Category Archives: Politics Law Society

Politics Law Society

Employer“s right to give instructions regarding business trips abroad

Employer“s right to give instructions regarding business trips abroad

Employer"s right to give instructions regarding business trips abroad

An employer“s executive prerogative entails being able to order business trips abroad if the employee commits himself to undertake this kind of service in his or her employment contract. That was the verdict of the Landesarbeitsgericht (LAG) Baden-Württemberg [Regional Labour Court of Baden-Württemberg].

In many industries, business trips come with the territory for a lot of employees. In the wake of globalization, business trips no longer mean simply travelling within Germany or to neighbouring countries but also further afield to countries such as China. We at the law firm GRP Rainer Rechtsanwälte note that according to a ruling of the LAG Baden-Württemberg from September 6, 2017 (Az.: 4 Sa 3/17)), an employer is able to order these kinds of business trips by virtue of its executive prerogative if the „versprochene Dienste“, i.e. the promised services, set out in the employment contract pursuant to sec. 611 para. 1 of the Bürgerliches Gesetzbuch (BGB) [Germany“s Civil Code] can naturally be associated with occasional foreign assignments.

The case before the LAG concerned an engineer who had been employed for about 30 years at a machine manufacturer and was rarely sent on business trips, and on those rare occasions only to countries nearby. However, he was then made to travel to China. From the employee“s point of view, the hotel, service and location of the accommodation left much to be desired. He viewed the trip as a form of victimization by his employer and brought a legal action to prevent his employer from being allowed to send him on business trips abroad, at least not to distant countries.

The LAG dismissed the claim, stating that although an employee need not accept intolerable accommodation while abroad, he can be sent on business trips. Moreover, the employer can set out in more detail the working hours, places of work and what the work entails as it reasonably sees fit as long as no contractual or collectively agreed provisions preclude this. The Court held that in this case the employer“s right to issue instructions in relation to the place of work was not limited by the employment contract due to the lack of a clear provision on this issue. The fact that the work owed by the engineer was not limited to a single location was said to be evident from a provision in the employment contract concerning compensation for travel expenses. The LAG went on to say that this kind of arrangement made no sense in the absence of an obligation to go on business trips, and gave leave to appeal.

When it comes to matters pertaining to the workplace or drafting employment contracts, lawyers who are experienced in the field of employment law can offer advice.

https://www.grprainer.com/en/legal-advice/employment-law.html

GRP Rainer LLP www.grprainer.com/en/ is an international firm of lawyers and tax advisors who are specialists in commercial law. The firm counsels commercial and industrial companies and corporations, as well as associations, small- and mid-sized businesses, self-employed freelancers and private individuals worldwide from offices Cologne, Berlin, Bonn, Dusseldorf, Frankfurt, Hamburg, Munich, Stuttgart and London UK.

Contact
GRP Rainer LLP
Michael Rainer
Augustinerstraße 10
50667 Cologne
Phone: +49 221-27 22 75-0
Fax: +49 221-27 22 75-24
E-Mail: info@grprainer.com
Url: http://www.grprainer.com/en

Politics Law Society

Managers“ risk of liability and D&O insurance

Managers“ risk of liability and D&O insurance

Managers" risk of liability and D&O insurance

Mistakes made by managers can prove costly both for the company as well as the managers themselves. For this reason, many companies take out D&O insurance policies for their executive personnel.

The executives in a company not only bear considerable responsibility, they can also be held accountable for the mistakes they make and held liable with their private assets. An increasing number of businesses have therefore begun taking out D&O insurance or management liability insurance for their governing entities. The business can benefit from this as well if it personally asserts claims against its executive personnel and the D&O insurance needs to kick in.

The Volkswagen emissions scandal made and still continues to make headlines. Yet matters pertaining to managerial liability are not always sensational cases plastered across all of the media. In insolvency cases, for instance, the company in question or its governing entities may be faced with claims brought by the insolvency administrator. Here, it normally pays off to have concluded a D&O insurance policy, which is why liability insurance for managers has long since ceased to be an issue that only concerns large corporations and is now of interest to a lot medium-sized companies.

