Regulated working life

Munich (May 25, 2018). Foreign real estate investors continue to push on to the German market – and with this comes lots of work for lawyers. Even experts like the hospitality specialist Dr Anton Ostler, Partner at the law firm Arnecke Sibeth in Munich and hospitalityInside’s editorial expert for legal must repeatedly explain the ins and out of German law to investors and hotel owners. For this reason, he has put together a summary of German labour law for this target group – a guide which is also intended to protect them from disappointment and all too great an expectation.

How do local employment laws and regulations in Germany affect the activities of foreign investors? Are there any specific laws which make it particularly difficult to handle employees?
German labour law applies to all employment relationships in Germany, even if the employer is a foreign national or company. Although EU law allows the parties to an employment contract to choose the applicable member state law, German national law supersedes other chosen law where German law is mandatory law (ordre public), enacted to protect employees’ interests.

To avoid legal challenge or other uncertainty it is advisable to assume German labour law will apply and that it be stipulated as the basis for the employment contract. German labour law is not codified in a single consolidated labour code but derived from various sources (in particular several codified laws, case law of the Federal Labour Court, collective bargaining agreements (Tarifverträge) and, where these exist, works council agreements (Betriebsvereinbarungen).