News & Analysis as of

Employee Benefits Germany

Latham & Watkins LLP

German Federal Labour Court Rules on Virtual Share Options and Exit Bonuses

Latham & Watkins LLP on

The German Federal Labour Court has tightened its case law. According to a decision from 19 March 2025 (10 AZR 67/24), the reasons for which were only recently published, employees may be entitled to an exit bonus even if the...more

Orrick, Herrington & Sutcliffe LLP

No Waiver of Statutory Minimum Leave Through Court Settlement

On June 3, 2025, the Federal Labor Court (Bundesarbeitsgericht) ("BAG") ruled that employees are entitled to financial compensation for outstanding statutory minimum vacation days. Even if a court settlement includes an...more

Morgan Lewis

German Federal Labor Court Strengthens Employee Rights for Virtual Stock Options upon Employment Termination - Legal Insights...

Morgan Lewis on

In its ruling dated March 19, 2025, the German Federal Labor Court (BAG)—in contrast to the two previous instances and contrary to its previous case law—deemed an expiry clause in general terms and conditions to be...more

Fisher Phillips

Germany’s New Coalition Agreement Impacts Labor Law and Social Policy: 10 Key Takeaways for Employers

Fisher Phillips on

Germany’s recent federal election signaled a shift in the country’s politics – and employers will surely feel the impact. The center-right Christian Democratic Union and its sister party, the Christian Social Union, won the...more

Orrick, Herrington & Sutcliffe LLP

#ESOP: How to Deal with the New Case Law on the Forfeiture of Vested Virtual Shares – A Practical Update for Employers and...

Incentive programs like an employee stock option plan or a virtual stock option plan ("VSOP") are widely used by young technology companies ("Company") to reward and retain talent ("Beneficiaries"). A key feature in these...more

A&O Shearman

Germany: employment law aspects of the coalition agreement at a glance

A&O Shearman on

The coalition agreement between the CDU/CSU and the SPD, titled “Responsibility for Germany,” was announced on April 9, 2025. It outlines the future political strategy for Germany, addressing several aspects of employment...more

Ogletree, Deakins, Nash, Smoak & Stewart,...

German Federal Labor Court Finds Certain Virtual Stock Option Forfeiture Clauses May Unreasonably Disadvantage Employees

On March 19, 2025, the German Federal Labor Court (Bundesarbeitsgericht or BAG) held in Case No.: 10 AZR 67/24 that certain forfeiture clauses in General Terms and Conditions of Business (Allgemeine Geschäftsbedingungen or...more

Morrison & Foerster LLP

Koalitionsvertrag 2025 aus steuerrechtlicher Sicht

Die Koalitionsgespräche sind abgeschlossen. Wir geben einen ersten Überblick über die gemeinsamen steuerrechtlichen Ziele, die sich CDU/CSU und SPD als Koalitionspartner gesetzt haben. Die Koalitionspartner planen Änderungen...more

King & Spalding

VSOPs – the End of Bad Leaver Clauses in Germany?

King & Spalding on

Virtual Stock Option Plans (VSOPs) are a common tool used by companies to incentivize employees by linking part of their compensation to the company’s long-term success. Unlike traditional stock options, VSOPs do not grant...more

Orrick, Herrington & Sutcliffe LLP

Lapse of Virtual Stock Options in the Event of Voluntary Resignation – Good Leaver or Bad Leaver?

On March 19, 2025, the German Federal Labor Court (Bundesarbeitsgericht) ("FLC") ruled that a provision in an employee stock option plan providing for the immediate forfeiture of vested virtual stock options in the event of...more

Paul Hastings LLP

Ruling of the German Federal Labor Court on the Invalidity of Expiry Clauses in ESOP/VSOP - Applicability of the Ruling to MEPs

Paul Hastings LLP on

On March 19, 2025, the German Federal Labor Court ("BAG") ruled that clauses that qualify as general terms and conditions and stipulate that virtual option rights that are already vested at the time of termination of an...more

Fisher Phillips

Germany’s Political Shift Could Bring Changes to Labor Law and Social Policy: Key Points for Employers

Fisher Phillips on

Germany’s federal election last month signaled a shift in the country’s politics – and employers need to understand how this might soon impact them. The center-right Christian Democratic Union and Christian Social Union won...more

