Termination according to list of names in insolvency

BAG from 17 August 2023 – 6 AZR 56/23

If a change of operation within the meaning of section 111 of the Works Council Constitution Act (BetrVG) is planned and the insolvency administrator and the works council conclude a reconciliation of interests with a list of names, it is presumed under section 125 (1) no. 1 of the Insolvency Statute (InsO) that the dismissal of the employee included in the list of names is due to urgent operational requirements.

At the time of the conclusion of the reconciliation of interests, the operational change must still be in the planning phase so that the works council is able to influence the entrepreneurial decision in accordance with the purpose of § 111 BetrVG.                

Facts

The parties dispute the validity of an ordinary notice of dismissal given for operational reasons. The plaintiff had been working for the insolvency debtor, a company from the steel industry with approx. 400 employees, since 2011. Against the background of a planned plant closure, the defendant insolvency administrator concluded a reconciliation of interests with a list of names with the works council formed at the insolvency debtor. After signing the reconciliation of interests, the insolvency administrator terminated the plaintiff's employment for operational reasons.

In its judgment of 13 January 2023 (Case No.: 16 Sa 485/21), the Regional Labour Court (Landesarbeitsgericht) Hamm had held the termination to be invalid, as the closure of the business at the time of the conclusion of the reconciliation of interests had not yet taken on a "tangible form" as a prerequisite for the presumption of effectiveness under section 125 (1) sentence 1 no. 1 InsO to kick in.

Decision   

The Federal Labour Court (Bundesarbeitsgericht – BAG) overturned the judgement on the defendant's appeal and found that the notice of termination had terminated the employment relationship. In any event, the termination was effective on the basis of the presumption under section 125 (1) no. 1 InsO that it was due to urgent operational requirements. The plaintiff had not been able to rebut the presumption.

The written reasons for the decision, for which only a press release has been issued so far, are eagerly awaited: The presumption of validity under section 125 (1) sentence 1 InsO only applies insofar as the change in operations on which the termination is based was already "planned" within the meaning of section 111 BetrVG when the reconciliation of interests was concluded. According to the (previous) case law of the Federal Labour Court, this presupposes a sufficiently definite measure, the details of which are already foreseeable, and the implementation of which is specifically sought by the employer (see Judgment of 20 November 2001 - 1 AZR 97/01, NZA 2002, 992).

The Higher Labour Court (Landesarbeitsgericht) Hamm, on the other hand, had explained in detail and with reference to the case-law of the Federal Labour Court that at the time of the conclusion of the reconciliation of interests only a "phase-out" had been initiated, but that a complete closure of the enterprise had not yet been seriously under discussion. In the end, the Federal Labour Court took the opposite view.       

Practical advice

In practice, however, it should not be relied upon that the courts now interpret the concept of "tangible form" in an extremely broad manner. If, at the time of the conclusion of the reconciliation of interests, the change of business is only in a preliminary planning stage, the presumption of conformity under section 125 InsO does not threaten to intervene: In a preliminary planning stage it will already hardly be possible to sufficiently inform the works council about the measures of the operational change. A concrete concept is (still) lacking. Notwithstanding this, the decision once again demonstrates how valuable the negotiation of a list of names in dismissal protection proceedings can be from the employer's point of view.