Termination Agreement in Germany – What Employees Need to Know
A termination agreement (Aufhebungsvertrag) ends the employment relationship by mutual consent – often faster than a dismissal, but with significant risks for employees. In most cases, signing leads to a 12-week unemployment benefit block. Always seek legal advice before signing!
Employment Law Specialist – Prenzlauer Berg / Pankow
Legal advice from a lawyer specialized in employment law is generally recommended before signing a termination agreement. Attorney Andreas Martin offers consultation and representation on all matters regarding the termination of employment relationships to clients from Berlin and Brandenburg. Advice is provided at his employment law office (branch) in Berlin Prenzlauer Berg.
Key points:
No notice period or dismissal protection applies
Unemployment benefit (ALG I) is usually blocked for 12 weeks
Signing a termination agreement usually leads to a 12-week block of unemployment benefits (§ 159 SGB III). Get legal advice first!
Comparison Table: Termination Agreement vs. Dismissal
Feature
Termination Agreement
Dismissal (Kündigung)
Initiation
By mutual consent
By employer or employee
Notice period
Not required (can be agreed freely)
Must follow statutory/contract
Severance pay
Negotiable, not guaranteed
Rare, only in special cases
Unemployment benefit (ALG I)
12-week block likely
No block if justified
Legal protection
No dismissal protection
Dismissal protection applies
Challenge possible?
Difficult, only in rare cases
Possible via labor court
Written form required
Yes (§ 623 BGB)
Yes (§ 623 BGB)
Process Flow: How a Termination Agreement Is Reached
flowchart TD
A[Employer offers termination agreement] --> B{Employee agrees?}
B -- Yes --> C[Negotiate terms: severance, end date, etc.]
C --> D[Agreement drafted in writing]
D --> E[Both parties sign]
E --> F[Employment ends on agreed date]
B -- No --> G[Employment continues or dismissal possible]
Podcast: 5 Common Mistakes with Termination Agreements
🔗 **[Listen on Spotify](https://open.spotify.com/episode/65sOHKFHNkUQFj2LdMM0IQ?si=NhSLwlW6R021fdku3BbuTg)**
What is a termination agreement (Aufhebungsvertrag) in Germany?
A termination agreement is a mutual contract between employer and employee to end the employment relationship. It is an alternative to dismissal and requires both parties' consent.
What are the risks of signing a termination agreement?
The main risk is a 12-week unemployment benefit block (Sperrzeit). Employees may also lose protection against dismissal and risk waiving further claims such as overtime or unused vacation.
Is severance pay guaranteed in a termination agreement?
No, severance pay is not mandatory. It must be negotiated individually and included in the agreement.
Does a termination agreement need to be in writing?
Yes, German law (§ 623 BGB) requires termination agreements to be in written form. Electronic or oral agreements are invalid.
Can I challenge a signed termination agreement?
Challenging a termination agreement is difficult. It is only possible in exceptional cases, such as fraud, threat, or lack of fair negotiation.
What should be included in a termination agreement?
Important points are: end date, severance pay (if any), release from work, settlement of vacation and overtime, return of company property, reference letter, and a final settlement clause.
Should I consult a lawyer before signing?
Yes, always seek legal advice before signing a termination agreement to avoid disadvantages and ensure your rights are protected.
