Termination for urgent cause: the key requirements at a glance

What constitutes an urgent cause?

A summary dismissal is only possible if there is an urgent cause (dringende reden). This is conduct or a characteristic of the employee that is so serious that the employer cannot reasonably be expected to continue the employment relationship.

The law provides several examples of urgent causes, including theft, fraud, assault, serious threats, gross insults, and persistent refusal to perform work. This list is not exhaustive. Other forms of conduct may also constitute an urgent cause. Case law provides numerous examples, such as falsifying timesheets or expense claims, inappropriate or aggressive behaviour in the workplace, and leaking or transferring confidential business information.

In addition, it is not uncommon for a summary dismissal to be based not on a single incident, but on a series of events that ultimately culminate in an urgent cause for dismissal. Examples include repeatedly arriving late for work or regularly failing to attend work without justification. Previous warnings and a carefully documented personnel file often play an important role in these cases.

Weighing all circumstances

Whether an urgent cause exists depends heavily on the specific circumstances of the case. Relevant factors include the employer's policies and the extent to which those policies are consistently enforced. Courts also consider the employee's position, length of service, past performance, any previous warnings, the employee's age, and the personal consequences of dismissal.

As a result, the same conduct may justify a valid summary dismissal in one situation but not in another.

Formal requirements

In addition to the existence of an urgent cause, a summary dismissal must satisfy two formal requirements: the employer must dismiss the employee without delay and must communicate the urgent cause without delay.

The employee must immediately understand that the employment contract has been terminated, why it has been terminated, and which facts form the basis for the dismissal. Courts assess these requirements strictly.

Immediate dismissal

The employer must dismiss the employee as soon as it becomes clear that an urgent cause exists. This does not mean that immediate action is always required. Once there is a suspicion of an urgent cause, the employer may take time to investigate the facts, obtain legal advice, conduct internal consultations, and apply the principles of hearing both sides.

However, the time available for these steps is limited. The employer must act diligently and without unnecessary delay. If an employer waits too long, this may create the impression that the situation was apparently not sufficiently urgent to justify immediate dismissal.

Immediate communication of the urgent cause

Just as the dismissal itself must be given without delay, the reason for the dismissal must also be communicated without delay. The employee must understand why they have been summarily dismissed.

General allegations, such as "a lack of trust", are insufficient. The employer must describe the relevant facts as specifically as possible. The reason communicated to the employee largely defines the scope of any subsequent legal proceedings. An employer cannot later supplement or alter the grounds for dismissal. The wording of the dismissal letter therefore requires particular attention.

It is advisable to explain the dismissal verbally during a dismissal meeting and subsequently confirm it in writing in the dismissal letter.

Consequences for the employee

The consequences of a summary dismissal are severe. The employment contract terminates immediately. The employee loses their income with immediate effect, is generally not entitled to unemployment benefits, and, where the conduct qualifies as seriously culpable, is not entitled to a statutory transition payment.

In addition, the employer may claim the statutory fixed damages compensation (equal to the salary that would have been earned during the employee's notice period) or set off that amount against sums still payable to the employee, including the final salary payment, accrued but unused vacation days, and holiday allowance. Depending on the circumstances, the employee may also be liable for additional damages.

What if the employee challenges the dismissal?

An employee who disagrees with the dismissal may petition the court to annul the dismissal. Such a request must be filed within two months of the summary dismissal. The employee may argue, for example, that no urgent cause existed or that the formal requirements were not complied with.

If the court annuls the dismissal, the employment contract is deemed never to have ended. The employer must allow the employee to return to work and must pay the salary that accrued during the intervening period, together with statutory interest and the statutory increase for late payment of wages.

Alternatively, the employee may choose to accept the termination and instead claim compensation, including a transition payment, statutory fixed damages compensation, and/or an equitable compensation.

Conclusion

A valid summary dismissal requires more than merely seriously culpable conduct by an employee. The employer must be able to demonstrate that an urgent cause exists, must dismiss the employee without delay, and must communicate the reasons for the dismissal clearly and without delay.

This does not necessarily have to happen immediately. Case law provides employers with a reasonable period to conduct a careful investigation, provided they act diligently and expeditiously. Interested in learning more about conducting investigations into potential urgent causes? We will soon publish a separate article on this topic.

Because a summary dismissal can have major consequences for both employee and employer, careful preparation is essential. If you are uncertain whether the circumstances justify a summary dismissal, it is advisable to seek legal advice in advance. The specialists of Ploum's Employment Law Team are happy to assist.

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