Germany: Federal Labor Court makes appeal to fixed-term contracts more flexible

Three-year waiting period.  In their coalition contract of October 2009, the conservatives and liberals announced their will to make fixed-term contract regulations more flexible (see our dispatch No.  091026), but nothing had followed since.  Without waiting for the announced bill, the judges in Erfurt made the first move by removing the ban on businesses to re-hire with a fixed-term contract, with no particular reason, people who already worked in the company in the past (Az: 7 AZR 716/09).  This ban was introduced in 2000 via the “Act on part-time and fixed-term contracts” (Teilzeit- und Befristungsgesetz – TzBfG) drawn up by the former red-green Gerhard Schröder administration.  Aiming to prevent businesses from collecting fixed-term contracts, the Act limits appeal to fixed-term contracts with no particular reason to new recruitments.  Thus, businesses are only allowed to hire someone with a fixed-term contract once and for up to two years.  Yet, employers say this slows recruitment down.  Indeed, it prevents businesses from offering a fixed-term contract to someone who already worked for the company within the framework, for instance, of their studies or apprenticeship.  Judging in turn that this law could stop recruitment, the judges decided to remove the ban.  Indeed, they think that abusive appeal to fixed-term contract is removed when businesses have to wait for at least three years before they can re-hire someone who already worked for them.  This way, the decree is indeed in line with the aim of the law, the judges added.