Types of employment contracts

The employment contract can be concluded as a written and oral employment contract. Also, with regard to the timeframe of his graduation, he may be:

Permanent employment

An open-ended employment contract that can be terminated by:

  • Unilateral declaration (termination) by the employer or the employee.
  • Contractual agreement (termination agreement) between employer and employee.

Fixed-term employment contract

A fixed-term employment contract that ends without any relevant declarations or agreements, as it was concluded from the outset for a certain limited period of time that was agreed directly (e.g. December 31, 2023), was indirectly agreed (e.g. with the end of the project).

According to Section 14 of the Part-Time and Temporary Employment Act (TzBfG), a fixed-term employment contract may only be concluded if there is an objective reason for the limitation, e.g. if the operational need for work is only temporary or the limitation is for testing.
The calendar-based time limit of an employment contract without the existence of an objective reason is permissible according to § 14 TzBfG:

  • up to a duration of 2 years (whereby other regulations must be observed)
  • in the first 4 years after the establishment of a company up to a duration of 4 years

In addition, the fixed term of an employment contract does not require any objective reason if the employee has reached the age of 58 at the start of the fixed-term employment relationship. The time limit of an employment contract must be in writing to be effective.

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