Business transfer dismissal protection is a key safeguard for employees when their employer is sold. With the potential sale of ContiTech, many are asking whether their jobs are secure – business transfer dismissal protection provides a clear answer.
A business transfer occurs when a business or part of a business passes to a new owner by legal transaction. That is exactly what happens in a sale like ContiTech’s. In employment law terms, this means the employment relationships of affected employees transfer automatically to the buyer. That sounds unsettling, but it is actually a protective mechanism – your job remains intact at first; only the employer changes.
What the ContiTech Sale Means for Employees
When a corporation like ContiTech divests business units, the jobs are fundamentally preserved. The new owner steps into all rights and obligations under your existing employment contract. That covers salary, working hours, vacation, and all agreed conditions. Your previous length of service also continues to count with the new owner – important for future notice periods or potential severance payments.
However, a sale is not automatically linked to dismissals. A dismissal issued solely because of the business transfer is prohibited by law. The new owner may later reduce headcount for operational reasons – but then the general dismissal protection rules apply. That is why it is critical to know your rights before making any decisions.
Understanding Business Transfer Dismissal Protection Under Section 613a BGB
The central provision for business transfers is Section 613a of the German Civil Code (BGB). It secures three key points: first, the acquirer automatically takes over your employment relationship. Second, a dismissal because of the transfer is invalid. Third, you have a right to object if you do not wish to work for the new employer.
Your current employer must also inform you in writing about the transfer – at least one month before the planned date. The notification must state the timing, reasons, and legal consequences for you. If this information is missing or defective, a later dismissal may be invalid – a frequent point of attack in dismissal protection proceedings.
It is worth examining this information carefully. If the buyer does not want to take over your employment relationship or the seller leaves your future unclear, you have options. The basic steps of a lawsuit are outlined in our guide to unfair dismissal claims – including deadlines and requirements explained clearly.
What Happens to Your Employment Contract and Dismissal Protection?
Many worry that the new boss could unilaterally change the terms. Section 613a BGB expressly forbids that: the acquirer steps into the existing contract. They can neither cut pay nor change working hours without your consent. Changes are only possible through a change notice, which must meet strict social justification requirements – otherwise you can challenge it.
Collective bargaining agreements and works agreements also continue to apply initially. The new employer may replace them after a transition period if they are themselves bound by a collective agreement or conclude a different works agreement. In practice, this often leads to negotiations over social plans – frequently aimed at mitigating disadvantages for employees.
Your protection during the business transfer is particularly strong: the previous employer may not dismiss you because of the transfer, and neither may the new owner. If a dismissal is issued anyway, you can challenge it at the labor court within three weeks of receipt. Missing this forfeits your statutory protection – swift action is essential.
The Role of the Works Council and Social Plan in a Sale
During a business transfer, the works council has extensive co-determination rights. The employer must inform it in good time and comprehensively – about timing, reasons, economic consequences, and impacts on the workforce. The works council can also demand a social plan to compensate financial disadvantages, for example through severance payments, retraining measures, or hardship compensation.
For you personally, this means: contact the works council early if you have questions. They know the negotiations and can represent your interests. If there is no works council, you are more reliant on your own initiative – but the statutory protective provisions still apply.
A social plan is not automatic – it is negotiated between employer and works council. The amount of severance payments depends on factors such as length of service, age, and the company’s economic situation. That is why it is important to inform yourself about your individual rights and, if necessary, seek expert advice.
What You Can Do Now: Advice and First Steps
If a sale like ContiTech’s is pending, you should not simply wait. Check whether you have received written notification. If not, request it – your rights depend on it. Contact the works council or a legal advisor to have your individual situation assessed. An employment law specialist can tell you whether the planned transfer is valid and what risks exist.
Even if the business transfer is not yet complete: the earlier you inform yourself, the better you can react. The severance guide after dismissal gives you an overview of what is possible in settlement negotiations – from the rule of thumb to tax questions.
Also note the possibility of objecting to the transfer. The objection must be declared within one month of proper notification. But caution: an objection means your employment relationship stays with the previous employer – who may no longer have any employment opportunity. It should therefore be well considered and only used in exceptional cases, such as impending insolvency of the acquirer. Your business transfer dismissal protection only works if you meet the deadlines – miss the three-week deadline for an unfair dismissal claim, and you lose that protection.
Negotiating Severance: What Is Realistic and What Matters
In many cases, a business transfer ends with a termination agreement or a court settlement – often involving a severance payment. There is no statutory entitlement to severance; it arises only through individual negotiation or a social plan. As a reference point, the rule of thumb of 0.5 gross monthly salaries per year of service is often used – a benchmark, not a legal guarantee.
Your negotiating position depends heavily on whether a dismissal would be invalid. If the employer knows you have good prospects at the labor court, they are often more willing to compromise. Conversely, you should not let yourself be pressured into accepting an offer before you have realistically assessed your chances. An employment law specialist can be decisive here.
Even if you are financially uncertain: a litigation funder like RechtStark can cover the cost risk of an unfair dismissal claim. You then do not have to worry about legal and court fees – the litigation funder receives a share of the secured severance only in case of success. More insights into similar situations can be found in our article on severance in plant closures and on unfair dismissal claims in mass layoffs.
Conclusion: Your Options as an Affected Employee
The potential sale of ContiTech is a burden for the workforce – but not a hopeless situation. The statutory protection during a business transfer gives you a strong legal foundation. Two things matter most: meet the deadlines and get advice early.
You have the right to stay, to object, or to negotiate severance. Use the support of the works council, an employment law specialist, and, where appropriate, a litigation funder. The better you know your rights, the more confidently you can shape the business transfer.
To sum up: statutory protection during a business transfer applies from the moment the ownership changes – but only if you act. Inform yourself, review your documents, and seek an expert opinion if in doubt. That way you make the right decision for your professional future.
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.