If employers intend to make extensive staff cuts, they are legally obliged under the Labor Market Promotion Act (AMFG) to notify the AMS of the impending measures as part of the so-called early warning system.
This notification must always be made if the employment relationship of
– at least 5 employees in companies with generally more than 20 and less than 100 employees or
– at least 5 % of employees in companies with 100 to 600 employees or
– at least 30 employees in companies with generally more than 600 employees or
– at least 5 employees who have reached the age of 50 are to be terminated
within 30 days.
The wording of the law states that such notification must be made at least 30 days before the first declaration of termination of an employment relationship. The law does not explicitly define what exactly is to be considered a “first declaration” and which types of termination of an employment relationship are covered by it.
The Supreme Court recently dealt with this issue and interpreted the provision in its decision in a restrictive manner to the detriment of employers – the early warning system has therefore been tightened!
According to the purpose of the law, it should be possible to carry out consultations, make placement efforts or, if necessary, still secure the job before a number of employees relevant to labor market policy are made redundant. It is also in line with this purpose to assume the obligation to notify even if the employer only “intends” to restructure personnel. In any case, it would not be in line with the legal situation to link the obligation to a dismissal that has already taken place or the termination of an employment relationship by mutual agreement.
With reference to previous case law, the Supreme Court once again emphasized that the employer’s intention to terminate employment relationships can either lead to unilateral terminations or to offers of termination agreements that must be accepted, i.e. mutually agreed bilateral terminations. The different forms of declaration on the employer’s side do not change the core of the employer’s legal declaration, namely the intention to terminate the employment relationship.
The interest and intention to terminate the employment relationship with a number of employees is therefore already expressed if the employer makes offers for amicable termination to a number of employees exceeding the threshold value. Subsequent terminations as a result of non-acceptance of these offers are no longer relevant in this context, because the risk that Section 45a AMFG seeks to prevent, namely the risk that a relevant number of employees could lose their jobs within a short period of time and be made redundant on the labor market, already existed from the time of the employer’s declaration in the form of an offer and the notification obligation was already triggered at this point in time.
“If only the actual announcement of the termination or – in the case of termination by mutual agreement – the agreement on it were relevant, there would be no room for the notification of an intended termination within 30 days and for the waiting period of at least 30 days linked to the notification (Section 45a (2) AMFG)” – according to the Supreme Court.
As a result, terminations or amicable terminations that do not comply with this procedure must be regarded as legally invalid from the outset.
Systematic scattering of notices of termination over a period longer than 30 days can prevent the obligation to notify, but only if this was also the employer’s original intention. If the notices of termination are merely delayed in fact as a result of longer efforts to retain the job or due to further negotiations against the employer’s original intention, the obligation cannot be circumvented by such factual delays, as otherwise the aforementioned purpose of the early warning system would be defeated, i.e. the intention to lay off a relevant number of employees within a short period of time would be used as a reason to take precautions.
Supreme Court 9 ObA 119/17s