Termination without notice in Germany: Requirements and consequences

A termination without notice (fristlose Kündigung) ends employment immediately with no notice period. This brings serious consequences: sudden income loss and unemployment benefit suspension. For immediate dismissal to be valid, strict requirements must be met – especially “just cause” making it unreasonable to continue employment until the regular notice period ends. Labor courts set high standards, so many immediate dismissals fail legal scrutiny. Additionally, employers can only issue termination without notice within two weeks of learning the relevant facts.

Key takeaways:

• Termination without notice ends employment immediately without observing the regular notice period.
• There is a high bar. German law requires just cause and balancing of interests between both parties, presupposing serious misconduct.
• There is a  two-week deadline for the employer: employers must act within 14 days of learning the facts, or dismissal becomes invalid.
• The consequences are harsh: A valid immediate dismissal means instant wage loss and often a three-month unemployment benefit suspension.
• To challenge termination without notice, file a dismissal protection lawsuit within three weeks.

What is termination without notice?

A termination without notice (also called extraordinary termination) is a dismissal that ends employment immediately without observing the notice period. Unlike regular dismissal, no notice period applies. From the day of dismissal, wages stop completely. As an employee, you don’t have to work after receiving the termination, but you also have no chance to prepare for job change and unemployment. Usually, termination without notice also triggers an unemployment benefit suspension.

Either employer or employee can issue termination without notice, though it’s typically the employer. However, immediate dismissal is only legally valid when just cause exists that makes continuing employment “even one more day” unreasonable. Labor court requirements are extremely strict here, as German employment law tends to favor employees. This applies to immediate terminations as well.

The requirements for termination without notice are regulated in the German Civil Code (BGB), not the Dismissal Protection Act. Whether you call it termination without notice or extraordinary termination doesn’t matter – both terms mean the same thing.

Requirements for termination without notice

Immediate dismissal is regulated in Section 626 BGB. Employers or employees can terminate employment for just cause without observing a notice period only when facts exist that, considering all circumstances of the individual case and weighing both parties’ interests, make continuing employment until the end of the notice period unreasonable.

Courts interpret these requirements in an employee-friendly manner due to the serious consequences for workers when employers dismiss them. Specifically, valid termination without notice has these requirements:

• Just cause must exist: There must be such serious misconduct or breach of duty that continuing employment until the end of the notice period is unreasonable.
• Balancing of employee and employer interests: A careful examination occurs whether immediate termination is justified considering all circumstances and both sides.
• Two-week deadline: Dismissal must be issued within two weeks after learning of the termination grounds.¹

Just cause requirement

The law doesn’t precisely define “just cause”. However, the courts have interpreted and specified this term in case law. Because of discretion in individual cases, different case categories exist. In any case, there must be serious misconduct suitable for making continuation of employment until the end of the regular notice period “unreasonable”. According to the case law, examples include:

• Fraud against the employer, such as faking illness
• Other crimes harming the employer, like theft, embezzlement, or extortion
• Other workplace crimes, including time theft, assault and coercion against colleagues, customers, or business partners – under certain conditions also crimes occurring outside work
• Serious violations of employment contract duties, like betraying trade secrets or unauthorized self-granted leave
• Unauthorized competitive activity with direct competitors during ongoing employment despite non-compete clauses
• Other conduct, such as mobbing, sexual harassment at work, Nazi slogans, or Hitler salutes at the workplace

Balancing employee and employer interests

When objective facts are suitable for issuing termination without notice, the next step requires balancing interests. This means:

• All circumstances of the individual case must be considered. The balancing criteria are: What misconduct occurred (type, severity, frequency of violations)? How badly was trust damaged? How severe were the violations? What operational disruptions resulted? What financial damage did the misconduct cause? Business harm? Is the misconduct attributable to the employee? How long was their tenure? Are there dependents?
• There must be no milder alternatives to immediate dismissal (proportionality principle).
• This principle includes whether prior warnings are required. Generally:
  • Existing warnings regarding the same misconduct can support dismissal validity.
  • No warning is required for particularly serious violations the employer obviously doesn’t have to tolerate (example: serious fraud against the employer).
• Interest balancing must always consider whether continuing employment until the end of the regular notice period is unreasonable.
• Hearing the employee before issuing dismissal is not required.
• Ultimately, the dismissing party’s interests (usually the employer) must clearly outweigh the dismissed party’s interests (usually the employee).
• The judicial balancing of employer and employee interests is often decisive for a conduct-based dismissal’s validity. Even with serious duty violations, dismissal can be disproportionate and thus invalid. Labor courts carefully examine whether dismissal was truly the last resort or whether milder measures would have sufficed.

