Employment contract: rules, regulations and contestation

Are there special formal requirements for employment contracts?

In principle, employment contracts are free of form, i.e. they can come about verbally, in writing or through so-called coherent behavior. Such "coherent behavior" could be assumed, for example, if the boss assigns you certain tasks at your appointment and asks you to do them immediately.
Exceptions to this freedom of form can be regulated in laws, collective agreements and company agreements. For example, employees of the health insurance companies and employers' liability insurance associations who are to be subject to the service regulations must be hired by means of a written contract. Your employment contract is otherwise null and void.

In your own interest, however, you should always insist that you receive a written employment contract. Otherwise, in the event of a dispute about contractual agreements with your employer, you would have real difficulties in providing evidence, unless you had at least one credible witness with you during the contract negotiations.

What should be regulated in the employment contract?

At least the following information should be included in the written employment contract:

• Name and address of the contracting parties

• Time of commencement of the employment relationship

• In the case of fixed-term employment relationships, the duration of the employment relationship

• Workplace

• The name or description of the work to be performed by the employee

• Composition and amount of the remuneration including supplements, allowances, bonuses and special payments as well as other components of the remuneration and their due dates

• Any special services provided by the employer (e.g. the use of a company car)

• The agreed working hours and their location

• The length of the annual vacation leave

• Deadlines for terminating the employment relationship

• Possibly a general reference to the collective agreements, works or service agreements that apply to the employment relationship.

Subsequent changes to the contractual conditions should also always be recorded in writing for reasons of evidence. If you are to work in different locations, this must be specified in the employment contract. Otherwise, your employer could assign you to different places of work at will due to his right of direction. In contrast, a general description of your area of responsibility is sufficient for the job description.

When can an employment contract be contested?

Like other contracts, employment contracts can also be contested due to error, threat or fraudulent misrepresentation in accordance with the provisions of the German Civil Code. For example, when an employee was hired, there may have been an error about their expertise. If it later emerges that the employee does not have the expertise required for the position and is therefore not suitable for the assigned tasks, the employer can contest the employment contract on the grounds of error.

If an employee has deliberately concealed important facts for the employment relationship when he is hired (such as a previous conviction for embezzlement when applying as a cashier) and this comes out later, then the employment contract can even be challenged for fraudulent misrepresentation.

Conversely, an employee can of course also challenge the employment contract if the employer has deceived him, for example about the working conditions (e.g. pure writing instead of the promised organizational tasks).

Eine berechtigte Dispute kann zu einer vollständigen Aufhebung des Arbeitsverhältnisses führen. Unter Umständen können sich darüber hinaus Schadensersatzansprüche gegen den Vertragspartner ergeben, der den Anfechtungsgrund zu verantworten hat. Haben Sie beispielsweise eine andere sichere Stellenzusage abgesagt und können Sie die Anforderungen Ihrer jetzigen Arbeitsstelle deshalb nicht erfüllen, weil Ihr Arbeitgeber Sie nicht umfassend über die Ausbildungsvoraussetzungen für diesen Arbeitsplatz aufgeklärt hat, können Sie den Arbeitsvertrag anfechten und Ersatz des Schadens verlangen, der Ihnen durch die Absage der anderen, sicheren Stelle entstanden ist (z. B. das Gehalt, das Sie dort bekommen hätten).

Employment contract - important judgments

Surprising clauses
A contractual preclusive period for the assertion of claims from the employment relationship in the event of termination of the employment relationship does not become part of the contract if the author of the contract does this without special notice and without typographical emphasis under a wrong or ambiguous heading (e.g. not in the employment contract, but in of the company regulations under the heading Miscellaneous).
BAG, November 29, 1995 - AZ: 5 AZR 447/94

Incorrect answer to attitude questions
The incorrect answer to the question about the severely disabled status can justify the contestation of the employment contract due to fraudulent misrepresentation according to § 123 BGB. A severely disabled employee is then not entitled to continued payment of wages in the event of incapacity for work.
BAG, December 3, 1998 - AZ: 2 AZR 754/97

Employer's duty to provide information
If an employer does not fully inform a job applicant about his future work in the company, he can make himself liable to pay compensation to the employee if he is terminated again during the probationary period because he cannot meet the requirements of the job.
LAG Frankfurt / Main, in: »Handelsblatt« of 29 p. 2000

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