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Serious changes for fixed-term employment in Germany announced

The formation of a new government in Germany has not yet been completed however since February 7, 2018, the coalition agreement has been signed. Such political guidelines were consistently implemented during the last legislative periods.

The changes affect fixed-term contracts which require no objective grounds for limitation. The maximum permissible duration of such fixed-term contracts will be reduced from 24 to 18 months. While previously a three-time extension of these contracts was allowed, this should now be possible only once within those 18 months.

The permitted number of such fixed-term employment contracts will also be limited. Employers with more than 75 employees should only be allowed a maximum of 2.5 percent of the workforce for non-material fixed-term contracts. Exceeding the quota leads to the ineffectiveness of any further fixed-term employment contract, and to permanent employment contracts.

Fixed-term contracts with objective grounds for limitation, in practice used if the employee has

Employee Representation in Germany – Part 1

November 7, 2017


Part I of III: The Works Council in Germany

“Works Councils – not again!” Every four years there will be new elections for the most important employee representative body in Germany. This coming March 2018 works council (re)elections will (again) take place in Germany. This blog series deals with the institute of the works council in Germany and will consist of three parts. Part I will provide you with an overview regarding its establishment, its structure, its rights and responsibilities, the election procedure and the costs related to it.


The works council is the main employee representative body at company level. In any operation (Betrieb) with more than five regular employees a works council (Betriebsrat) can be elected at the full discretion of the work force. In addition, a joint works council (Gesamtbetriebsrat) must be established if a company has more than one works council. For a corporate group,

Germany’s Major Reform on Company Pension – The Company Pension Strengthening Act

October 23, 2017


It was hard work and in the end a close call.  Up to the very end, it was unclear whether the “Company Pension Strengthening Act” (Betriebsrentenstärkungsgesetz) (“the Act”) would fail or succeed. On January 1 2018, most parts of the Act will come into force. The Act will bring the biggest reform of the company pension landscape in Germany since the enactment of the Company Pension Act (Betriebsrentengesetz) in the mid-70s and since the Pension Fund Law (“Altersvermögensgesetz”) of 2001. The objective of the reform is to strengthen company pensions and to promote further dissemination, especially within small and medium sized companies with respect to employees with low income. Below is a brief overview of the most important aspects of the reform.

Genuine Defined Contribution Plan

The key element of the reform is the recognition of a genuine defined contribution plan (reine Beitragszusage) as company pension promise under the Company

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