Observing the two-week deadline

Termination without notice can only occur within two weeks, per Section 626(2) BGB. The deadline begins when the dismissing party learns of the relevant facts. The dismissal must also reach the employee within this period.

Additional general dismissal requirements

As mentioned earlier, termination without notice must meet strict legal requirements to be valid. This section covers additional general requirements, including written form and representation rules, works council consultation, and whether immediate dismissal without prior warning is legally possible.

Written form and representation rules

Termination without notice must be in writing, per Section 623 BGB. The dismissal letter must be personally signed by the employer or an authorized representative. Verbal dismissal or dismissal via email, WhatsApp, or fax is always invalid. The dismissal doesn’t necessarily need to state reasons. However, the dismissing party – usually the employer – must immediately provide written reasons upon request for immediate dismissal.

When dismissal comes not from the employer but from an authorized representative, employees should always check whether a power of attorney accompanies the dismissal letter. Without one, the employee can reject the dismissal on these grounds. If rejection happens immediately (usually within one week), this leads to dismissal invalidity.² However, rejection rights don’t exist when dismissal comes from someone the employee knows has authority, such as an HR director. Also, if the employer previously informed the employee of the authorization, rejection isn’t possible. In such cases, rejection doesn’t lead to invalidity.

Works council consultation

Even for termination without notice, the works council must be consulted in advance if one exists. The employer must inform the works council of the reasons for immediate dismissal. Without this consultation, dismissal is invalid even if the reason itself were justified.

Termination without notice and without prior warning

Immediate dismissal without prior warning is permissible – but only in exceptional cases. Typically, termination without notice also requires that the employee previously received one or more warnings. These inform the employee that their behavior or work performance is criticized and make clear that dismissal may follow repeated violations. Only when continuing employment is absolutely unreasonable for the employer is immediate dismissal without warning possible. However, behavior already addressed in a warning cannot be used again as dismissal grounds. A warning’s purpose is to give employees the chance to correct their behavior.

Other general requirements

Besides the works council, other bodies may need involvement for termination without notice when special protections apply. For dismissing severely disabled persons, prior approval from the integration office is required. Dismissal of pregnant employees or mothers under maternity protection is generally inadmissible – here, prior approval from the competent supervisory authority must be obtained. Without this approval, dismissal is invalid.

Legal consequences of termination without notice

Assuming the immediate dismissal is actually valid, employees face these consequences:

• Employment ends with immediate effect, without observing a notice period.
• All compensation claims cease from the dismissal date.
• In many cases, the employment agency imposes an unemployment benefit suspension of up to twelve weeks, especially when contract-violating behavior is alleged.
• Additionally, immediate dismissal can negatively affect the employment reference and complicate job searches.

If termination without notice is invalid:

• Employment continues with all rights and duties.
• The employer must pay back wages for the period since dismissal due to default of acceptance.

Courts or the contracting parties can reinterpret termination without notice as regular dismissal. This requires assuming the dismissing party would have at least issued regular dismissal if immediate dismissal were invalid.

In many cases, employers therefore explicitly state in the dismissal that they want to issue at least regular (with notice period) dismissal if immediate dismissal is invalid (“subsidiary” regular dismissal).

What to do if you receive termination without notice

If you receive immediate dismissal as an employee, act immediately – the consequences are severe. This applies regardless of validity if you don’t fight back and let the lawsuit deadline pass. Take these steps:

• Carefully review the dismissal letter, note the lawsuit deadline (three weeks from receipt), and immediately seek legal advice. Ideally, discuss the dismissal immediately with an attorney specialized in employment law to evaluate your options.
• Within three weeks of receiving dismissal, you must file a dismissal protection lawsuit with the labor court, or the dismissal is deemed valid. Most dismissal protection lawsuits are resolved quickly (within one to three months), and success rates for employees are typically good. More details in our article on dismissal protection lawsuits.
• Additionally, secure all relevant documents and evidence, such as warnings, emails, or witness statements. This strengthens your position and increases chances for a substantial severance payment. If you file your lawsuit on time, the employer has the burden of proof for the immediate dismissal’s validity in dismissal protection proceedings.

Frequently asked questions (FAQ)

1. Section 626(2) BGB ↩︎
2. Section 174 BGB ↩︎