Special Protection Against Dismissal During Maternity Protection and Parental Leave: Why You Should Not Sign a Termination Agreement Too Quickly

Section 17 (1) MuSchG (Maternity Protection Act) prohibits dismissal during pregnancy and after childbirth. The duration is what matters: protection applies until the end of the protection period after childbirth, but in any event for at least four months after the birth.

This distinction is frequently confused in practice. The protection period under Section 3 (2) MuSchG – the prohibition on employment – is usually eight weeks after childbirth, or twelve weeks in the case of premature or multiple births or where the child has a disability. Protection against dismissal runs independently of this for at least four months and therefore typically ends considerably later than the prohibition on employment.

Anyone assessing their position on the basis of the eight weeks alone underestimates their own legal position by roughly two months.

The protection is also not tied to the Dismissal Protection Act (Kündigungsschutzgesetz). It applies in small businesses, during the probationary period, and even where the employment relationship has existed for less than six months. Employees in very small businesses, who would otherwise have no general protection against dismissal, suddenly find themselves in a very strong position.

Where parental leave (Elternzeit) follows, protection against dismissal applies under Section 18 (1) BEEG. This too applies regardless of the size of the business and length of service.

Two points are decisive here.

Protection begins when parental leave is requested – but not arbitrarily early. Under Section 18 (1) sentence 2 BEEG, it begins at the earliest eight weeks before the start of parental leave taken up to the child's third birthday, and at the earliest 14 weeks before the start of parental leave taken between the third and the eighth birthday. Requesting parental leave very early does not buy earlier protection against dismissal. The timing of the request should therefore be chosen deliberately.

Protection then applies for the entire duration of the parental leave. In practice this means: where maternity protection is combined with parental leave immediately afterwards, the employee can be dismissed only with prior official approval for many months – frequently well over a year.

The special protection is not an absolute prohibition. It operates as a reservation of approval. The supreme state authority responsible for occupational safety, or a body designated by it, may in exceptional cases declare a dismissal permissible in "special cases", Section 17 (2) MuSchG, Section 18 (1) sentence 4 BEEG.

What constitutes a special case is set out in the General Administrative Regulation on protection against dismissal during parental leave. Recognised cases include:

• complete closure of the business with no possibility of continued employment

• a threat to the employer's economic existence

• particularly serious breaches of duty or criminal offences by the employee

Honesty about one's own position matters here. Where a business is genuinely and permanently closing down, administrative case law holds that the authority is as a rule required to permit the dismissal; its discretion is largely reduced (Federal Administrative Court, judgment of 30 September 2009 – 5 C 32.08). Relying on the authority to refuse approval misreads the legal position.

The real leverage therefore does not lie in approval being refused, but in the point in time at which a dismissal can take effect at all.

The authority decides not only whether, but also when. The declaration of admissibility can be made subject to conditions – for instance that notice may only be given once the maternity protection period has expired, or only at the end of parental leave.

In addition, maternity protection and parental leave rest on two separate grounds for approval with different standards. Section 17 (2) MuSchG requires a special case that is unconnected with the woman's condition during pregnancy or after childbirth. The authority applies a particularly strict test here. In practice, dismissal during the protection period is permitted only exceptionally, and as a rule only with effect after that period has ended.

How long the procedure itself takes, by contrast, is frequently overestimated. The administrative regulation requires the authority to decide without undue delay once the employee and any works council have had the opportunity to comment. In Berlin, processing times are typically around two to six weeks. The procedure alone therefore does not buy a long postponement.

The time advantage comes instead from the combination: the application and the administrative procedure, the timing conditions attached to the approval, and the ordinary notice period under Section 622 BGB that follows. Ending the employment relationship by this route regularly takes considerably more months than the termination date first offered.

A widespread misunderstanding is that the employment relationship ends on the last day of parental leave. That is not the case.

Once the special protection expires, the general rules apply again. The employment relationship ends only once valid notice has been received and the applicable notice period under Section 622 BGB has expired. Where service exceeds five years, that is two months to the end of a calendar month; longer service means correspondingly longer periods.

The relevant remaining term is therefore longer than it first appears: special protection, plus the duration of the administrative procedure, plus the notice period.

This legal position reverses the usual balance of power. In a typical separation scenario, it is the employee who is pressing for a solution. Here it is the other way round.

An employer who wants to complete a restructuring, wind up a business or fill a position needs planning certainty for a specific date. The employer cannot create that certainty alone. It can only be obtained through a mutual termination – and that requires the employee's consent.

This is precisely where the economic value of the special protection lies. In economic terms, a severance payment here is not generosity on the employer's part but the outcome of a negotiation over a waiver that only one side can give. It does not, however, create a legal entitlement to severance.

There is no fixed formula. In practice, half a gross monthly salary per year of service is often used as a rule of thumb. That formula only partially reflects the situation described here, because it does not account for the special protection against dismissal at all.

What actually matters is:

• the remaining duration of the protection plus procedural time and notice period

• the effort and uncertainty of the approval procedure for the employer

• the specific time pressure on the employer's side

• the level of previous salary and prospects on the labour market

• the actual length of the working relationship

The first figure mentioned is practically never the last, and the termination date offered is rarely the earliest one possible.

Employees have often worked for the same employer before, with the employment relationship interrupted and then newly established.

In legal terms, length of service generally starts again after a longer legal interruption. Case law recognises the close factual and temporal connection needed to credit prior service only where the interruption was short – as a rule a few days to weeks. An interruption of several months is normally too long.

