According to the Federal Labor Court, an activity as a manager does not constitute grounds for a fixed-term contract

In a ruling dated June 1, 2022(Case No.7 AZR 151/21), the Federal Labor Court decided that the activity as a manager or in a managerial function does not constitute a reason for a fixed term based on the specific nature of the work performance (Section 14 (1) No. 4 TzBfG). In particular, the employee's prominent position or the resulting powers do not give rise to a justified interest of the employer in a fixed term. This applies even if extensive freedom to issue instructions was lived in the relevant employment relationship.


1. facts

In the proceedings, the parties disputed the validity of a fixed-term contract. The plaintiff worked for the defendant (a hospital organized under public law) as director of a cross-campus center for radiology and diagnostics on the basis of a fixed-term employment contract. He worked largely without instructions and in a prominent position. He brought an action for a limited term against an expiring limited term pursuant to § 17 TzBfG. The labor court had dismissed the action. The plaintiff employee's appeal against this was successful.


Decision 2

The defendant's appeal was unsuccessful. In the view of the Federal Labor Court, the fixed term was invalid. In particular, a fixed term was not justifiedby the factual reason of the specific nature of the work performance pursuant to Sec. 14 (1) No. 4 TzBfG. It is true that the law does not specify what is to be understood by the specific nature of the work performance. However, not every such peculiarity is suitable to justify a fixed term. A fixed term is only possible if the work performance has special features which give rise to a justified interest of the parties, in particular of the employer, to conclude only a fixed-term contract instead of an open-ended contract. These special circumstances must outweigh the employee's interest in establishing a continuing obligation. In the view of the Federal Labor Court, neither freedom to issue instructions nor a particularly prominent position of an employee is sufficient for this. In particular, the mere fact that a person is a senior employee within the meaning of Section 14 (2) of the German Unfair Dismissals Act (KSchG ) is not sufficient to justify such a legitimate interest.


3. conclusion 

This decision is no surprise and fits in with the previous case law of the Federal Labor Court. For employers who want to install a certain dynamic through competition in top management positions by means of fixed-term contracts, the familiar guidelines therefore remain in place. It continues to be a tight corset within which employers are allowed to operate within the framework of fixed-term employment contracts with a material reason pursuant to Section 14 (1) TzBfG.

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