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Collective redundancies: Failure to conduct a consultation procedure – sanction in the form of the exclusion of the set-off of claims for compensation for loss of earnings against those arising from the social plan?
In a judgement dated 12 February 2019 (1 AZR 279/17), the Federal Labour Court (BAG) ruled on the question of whether, if an employer fails to carry out the consultation procedure required in the event of a collective redundancy within the meaning of Section 17 of the German Redundancy Protection Act (KSchG) – or carries it out incorrectly – this is also sanctioned by the fact that claims for compensation for disadvantage are not set off against claims under a social plan.
Why is this relevant? The consultation procedure is a separate process distinct from the negotiations on the reconciliation of interests. Unfortunately, in practice it is often regarded merely as a tiresome formality, leading to potential – and possibly costly – sources of error on the part of the employer. For the employee, the claim for compensation for disadvantages may also be more attractive than the entitlement under the social plan, as the assessment criteria are not identical.
You can read the Federal Labour Court’s (BAG) view on this here:
https://www.deutscheranwaltspiegel.de/nachteilsausgleichsanspruch-kann-ein-scharfes-schwert-sein/
Note: This language version has been produced using AI-assisted translation. If you notice anything that could be improved, we would be pleased to receive your feedback.