There are, of course, also instances where a claim arises but the insurer does not wish to step in. We at the commercial law firm GRP Rainer Rechtsanwälte note, therefore, that one needs to closely examine which circumstances are covered by the insurance when taking out the policy. That is why the individual risk potential ought to be analysed carefully and the policy tailored to specific needs.

Obviously, it is absolutely crucial to consider the insured sum under the policy. It is equally important that claims arising both from internal liability, i.e. claims brought by the company against its executive personnel, and external liability in cases involving claims brought by third parties be covered.

Other essential aspects include retroactive coverage as well as coverage for follow-up liability. In the case of retroactive coverage, the insurer also commits to stand good for circumstances that took place prior to the conclusion of the policy but that were not discovered until later on. With respect to follow-up liability, insurance coverage will also be provided in the event that a claim arises during the term of the policy that is not discovered until afterwards.

All in all, there are a lot of details that one needs to be mindful of when taking out D&O insurance. Lawyers who are experienced in the field of company law can advise businesses and their managers.

https://www.grprainer.com/en/legal-advice/company-law/do-insurance.html

GRP Rainer LLP www.grprainer.com/en/ is an international firm of lawyers and tax advisors who are specialists in commercial law. The firm counsels commercial and industrial companies and corporations, as well as associations, small- and mid-sized businesses, self-employed freelancers and private individuals worldwide from offices Cologne, Berlin, Bonn, Dusseldorf, Frankfurt, Hamburg, Munich, Stuttgart and London UK.

Contact
GRP Rainer LLP
Michael Rainer
Augustinerstraße 10
50667 Cologne
Phone: +49 221-27 22 75-0
Fax: +49 221-27 22 75-24
E-Mail: info@grprainer.com
Url: http://www.grprainer.com/en

Politics Law Society

No registration of „Bester Papa“ as EU trade mark due to lack of distinctiveness

No registration of „Bester Papa“ as EU trade mark due to lack of distinctiveness

No registration of "Bester Papa" as EU trade mark due to lack of distinctiveness

In order for a trade mark to be capable of being registered as a European Union trade mark it needs to be highly distinctive. The slogan „Bester Papa“ („Best dad(dy)/papa“) lacks this distinctive character.

The protection afforded by a trade mark is vitally important to businesses. Among consumers, trade marks give rise to a high level of brand recognition. Registering a trade mark also affords protection from competitors who would otherwise be able to benefit from its success. That being said, not every mark can be registered as a trade mark. We at the commercial law firm GRP Rainer Rechtsanwälte note that registration requires a highly distinctive character. That is why, for instance, the General Court of the European Union rejected the registration of the mark „Bester Papa“ as an EU trade mark in its judgment of September 15, 2017 (Az.: T-451/16).

Cups, t-shirts etc. with the inscription „Bester Papa“ or „Beste Oma“ („Best grandma/granny“) are very popular as gifts or tokens of recognition. For this reason, one company wanted to register the word mark „Bester Papa“ as an EU trade mark. However, the European Union Intellectual Property Office (EUIPO) completely rejected its registration. In justifying its decision, it stated that the mark lacked the necessary distinctive character, and that consumers would consider the two words commonplace and merely a promotional message. It went on to say that no part of the mark was capable of being interpreted by consumers as an indication of the goods“ commercial origin.

The company was unsuccessful in bringing a legal challenge against this decision. The General Court shared the view of the EUIPO. The mark was said to be a classic slogan expressing praise and personal affection. The Court held that this combination of words is a commonplace expression that is familiar to consumers in a number of contexts. It ruled that there is no need for several associated logical steps in order to understand the mark as an expression of personal affection. The Court noted that the goods are, after all, suitable as gifts, and that this combination of words is perceived by the relevant public as nothing more than a promotional slogan. The General Court concluded that there was a lack of distinctiveness distinguishing the goods from products of other producers. Due to this lack of distinctive character, it was not possible to register the mark as an EU trade mark.

