An example of an employment contract with the founder
Employment law for startups - 10 facts you should know about employees
The subject of labor law is quite complex. As a result, some startups in all industries tend to neglect it, especially in the start-up phase. But sooner or later it can hardly be avoided to be confronted with a labor law problem. But what should founders pay attention to when hiring employees? What are the important facts and what are wild myths? How do you best work with students and what are temporary jobs? This specialist text provides answers to the ten most important questions.
Fact 1: The specialist lawyer is essential
It is not uncommon for the transition from the classic salaried job to starting a company to be fluid. What begins with many night shifts in self-employment soon requires a few extra hands. As soon as the support turns from friendly help into paid work, it is time to deal with the issue of labor law. Businesses of all sizes should work with a specialist lawyer who has extensive experience in labor law. Anyone who thinks with foresight chooses a renowned partner who has mastered national and international labor law right from the start.
Fact 2: Fixed-term contracts not the best option for startups
What sounds quite logical at first glance is a cardinal error at second glance, which gives many startups a bad reputation. In a start-up, even full-time employees are not always tied to the company in the long term with full protection against dismissal. Due to the often small size of the company or the short duration of employment, it is usually possible to terminate the contract promptly if this should prove necessary. Fixed-term employment contracts unnecessarily deter potential employees with good qualifications.
Fact 3: Working student better than students with mini-jobs
Students are a welcome way to secure good workforce at a fair price. Students should best be hired through a student labor contract. This exempts companies from paying fees for long-term care, health and unemployment insurance. This exemption does not apply to a mini-job employment contract.
Fact 4: No termination without notice during the trial period
It is not uncommon for the unsuspecting to think that a probationary period means an easy game of dismissals. But be careful: Unless otherwise contractually agreed, startups must also give two weeks' notice - even during the trial period.
Fact 5: Not every employment contract can be terminated in two weeks
Once an employment contract is signed, it is legally valid. From this moment on, the employee is legally equated with an employee who has been with the company for a longer period of time. This also means that the employee cannot simply withdraw from the contract. So look exactly how terminations and contract dissolutions are formulated, which rules may result from collective agreements, etc. In other words: ask a specialist lawyer at least once.
Fact 6: The protection against dismissal takes effect from the 10th employee
The following applies to new companies: From the tenth permanent employee, the Dismissal Protection Act applies to the full extent. Accordingly, from the tenth permanent employee onwards, you can no longer dismiss someone because “it just didn't work out that well, for example”. Be prepared for the fact that a dismissal in an emergency must be justified in court by relevant factors.
Possible reasons for termination are (and they are precisely defined in terms of content and form):
- Termination for operational reasons
- Behavioral termination
- Termination for personal reasons
Founder's Council: Use the probationary period
Founders should generally use the probationary period to closely examine and observe the employee. If there is any doubt about a long-term cooperation, it is not advisable to simply take the risk and see if the situation might improve.
Fact 7: There are rules for posting jobs
How a successful job advertisement should look is a completely different topic. But when it comes to job postings, it is imperative for companies to be aware of the anti-discrimination law, which has been in force since 2006. If, for example, an advertisement reads that an older accountant with experience is being sought, in theory young men have the legal backing to initiate a lawsuit for discrimination. Even if this very delicate problem is not the order of the day, it is better to be on the safe side and to know the basics of protection against discrimination.
Fact 8: Arrange overtime correctly right away
Too much work and too few resources - a well-known problem with startups. The solution can often be found in the fact that employees work a lot of overtime. The handling of this overtime must be contractually regulated in advance. A lack of compensation can lead to costly claims for additional payments in the event of a separation from the employee. In addition, if the statutory limit for overtime is exceeded, there is even a risk of a fine.
Founding Council: You have to be able to prove verbal agreements
Oral agreements are binding under certain circumstances, but they must be clearly demonstrable. This is not the case without a witness. It is essential to bear this in mind during employee appraisals.
Fact 9: workplace design is not a bonus program
The number of employees is growing, but the small office is still stuck in the old lease for a few months? One or the other employee ends up with his desk in the hallway. In the event of an unexpected visit by the authorities, a fine can hardly be avoided. In the area of workplace design, there are a number of points to consider, such as:
- Sufficient air space
- Adequate movement area
- Compliance with non-smoker protection
Gründerrat: These are the rules for workplace design
To what extent are the boss or the company actually obliged to offer employees good conditions in the workplace? And what exactly is part of an ergonomic workplace? The most important rights and obligations that employers have are presented to you in this specialist article: How ergonomic does the workplace have to be? - the employer's obligations
Fact 10: This is how you protect yourself from being poached by your top employees
If the startup can be found in a competitive niche, good employees are in great demand. It is not uncommon for immoral offers from competing companies to poach a top employee and his know-how. In principle, this procedure cannot be prevented. However, if the contract contains an appropriate period of notice, a confidentiality clause or even possible penalties for non-contractual termination, risks in this area can be minimized.
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