In negotiations, the actual overall duration of the working relationship remains a persuasive argument, particularly where the interruption occurred at the employer's request or where the employer actively wanted the employee to return. It does not, however, create a legal entitlement. Anyone who wants prior service credited should have it expressly recorded in the agreement.

An employee who terminates their own employment relationship generally engages in conduct contrary to insurance principles under Section 159 SGB III. The consequence is a blocking period (Sperrzeit) of up to twelve weeks, unless there is good cause.

Good cause may exist where the employee uses the termination agreement to pre-empt an otherwise unavoidable and lawful redundancy dismissal, and where the severance payment stays within the framework of Section 1a KSchG.

That presupposes that the agreement reflects this: the operational reasons must be named, it must be clear that the initiative came from the employer, and the ordinary notice period must be observed. A draft that neutrally describes the termination as "mutual" works against the employee at this point.

Read more: Settlement agreement and blocking period

A second mechanism is often overlooked. Where the employment relationship ends on shortened notice and a severance payment is made at the same time, entitlement to unemployment benefit is suspended under Section 158 SGB III until the period that would have applied to an ordinary employer dismissal has expired. That period is calculated from the date the termination agreement is concluded.

Blocking period and suspension are two different things and their effects can compound. The termination date is therefore not a formality but an arithmetic exercise.

Read more: Severance pay and unemployment benefits

Read more: Why severance pay is not the only issue

Where the employment relationship ends during the maternity protection period, this can affect the employer's supplement to maternity benefit under Section 20 MuSchG. The difference between the health insurance payment and previous net pay is substantial.

Whether and to what extent entitlements continue depends on the specific termination date and on the insurance position. This question should be resolved before signing, not afterwards.

There is a good deal of uncertainty here, although the distinction is clear.

Parental leave presupposes an existing employment relationship. It ends automatically when the employment relationship ends.

Parental allowance (Elterngeld), by contrast, is not tied to an employment relationship. What matters are the requirements of Section 1 BEEG: caring for and raising the child in one's own household, and not working full time. The entitlement continues even after the employment relationship has ended.

Losing parental leave therefore means primarily losing protection against dismissal and the prospect of returning to the job – not automatically losing the benefit. Conflating the two leads to negotiating on the wrong basis.

Almost every draft contains a clause at the end stating that, upon performance of the agreement, all mutual claims arising from the employment relationship are settled. Such clauses are regularly drafted too broadly and are the most common reason why claims are lost that nobody had in mind at the moment of signing.

The following should be expressly excluded from the clause:

• outstanding salary and variable pay components

• compensation for untaken holiday

• the severance payment itself

• the entitlement to a written job reference

• occupational pension entitlements

• capital-forming benefits

• release of employment documents

Read more: Settlement clause in German employment law

A draft prepared by the other side reliably covers what the other side needs. What the employee needs is usually missing:

• a clear provision on the amount and due date of the severance payment

• settlement of remaining holiday and accrued working time in the event of a release from duties

• a detailed job reference with an agreed grade, ideally with a draft attached

• the obligation to issue the employment certificate under Section 312 SGB III stating that the termination was for operational reasons

• a prohibition on set-off and exclusion of any right of retention regarding the financial obligations

• clarification that returning company property is not a precondition for payment

• a reference to the obligation to register with the employment agency under Section 38 SGB III

Read more: Settlement agreement before signing

A termination agreement is not a consumer contract. There is no statutory right of withdrawal.

Once signed, an employee can escape it only under very narrow conditions – for instance through rescission, or through a breach of the principle of fair negotiation developed by the Federal Labour Court, where a situation of psychological pressure was deliberately exploited. That is not something to rely on.

The rule therefore is: a draft that is supposed to be signed by tomorrow is a reason for caution, not for haste. In this constellation, the time pressure is almost always on the other side.

Where notice of dismissal is given, the works council must be consulted under Section 102 BetrVG; without proper consultation the dismissal is invalid. This does not apply to a termination agreement, which is concluded directly between employer and employee – no involvement of the works council is required.

The works council does, however, have a duty under Section 80 BetrVG to ensure that provisions benefiting employees are observed, and it can be approached for support. In the constellations described here – small businesses, companies being wound up – there is frequently no works council at all.

1. Is the special protection against dismissal still running, and for exactly how long?

2. How long would the employer realistically need for the approval procedure and the notice period?

3. Does the agreed termination date observe the ordinary notice period?

4. Is the termination expressly stated to be for operational reasons and initiated by the employer?

5. Are the amount and due date of the severance payment clearly defined?

6. What happens to maternity benefit, the employer's supplement and parental allowance on the chosen date?

7. Are remaining holiday, the job reference and employment documents dealt with?

8. Which claims does the settlement clause extinguish, and which are excluded from it?

9. Should earlier periods of service be credited, and is that recorded in the agreement?

10. Is there enough time left to have the draft reviewed?

Anyone offered a termination agreement during maternity protection or parental leave is negotiating from an unusually strong position – usually without knowing it. In this phase the employer cannot end the employment relationship unilaterally and depends on reaching an agreement.

The decisive mistakes are not made during negotiation, but when signing too quickly. The wrong termination date costs unemployment benefit, an overly broad settlement clause costs claims, and neither can be corrected afterwards.

Have a termination agreement reviewed before you agree to it – not afterwards.