Lawyers who are experienced in the field of intellectual property law can advise businesses on registering trade marks as well as enforcing claims in the event of trade mark violations.

https://www.grprainer.com/en/legal-advice/intellectual-property-law-and-trademark-law/trademark-law.html

GRP Rainer LLP www.grprainer.com/en/ is an international firm of lawyers and tax advisors who are specialists in commercial law. The firm counsels commercial and industrial companies and corporations, as well as associations, small- and mid-sized businesses, self-employed freelancers and private individuals worldwide from offices Cologne, Berlin, Bonn, Dusseldorf, Frankfurt, Hamburg, Munich, Stuttgart and London UK.

Contact
GRP Rainer LLP
Michael Rainer
Augustinerstraße 10
50667 Cologne
Phone: +49 221-27 22 75-0
Fax: +49 221-27 22 75-24
E-Mail: info@grprainer.com
Url: http://www.grprainer.com/en

Politics Law Society

Walther Trowal cuts processing times for finishing of blisks from several days to a few hours

Surface finishing of components for the aerospace industry

Walther Trowal cuts processing times for finishing of blisks from several days to a few hours

The work bowl of the “CM” rotary vibrator.

For the efficient surface finishing of high value work pieces like blisks for airplane and land based turbines, Walther Trowal has redesigned its CM vibratory system. It ensures that the work pieces receive a uniform, homogeneous high quality finish with absolutely repeatable results.

The surface finish of blisks („Blade Integrated Disks“) in airplane and other turbines affects to a large extent the airflow characteristics and, thus, the overall efficiency, fuel consumption and noise emissions.

To date the surface finishing of blisks was done manually with grinding disks and other manually operated tools. Due to the „human factor“ the quality of the final finish could greatly vary between work pieces. Frequently, it could even happen that certain surface areas were not finished at all.

For the consistent and high quality finishing of circular high value components Walther Trowal redesigned the rotary vibrator „CM“ in close cooperation with leading turbine manufacturers to make it more suitable for treating all kinds of turbine components.

The „CM“ system allows deburring and general surface improvement of components with diameters of up to 980 mm.

Single work pieces are mounted to the inner dome of the processing bowl. The height of the inner dome itself has been drastically shortened. After grinding media has been filled into the bowl, a vibratory motor causes the complete work bowl to vibrate. This causes a constant „rubbing“ of the media against the fixed work piece. Since the „rubbing“ action is highly homogeneous, a uniform, even finish on all surface areas of the disk and blades is achieved. After completion of the process the surface roughness readings amount to Ra = 0.2 to 0.4 µm.

Starting with an initial surface roughness of Ra = 4 to 5 µm, the desired finishing results are achieved within about five to six hours. Compared to this innovative method the manual finishing of blisks can take several days.

Christoph Cruse, sales manager at Walther Trowal, is commenting on the special conditions prevailing in the aerospace industry: „Especially for the production of turbine components any manual manufacturing operations must be viewed with great skepticism, because the quality of the work will vary greatly. With our new finishing machine we have completely eliminated the vagaries of the human factor. And, we can reduce the finishing times for blisks from several days to just a few hours“.

For finishing of blisks Walther Trowal is recommending the special finishing media, type V 2030. This media produces very smooth surface finishes on materials and shapes, which are typical for blisks. Of course, the V 2030 media is globally approved for the aerospace industry.

Walther Trowal at Singapore Airshow, February 6 – 11 2018
Booth L82

For 85 years Walther Trowal has been a pioneer and market leader in various surface treatment technologies. The company offers modular and custom engineered solutions for a wide range of surface treatment problems.

