negotiate severance after termination is the central question after a dismissal. The case of a locksmith from the urban triangle shows: Even in blue‑collar jobs, with the right strategy you can get significantly more than the employer’s first offer. This guide explains how you can realistically assess your chances, avoid typical mistakes and ultimately achieve a better severance.
negotiate severance after termination: What Does a High Severance Mean – Realistic Benchmarks
The term “high severance” is not fixedly defined. What one person considers high may be a disappointment to another. What matters are the circumstances of the individual case: length of service, gross salary, company size and, last but not least, the negotiating skill of both sides.
As a rough rule of thumb, the formula of half a gross monthly salary per year of employment has become established in practice. For example, someone who worked ten years at a company and earned 3,000 euros gross could aim for 15,000 euros as a guideline. This rule of thumb is, however, no legal entitlement and also no guarantee. It merely serves as a starting point for negotiations. In reality, outcomes are often higher or lower – depending on how strong one’s position is.
A practical example: A 55‑year‑old machine operator with 20 years of service and a gross salary of 3,500 euros has, according to the rule of thumb, a guideline value of 35,000 euros. If the employer offers only 15,000 euros, that is a clear sign that negotiation room exists. Conversely, the amount may be lower if the dismissal is legally sound and the employer perceives little risk.
It is important to understand: A severance is always the result of an agreement between employee and employer. There is no automatic trigger that pays out with every dismissal. If you want a high severance, you usually need to do something – in most cases that means filing a dismissal protection lawsuit and negotiating.
Legal Foundations: When Do You Have Any Severance Entitlement at All?
Contrary to a widespread belief, there is no general statutory right to severance after a dismissal in Germany. The law provides only a few exceptions: for example, a social plan in case of operational changes or the severance under § 1a of the Dismissal Protection Act. This only applies if the employer expressly offers the severance in the dismissal letter and the dismissal is for operational reasons. It does not create a claim enforceable in court for a specific amount.
In most cases, a severance entitlement arises only through a settlement before the labor court or via an agreement in a termination contract. The employer pays not out of generosity but to avoid the risk of litigation. Exactly this risk must be built up by the employee – and this is done most effectively by filing a dismissal protection lawsuit. A good overview of the basics is provided by our overview of severance after dismissal.
The Dismissal Protection Lawsuit as a Lever for a Higher Severance
The dismissal protection lawsuit is the employee’s sharpest sword. It must be filed within three weeks of receiving the dismissal with the labor court. If this deadline is missed, the employee usually loses protection against dismissal – the dismissal then stands as valid, even if it could have been contested on substantive grounds. The lawsuit is therefore not an option but a necessary reaction if you do not want to accept the dismissal.
In court, it is examined whether the dismissal is socially justified. In the case of an operational dismissal, the employer must show that the job is permanently eliminated and that there is no alternative employment possibility. The social selection must also be correct. If it turns out that the dismissal is open to challenge, the pressure on the employer to offer a settlement with severance increases. This is where the strategy comes in: the better your chances of success, the higher the severance you can demand. A complete overview of the procedure, deadlines and costs can be found in our guide to the dismissal protection lawsuit.
Successfully Negotiating Severance: Strategies that Increase Your Offer
If you want to negotiate severance successfully, you should first realistically assess the chances of success of the dismissal protection lawsuit. The more likely it is that the dismissal will not stand up in court, the more you can demand. Another lever is back‑pay for delayed acceptance. If the dismissal is ineffective, the employer must continue to pay the salary until the proceedings are finally concluded. This can quickly amount to a five‑figure sum. In the negotiation you can bring this amount in as part of the severance.
Remember, to negotiate severance after termination you need a solid legal basis.
The length of service and the employee’s age also play a role – older workers with long tenure often have better prospects because they are harder to place on the labor market. Do not rush into a quick settlement if you are unsure. First obtain an assessment from an employment‑law specialist. Often it makes sense to reject the initial offer and make a counter‑offer. Even a court’s settlement proposal is only a starting point, not the final word.
The tax treatment is also relevant: A severance is subject to income tax, but can be tax‑advantaged thanks to the fifth‑rule. What will change in 2026 under the new BMF guideline is explained in our article “New Fifth‑Rule 2026”.
Typical Mistakes Employees Should Avoid in the Negotiation
A common mistake is to sign a termination contract too early. In doing so you often waive your protection against dismissal and receive only a small severance – sometimes none at all. Do not let yourself be pressured, even if the employer sets a deadline. A termination contract can, under certain circumstances, be contested, but this is complicated and not always successful. For more information see our article “Mistakes in Termination Contracts: The Most Common Pitfalls”.
Another mistake is to miss the lawsuit deadline. Anyone who does not file the dismissal protection lawsuit within three weeks loses protection against dismissal – and thus the most important lever for severance. Negotiating without a legal basis is also risky: if you do not know whether the dismissal is open to challenge, you are bargaining from a weak position. Therefore always have the chances of success assessed by an employment‑law specialist.
Successfully negotiating severance also means not relying on verbal promises. If you want to negotiate severance successfully, you should have the agreement recorded in writing, preferably in a settlement before the labor court. Only then are you legally protected and can enforce payment if necessary.
When It’s Worth Seeing an Employment‑Law Specialist – and How to Finance the Costs
In the event of a dismissal, consulting an employment‑law specialist is almost always worthwhile. They can assess the lawsuit’s chances of success, safeguard deadlines and conduct the negotiation. Fees are based on the amount in dispute, which usually amounts to three gross monthly salaries. This may seem high at first, but a specialist can often secure a substantially higher severance, so the costs usually pay off.
If you cannot or do not want to cover the costs yourself, there is the option of litigation funding. A litigation funder such as RechtStark examines whether it will finance the proceedings. If the lawsuit succeeds, it receives a share of the severance. The risk therefore lies not with you. It is important that the litigation funder works independently of the lawyer and is not a law firm of its own. You retain full control over your decisions.
Conclusion: Even as a Locksmith or Skilled Worker You Can Achieve a High Severance
The case of the locksmith from the urban triangle shows: Employees in blue‑collar jobs do not have to settle for the first offer. With a dismissal protection lawsuit and skillful negotiation they can obtain considerably more. What matters is to keep to the deadlines, to realistically assess the prospects of success and not to let yourself be pressured. With proper preparation and the support of an employment‑law specialist, the chances are good that you too can achieve a high severance.
Finally, to negotiate severance successfully, keep your documentation ready.
Note: This article is for general information purposes only and does not replace individual legal advice. For a free initial assessment of whether litigation funding may be an option for your case, you can contact RechtStark.