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Labour law: Regular payment of a "voluntary" Christmas bonus can establish a claimable entitlement

Federal Labour Court, 21.04.2010, Ref: 10 AZR 163/09

If benefits to employees are not contractually regulated (e.g. in the employment contract or by company agreement), voluntary benefits from the employer may become enforceable claims under certain circumstances.

The lawyer then speaks of a company practice. A company practice is the regular repetition of certain behaviour on the part of the employer, from which employees can conclude that they are to be granted a benefit or advantage on a permanent basis.

The behaviour is then considered a contractual offer by the employer, which is generally accepted by the employee in accordance with Section 151 BGB (acceptance without declaration to the party making the offer). Accordingly, a contractual obligation arises with claims by the employee to the benefits that have become customary, which changes the content of the employment contract.

When it comes to Christmas bonuses in particular, it is often common for employers to initially make payments in good years without a contractually regulated legal basis and then stop these payments in bad years. This can easily lead to legal disputes about the non-payment.

Due to the current relevance, we would therefore like to draw your attention to the above-mentioned judgement of the Federal Labour Court of 21.04.2010, which dealt with this topic.

Facts of the Case:

Plaintiff had been dismissed as the wife of the managing director of his GmbH

The plaintiff (employee) was employed by the defendant (employer) for approximately ten years. The plaintiff was the wife of the managing director of the defendant. The plaintiff was the "boss" of the defendant's employees and performed other management tasks in addition to accounting work. The employment relationship was terminated by way of a court settlement following termination by the employer, which was based in particular on a loss of trust following the breakdown of the marriage.

In previous years, the plaintiff had received an annual bonus, but not in the last year

In 1998 and 1999, the plaintiff had received part of her husband's annual bonus. For the calendar years 2000 to 2006, the defendant paid an "annual bonus" to the plaintiff together with the December salary, as evidenced by the salary statements. The plaintiff did not receive an annual bonus for 2007.

Plaintiff invokes company practice

The plaintiff was therefore of the opinion that she was also entitled to an annual bonus for 2007. The entitlement to this had been implicitly agreed. A company practice had existed. In particular, it had to be taken into account that, unlike the other employees, she had not signed a reservation of voluntariness. The annual bonus was also not a benefit granted by the defendant "at its discretion" every year. Rather, it regularly corresponded to approx. 45 % of her annual salary and had remained the same most recently.

The labour court dismissed the claim and the regional labour court dismissed the appeal. The plaintiff pursued her claim on appeal.

Decision of the Federal Labor Court

Federal Labour Court confirms plaintiff's legal opinion

The Federal Labour Court followed the plaintiff's opinion. From the actual behaviour of the defendant in connection with the alleged statements of the shareholder, the submission of an offer had to be inferred, which the plaintiff had accepted by conclusive behaviour (§ 151 BGB). In this respect, the Regional Labour Court had ignored the possibility of interpreting a promise on the merits and thus violated §§ 133, 157 BGB. It erred in law by denying an individual claim simply because the payment had not been promised in a specific amount. However, it is typical of a bonus claim that it is dependent on various components, such as the operating result and/or personal performance, and therefore fluctuates. Therefore, it seems quite possible that, based on the annual payments in connection with the actual behaviour of the defendant, the plaintiff was justified in assuming that the defendant wanted to commit itself in some way to the bonus payments in the long term.

Source: Federal Labor Court

Important Note: The content of this article has been prepared to the best of our knowledge and belief. However, due to the complexity and constant evolution of the subject matter, we must exclude liability and warranty. Important Notice: The content of this article has been created to the best of our knowledge and understanding. However, due to the complexity and constant changes in the subject matter, we must exclude any liability and warranty.

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