Under German law, an employer can only suspend an employee in certain cases. One of the core obligations of the employment relationship is an obligation on the employer to provide the employee with relevant work to be performed. If it fails to do so without justification, it must nevertheless continue to pay the employee. Notwithstanding this, a mutual agreement to suspend the employee, whether paid or unpaid, is of course always possible.

Suspension without continued payment of remuneration

An employer may not suspend an employee without payment of salary unless it is explicitly provided for by law or in collective rules (in some cases these impose an obligation on the employer to suspend). As an employer fully bears the operational risk of its business, it is in particular not possible for it to suspend the employee for merely financial reasons. Examples of the right to suspend an employee provided for by law include: the suspension of a pregnant employee during the statutory maternity protection periods (set periods before and after childbirth); during parental leave (a voluntary leave intended for childcare); in certain cases during the illness of a child; and during part-time retirement. Further, in labour disputes, German courts have – within strict boundaries – recognised an employer’s right to unilaterally suspend an employee without continued payment of salary in order to achieve parity in the dispute.

Suspension with continued payment of remuneration

An employer is also limited in its ability to unilaterally suspend an employee with continued payment of remuneration. The employer may be required to suspend the employee in order to enforce holiday, for example, if the employee refuses to take outstanding holiday and the employer would need to compensate the employee for outstanding holiday (e.g. where the employment is coming to an end). Otherwise, German courts allow for suspension only where there is a material reason to do so and where the interests of the employer outweigh those of the employee. Although this always requires a case-by-case assessment, the employer may be entitled to suspend the employee for the duration of the notice period, e.g. in cases of an ordinary dismissal by reason of misconduct. Where dismissal is based on operational reasons (i.e. redundancy), a suspension will be permitted only in (rare) cases where the employee’s redundancy occurs with immediate and definitive effect. In cases of a dismissal for cause and during the consultation phase with the works council or pending the approval of the necessary authorities (e.g. in cases of a pregnant or disabled employee), the “compelling reason” required by German law for the justification of a such dismissal will almost in all cases also justify the immediate suspension of the employee.

Where the suspension is irrevocable, the employer can cause any outstanding holiday as well as any overtime hours of the employee to be “used up” during the suspension and notice period (therefore avoiding any otherwise necessary compensation to be paid at the end of the employment). As a result a mutual and, where justified, unilateral suspension of an employee after the termination of the employment is common in practice. Such crediting of holiday and overtime hours, however, is not possible where the suspension can be revoked, i.e. if the employer can require the employee to come back to work.

In case of a suspension, there is generally no obligation on the employer to involve the works council.

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