German Employment Law—Top 9 Developments in 2025

The Federal Labor Court (decision dated June 26, 2025 – Ref. No. 8 AZR 276/24) held that a mere failure to appoint an inclusion officer does not, by itself, constitute discrimination based on disability. However, it may serve as an indication of discrimination. Employers that have not yet made the appointment required by Section 181 of the Social Security Code IX (SGB IX), may want to ensure that they do so.

Warnings issued to employees with severe disabilities can constitute discrimination. If the representative body for employees with severe disabilities is not informed and heard before a warning is issued, this may indicate causation where the specific concerns of the employee with a severe disability are affected. This can be the case, for example, with warnings for refusing to perform work that is not appropriate in light of the disability.

In a decision dated April 3, 2025 (Ref. No. 2 AZR 178/24), the Federal Labor Court clarified that an employer does not need to conduct a prevention procedure under Section 167(1) SGB IX before giving notice of ordinary termination during the statutory waiting period under Section 1(1) of the Protection Against Dismissal Act (KSchG). The prevention procedure is not a condition for valid termination. Its omission does not, by itself, create a presumption of discrimination based on disability under the General Act on Equal Treatment (AGG).

This contradicts the decision of the Regional Labor Court of Cologne dated September 12, 2024 (Ref. No. 6 SLa 76/24), which treated the absence of a prevention procedure as an indicator of discrimination. The Federal Labor Court clarified that the prevention procedure applies only if the Protection Against Dismissal Act is applicable. It does not apply during the waiting period or in small businesses.

On October 23, 2025 (Ref. No. 8 AZR 300/24), the Federal Labor Court held that employees do not have to rely on the median. A disadvantage is presumed if an employee earns less than a single comparable colleague, even if that colleague is a top earner. If the employer cannot rebut this, the higher pay must be granted. The size of the comparator group and median pay for men and women do not matter for this purpose. It is enough to assert and, if needed, prove that a colleague performing the same or equivalent work is paid more. This ruling is also a wake-up call in view of the European Union’s Pay Transparency Directive (Directive (EU) 2023/970) that must be implemented by June 7, 2026.

In a decision dated June 3, 2025 (Ref. No. 9 AZR 104/24), the Federal Labor Court held that statutory minimum vacation cannot be waived during an ongoing employment relationship through a court settlement. A clause stating “vacation claims are granted in kind” is invalid under Section 13(1) sentence 3 of the Federal Leave Act (BUrlG). This is especially true where it is already clear that, due to illness, the employee cannot take any vacation before the employment ends. A claim for vacation pay arises only upon termination and cannot be effectively waived beforehand. A facts-based settlement was out of the question here, because continuous incapacity for work removed any uncertainty about the actual requirements.

On January 30, 2025, the Federal Labor Court (Ref. No. 2 AZR 68/24) ruled that there is no prima facie evidence of receipt of a termination letter if the employer presents only a mailing receipt and a printout of the tracking status. Prima facie evidence may exist only if the reproduction of the delivery record is also provided and the delivery process was carried out properly. Employers may therefore want to always request and keep the delivery record from Deutsche Post.

The court explicitly left open whether it follows the newer case law of the Federal Court of Justice (decision dated May 11, 2023 – Ref. No. V ZR 203/22), which recognizes prima facie evidence of delivery when both the mailing and delivery records are available.

Any relief from the Federal Court of Justice’s approach may be short-lived. Deutsche Post has adjusted the delivery process, and the Regional Labor Court of Hamburg reacted in a decision dated July 14, 2025 (Ref. No. 4 SLa 26/24). Registered mail remains an uncertain delivery method.

Since the introduction of Section 15(3) Part-Time and Fixed-Term Work Act (TzBfG), which requires the length of a probationary period in fixed-term contracts to be proportionate to the term of the contract and the nature of the work, the lower courts have passed several judgements on the issue at hand. The Federal Labor Court has now addressed the subject and concluded that there are no rigid limits regarding the waiting period. It depends on the circumstances of the individual case (decision dated October 30, 2025 – Ref. No. 2 AZR 160/24).

The line between a work accident and a private accident depends on the factual link between the specific activity and the insured employment. If the activity during which the injury occurred primarily served private purposes (here: jumping outside to escape a flash fire caused by an exploding electric scooter battery), there is no work accident. The Regional Social Court of Berlin and Brandenburg decided this on October 9, 2025 (Ref. No. L 21 U 47/23).

In two decisions dated October 30, 2025 (Ref. No. C‑134/24 (Tomann); Ref. No. C‑402/24 (Sewel)), the CJEU held that in cases of mass dismissals, the absence of a notification renders the terminations invalid. There is no possibility of subsequent validation, if the notification is posted after the dismissals have taken place. A defective or incomplete notification does not meet the objectives of the Collective Redundancies Directive (Directive 98/59/EC), even if the employment agency has issued a confirmation.

Matrix structures are common in many companies. Managers often direct team members across divisions and locations. How does this affect participation rights? A recent decision of the Federal Labor Court dated May 22, 2025 (Ref. No. 7 ABR 28/24) clarifies voting rights in works council elections under Section 7 of the Works Constitution Act. Managers in matrix structures can be eligible to vote in more than one establishment.