The German Federal Labour Court (BAG) has decided that employees retain their rights to all options already exercised after resigning, in a ruling handed down on 19 March. Applicable retroactively to employment contracts that have already expired, the ruling represents a clear reversal of case law, with significant consequences for companies.
In a ruling dated 19 March 2025, Germany’s Federal Labour Court (BAG) ruled that clauses in employee participation programmes stipulating that virtual stock options that have become exercisable are immediately cancelled in the event of the employee’s resignation are invalid. The invalidity also applies to clauses stipulating that options expire more quickly after the end of the employment relationship due to resignation. According to the federal judges, such clauses disadvantage employees...
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Article authors
Thomas Schnee
Freelance