Are layoffs for operational reasons permitted during short-time work (Kurzarbeit, Germany's state-subsidized reduced-hours scheme)? It is generally assumed that an operational dismissal during short-time work is possible.

Under German law, an operational dismissal during short-time work cannot be justified by the same reasons that led to the short-time work in the first place. A dismissal because of a sharp drop in orders that led to short-time work is therefore not permitted.
If the situation in the company has worsened after short-time work began, it may be that an "improvement of the situation" for the employer does not apply. This is where the distinction between a "temporary lack of work" and a "permanently reduced need for staff" matters.
If the employer can only prove the former, that is a valid reason for introducing short-time work, but not yet a justification for an operational dismissal.
For the Federal Labor Court, it is understandable that an operational dismissal despite short-time work can only be justified if the possibility of employing the workers affected by short-time work permanently ceases to exist due to circumstances that arose later.

Dismissal during short-time work

Dismissal during short-time work, only with special justification?

There is no special protection against dismissal during short-time work either. The employer only has to observe general dismissal protection. Dismissal protection applies if you have been employed by the employer without interruption for at least 6 months and the company regularly has more than 10 employees.
Existing dismissal protection only permits dismissal for operational, personal or conduct-related reasons.

Dismissal during short-time work because of a lack of orders?

The employer can only apply for short-time work allowance if there is merely a temporary lack of orders. The short-time work allowance is only meant to bridge a short-term loss of work.
• With an operational dismissal, however, it must be concluded that the position will cease to exist permanently.
• If short-time work allowance is applied for first and an operational dismissal follows later, the employer is acting inconsistently. Unless the situation has changed.

What could be reasons for a change?

• Since the short-time work allowance was applied for, orders have collapsed massively and the company's financial and economic situation has deteriorated dramatically.
• After short-time work began, tasks were consolidated or outsourced to other companies.
• After short-time work was registered, individual areas of production were restructured and closed.
For conduct-related dismissals, for example for theft, there are no new rules during short-time work either. If you have worked at the same company for more than six months, dismissal protection also applies during short-time work. The statutory notice periods continue to apply without restriction.

Dismissal during short-time work

Dismissal during short-time work - Conclusion

Dismissal during short-time work and an operational dismissal don't have to be mutually exclusive. When applying for short-time work, the employer may have assumed a temporary lack of work.
However, if further circumstances arise that give reason to fear a longer, possibly permanent lack of work, the employer can certainly dismiss employees. The employer must be able to prove the changed circumstances, though, which is sometimes not easy.
Employees should not accept a dismissal during short-time work without a fight. In the case of a dismissal, a lawsuit for unfair dismissal is usually worthwhile. You must file this lawsuit with the labor court within three weeks of receiving the written notice of dismissal.