In Germany, employees may not be treated adversely on the grounds of race, ethnic origin, gender, religion, secular belief, disability, sexual identity or age. Any provisions in agreements which violate the prohibition of adverse treatment are invalid.

Where there has been adverse treatment, the employer is obliged to pay the affected employee compensation unless the employer can prove that he is not responsible for the violation. For example, if a job applicant is not hired on grounds of age despite being the best qualified among the candidates, the job applicant can claim compensation for the loss he would have suffered up until the first possible termination date.

Where the damage resulting from the adverse treatment does not involve a financial loss, the employee or employees can demand an appropriate monetary compensation, irrespective of the employer´s culpability. Nevertheless, in the event of a failure to hire a person, the compensation may not exceed three months´ salary if the employee would not have been hired had the selection been free of adverse treatment.

An employee has to assert any such claim in writing within a period of two months after the employee obtains knowledge of the adverse treatment. In addition, a lawsuit must be filed within three months after the claim has been asserted in writing.

The protection against discrimination on grounds of age in favour of the employees is ensured by the allocation of the burden of proof in case of a legal dispute: If the employee proves the existence of indications that would give rise to an assumption of adverse treatment based on the grounds of age, the employer has to prove that no violation of the provisions for the protection against adverse treatment occurred. Therefore, if for example, an employer advertises for a “young” applicant, the German Federal Labor Court will make an assumption that a rejected applicant is discriminated on the basis of his age, when a younger applicant is hired. In this case the employer has the burden of proof that the applicant´s age did not play a role for the older applicant´s rejection.

Nevertheless, it should be noted that differences in treatment on grounds of age are permissible if they are objectively and reasonably justified by a legitimate aim. The means of achieving that aim must be proportionate and necessary. Such differences in treatment may specifically include, for example, fixing age limits in the company social security systems, including a retirement age in an employment contract at the time at which the employee may apply for a statutory pension or differentiations in the benefits provided under social plans. Against this background the German Federal Labor Court has for example ruled in a recent decision that a social plan can validly stipulate that dismissed employees are not entitled to compensation where they are eligible for a pension after the receipt of unemployment benefits and have rejected an offer of employment at another site of the company.

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