsequently, it is incumbent on the employee, by way of the graduated burden of presentation and proof, to counter these indications and to explain why a contract was not concluded or why concluding such a contract was unreasonable. The case law has left open whether the employee’s duty to provide information also extends to the employee’s own efforts. In this case, however, nothing else can apply than with regard to the right to information about the placements proposed by the Federal Employment Agency.
Employers are therefore well advised to assert corresponding claims for information against the employee, as this can already lead to a deterioration of the employee’s chances in the lawsuit for the default of acceptance wage. If the employee does not provide information, or does not provide it in full, the claim for default of acceptance wage will be unfounded until the information has been provided in full and there is no evidence that the employee has maliciously failed to accept other employment.
Recent decision of the Berlin-Brandenburg Higher Labor Court
In a decision of 30 September 2022 – 6 Sa 280/22 – the Berlin-Brandenburg Higher Labor Court (Landesarbeitsgericht) has now substantiated such indications that speak for a malicious failure to accept other employment and, in the facts underlying the case, led to a reduction of the claim for default of acceptance wage to zero euros. The employee there had provided information both about placements proposed by the Federal Employment Agency and about applications sent as a result, as well as about all other applications he had made, in the proceedings for the default of acceptance wage. The Berlin-Brandenburg Labor Court considered the following indications to be sufficient to prove that there had been a malicious failure to obtain employment elsewhere in the specific case:
– In some cases, no applications were received in response to placement proposals from the Federal Employment Agency without any comprehensible justification.
– Companies to which the employee had applied could not reach him several times by telephone and the employee did not respond to an e-mail which referred to incomplete application documents and in which he was asked to send them again, without any comprehensible reason.
– There was no rejection for 29 applications and the employee did not ask about their status.
– According to the Berlin-Brandenburg Higher Labor Court, the number of the plaintiff’s own application efforts, specifically 103 applications over a period of 29 months, which does not even correspond to one application per week, was too low, since the plaintiff was without a job during these 29 months and would therefore have had to make application efforts to the extent of a full-time position.
– The quality of the application letters written had been insufficient (partly without job codes or any other subject; letters with identical content without individual adaptation to the vacant position and/or the potential employer; several spelling mistakes in the application letters).
According to all this, the employee has increased obligations in order to successfully defend himself against the accusation of malicious failure to obtain employment elsewhere. In summary, the employee must make full-time efforts to apply for a job if they do not work elsewhere and must, in particular, individualize the applications. Furthermore, if they do not receive any feedback/rejections, they must inquire about the state of affairs with the respective companies. The plaintiff in this case had not done any of this, at least in part, so that in the end he came away empty-handed in the legal dispute about the default of acceptance wage.
If wages for default of acceptance are demanded, it is first mandatory to assert a claim for information against the employee regarding the placement offers of the Federal Employment Agency as well as regarding the employee’s own job application efforts. The information provided by the employee must then be checked against the requirements set out by the Berlin-Brandenburg Higher Labor Court, and it must be objected in the proceedings for the default of acceptance wage that there has been a malicious failure to obtain employment elsewhere. In addition, the employer should also proactively send the employee (external) job offers with the request to apply for them; this increases the chance that the court that rules later will assume a malicious omission. If no claim for default of acceptance wages has yet been asserted in court, the above requirements would have to be taken into account as part of the settlement negotiations in order to achieve an appropriate financial settlement, even if the prospects of success with regard to the validity of the termination are not good.