goetz labor law phone icon

+49 0 6221 392906 0

goetz labor law mail icon

Employment contracts possible digitally in the future?

The federal government recently agreed to replace the written form in the Evidence Act with the text form in accordance with. § 126b Civil Code to replace. The change is to be subsequently integrated into the government draft for the Fourth Law to relieve the burden on citizens, the economy and the administration of bureaucracy (Bureaucracy Relief Act or BEG IV), which was passed on March 13, 2024.

The government draft for the amended BEG IV will now be sent to the Bundesrat for comment and, following a counter statement from the Federal Government, it will be forwarded to the German Bundestag and discussed there.

1. Present Situation

In order to assess the impact of this change, it would be advisable to take a look at the points of employment law it affects.

Even under the current legal situation, employment contracts are in themselves basically formless. A distinction must be made between this and the written form requirement resulting from the Evidence Act for proof of the essential contractual conditions of the employment relationship.

The electronic form of proof is in accordance with. Section 2 Paragraph 1 Sentence 3 NachwG so far expressly excluded. The employment contract can be concluded effectively without any form. The proof according to Section 2 Paragraph 1 Sentence 3 NachwG However, it must then be handed over to the employee separately from the employment contract and signed in writing by the employer. Both are independent of each other. The employment contract itself is not invalid even if written evidence is not provided. In current practice, employers often provide their employees with written employment contracts, so that according to Section 2 Paragraph 5 NachwG There is no need to provide separate written evidence of the essential contractual conditions of the employment relationship. 

However, if employers want to effectively limit an employment contract, the situation is different. The effective limitation of an employment contract requires that the agreement on the fixed term is concluded in writing (Section 14 Paragraph 4 TzBfG; This refers to the exchange of handwritten signatures of both contracting parties on a document). The written form requirement extends to both the conclusion and any extension of a fixed-term employment contract. This also includes so-called pension exit clauses). Different than after Civil Code § 623 The electrical form is not excluded, but it follows § 126a Civil Code in conjunction with Art. 26 eIDAS Regulation requires the use of the qualified electronic signature of both contracting parties.

Even when agreeing on a post-contractual non-competition clause, it is required in accordance with § 74 Para. 1 HGB the written form. Whether this can be replaced by electronic form is controversial. If the replacement option is accepted, a qualified electronic signature from both contracting parties would also be necessary here.

2. Change through the Bureaucracy Relief Act

In the future, employers will no longer have to hand out the terms of their employment contracts to new employees in paper form with a signature. A corresponding passage should be inserted into the draft law to reduce bureaucracy. Originally it was intended that the written form would be signed using electronically qualified signatures (QES). § 126a Civil Code can be replaced. This draft should now be adapted. The agreement now made stipulates that instead of the written form (Civil Code § 126) the contractual conditions will in future be in text form (§ 126b Civil Code) is sufficient. While in the written form the corresponding document must be signed by the issuer himself with a name signature or with a notarized hand sign, a readable, unsigned declaration on a durable medium is sufficient to maintain the text form. This means that an employment contract can be concluded entirely via email.

In a letter to the associations affected by the new regulations, Federal Justice Minister Marco Buschmann (FDP) wrote: “Specifically, the Evidence Act will in future make it possible to provide proof of the essential contractual conditions in text form, provided that the document is accessible to employees, can be saved and printed out and the employer receives proof of transmission and receipt.“Only if employees request this does the employer have to provide them with written proof. 

However, these changes should be those in the Anti-Clandestine Workers Act (§ 2a SchwarzArbG) mentioned economic sectors or branches such as the construction industry, building cleaning and the meat industry are excluded.

According to Buschmann, employee transfer agreements should also be made (in contrast to the previously required written form in accordance with. Section 12 Paragraph 1 Sentence 1 AÜG) can be closed by email in the future.

Changes to the strict written form requirements for fixed-term contracts (Section 14 Paragraph 4 TzBfG) or post-contractual non-competition clauses (§ 74 Para. 1 HGB) do not result from the federal government's agreement, so these must still be agreed in writing.

3. CONCLUSION 

The formal simplifications for employment contracts resulting from the passed Bureaucracy Relief Act IV go in the right direction. However, in their current form they fall short. This does lead to some relief for employers. However, due to the differences between “normal” employment contracts and those with fixed-term contracts or post-contractual non-competition clauses, there are also sources of error.