Littler

Layoffs in Germany & Poland: Differences & Similarities

Littler on

As layoff procedures in Poland and Germany are anchored in the same EU Directive, their national regulations are similar in direction, but they still have their own flavor and local specificity. Germany and Poland share...more

Littler

Gender Discrimination in Company Pension Schemes in Germany: Need for Action and Cost Risks

Littler on

The EU Pay Transparency Directive imposes a need for companies in the European Union to take action. Employee comparison groups must be established to identify potential gender pay gaps. Employees are granted extensive and...more

Hogan Lovells

Works Constitution in Germany – An Overview 2025

Hogan Lovells on

The concept of works council participation has a long tradition in Germany, dating back to the Weimar Republic following World War I. Information and consultation rights for employee representatives were introduced by the...more

Ius Laboris

Re-skilling and Up-skilling: How to Win the ‘War for Talent’

Ius Laboris on

The digitalisation of work is having a profound impact on the skills that employers need from their workforce, resulting in the competing challenges of skilled worker shortages and widespread redundancies. The solution to...more

DLA Piper

What's New in 2025 for Global Equity Plans

DLA Piper on

As we settle into 2025, companies granting equity compensation awards to their employees around the world are encouraged to monitor developments that affect compliance and administration across different jurisdictions. ...more

Orrick, Herrington & Sutcliffe LLP

Legal Ninja Snapshot: #ESOP & Flips - U.S. ESOPs for Employees of the German Subsidiary Now Available

Good news! The second chamber (Bundesrat) has now paved the way for the eagerly awaited and much-debated inclusion of a group privilege in sec. 19a of the German Income Tax Act (“EStG”). German start-ups that have done the...more

Hogan Lovells

Ab 2025 einheitliche Beitragsbemessungsgrenzen in der Sozialversicherung in Ost und West

Hogan Lovells on

Kurz vor dem Bruch der Ampel-Koalition hat das Bundeskabinett am 6. November 2024 die Sozialversicherungsrechengrößen-Verordnung für das Jahr 2025 beschlossen. Die zugrunde gelegte Lohnentwicklung im Jahr 2023 betrug im...more

Orrick, Herrington & Sutcliffe LLP

Legal Ninja Snapshot: #ESOP & Flips — U.S. ESOPs May Become Available for the Employees of the German Subsidiary

Much has been written about the unsatisfactory tax situation of German employees when it comes to equity-based employee stock (option) programs ("ESOP"). Historically, employees were taxed at the time of issuance of shares...more

Hogan Lovells

Stärkung des Betriebsrentenstärkungsgesetzes

Hogan Lovells on

Die Neuerungen in der betrieblichen Altersversorgung (bAV) durch das Betriebsrentenstärkungsgesetz, die in weiten Teilen zum 1. Januar 2018 in Kraft getreten sind, haben die hohen Erwartungen nicht vollständig erfüllt....more

Ius Laboris

Fit for 2024: Important legal changes for employers

Ius Laboris on

A number of important changes for employers in Germany took effect at the beginning of 2024. We provide an overview of the changes that have already come into force and also give an outlook on upcoming and planned legislative...more

Skadden, Arps, Slate, Meagher & Flom LLP

Proposals To Reform Germany’s Pension System Could Open Market, Benefitting Retirees and — Potentially — Insurers

If Germany’s coalition government follows through on recommendations from a focus group convened by the Federal Finance Ministry for reforms to the country’s pension system, it could open the way for insurers and other...more

Hogan Lovells

Konzernzusagen zur betrieblichen Altersversorgung

Hogan Lovells on

Leistungen der betrieblichen Altersversorgung gewährt der Arbeitgeber als Versorgungsschuldner. Wenn aber die betriebliche Altersversorgung durch Konzernbetriebsvereinbarung geregelt ist, sollen nach Ansicht das...more

Hogan Lovells

Anpassung der Beitragsbemessungsgrenzen in der Sozialversicherung in 2024

Hogan Lovells on

Das Bundeskabinett hat am 11. Oktober 2023 eine deutliche Erhöhung der Grenzwerte für die Sozialversicherung beschlossen. Die zugrunde gelegte Lohnentwicklung im Jahr 2022 betrug im Bundesgebiet 4,13 Prozent....more

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