Initially only making vibratory finishing equipment, over the years Walther Trowal has continuously broadened its product range and today offers a wide portfolio of equipment and services for improving all kinds of surfaces, e.g. mass finishing, part cleaning, shot blasting and drying of a wide spectrum of work pieces, last but not least, the coating of mass produced small parts.

Walther Trowal offers not only various types of equipment but complete surface treatment systems: By linking the various equipment modules and automating the complete process, we are able to precisely adapt our process technologies to the technical requirements of our customers. This also includes various types of peripheral equipment and process water cleaning and recycling systems. Of course, we also offer comprehensive pre- and after-sale service like sample processing in one of our demonstration labs and global repair and maintenance service.

Walther Trowal serves many customers in many industries around the world. For example, in the automotive and aerospace industry, medical engineering and wind power generation.

Company-Contact
Walther Trowal GmbH & Co.KG
Martin Huebner
Rheinische Str. 35-37
42781 Haan/Germany
Phone: +49 2129.571-209
Fax: +49 2129.571-225
E-Mail: m.huebner@walther-trowal.de
Url: http://www.walther-trowal.de

Press
VIP Kommunikation
Regina Reinhardt
Dennewartstraße 25-27
52068 Aachen/Germany
Phone: +49.241.89468-24
Fax: +49.241.89468-44
E-Mail: reinhardt@vip-kommunikation.de
Url: http://www.vip-kommunikation.de

Politics Law Society

BGH: A square shape can also be protected as a trademark

BGH: A square shape can also be protected as a trademark

BGH: A square shape can also be protected as a trademark

Three-dimensional symbols that represent the shape of a product can be protected as a trademark. That was the verdict of the Bundesgerichtshof (BGH), Germany“s Federal Supreme Court, in two rulings from October 18, 2017 (Az.: I ZB 3/17 and I ZB 4/17).

We at the commercial law firm GRP Rainer Rechtsanwälte note that the three-dimensional shape of a product is capable of being protected as a trademark pursuant to trademark law if the shape is not required exclusively for the purposes of producing a technical effect.

A chocolate manufacturer and a dextrose manufacturer had their three-dimensional symbols registered as trademarks. Competitors of theirs did not want to leave it at that and instead filed an application for cancellation of the trademarks. The dispute ultimately came before the Bundesgerichtshof.

Prior to this, the Bundespatentgericht, Germany“s Federal Patent Court, had ordered that both trademarks be cancelled, it having recognized only technical functions in all of the essential characteristics of the shapes of the products shown in the trademarks. However, the BGH overturned the rulings and referred the cases back to the Bundespatentgericht. It was said that the only symbols that should be excluded from trademark protection are those which consist solely of a shape that is required for the purposes of producing a technical effect. According to the 1st Civil Panel of the BGH, competent to hear cases pertaining to trademark law, among other things, this was neither the case in relation to the chocolate nor the dextrose.

In the case of the dextrose, the Panel held that the specially shaped rough edges of the tablets do not have a technical function but are instead meant to make consumption more pleasant for consumers. This was said to have a sensory effect. The Court went on to say that in the case of the chocolate there was also no essential functional characteristic associated with its square shape. It is possible for even three-dimensional symbols, including the shape of a product, to be admitted as trademarks if they are capable of distinguishing goods and services from one company from the products of another company.

The Bundespatentgericht will now have to rule on whether there are other grounds excluding trademark protection for both of the products.

Trademarks are an asset of significant value to businesses that ought to be protected. However, for this to happen it needs to be assessed whether the conditions for registering a symbol as a trademark are fulfilled. Moreover, rights pertaining to existing trademarks cannot be infringed. Lawyers who are experienced in the field of intellectual property law can advise on all issues relating to registering a trademark and trademark protection.

https://www.grprainer.com/en/legal-advice/intellectual-property-law-and-trademark-law/trademark-law.html

GRP Rainer LLP www.grprainer.com/en/ is an international firm of lawyers and tax advisors who are specialists in commercial law. The firm counsels commercial and industrial companies and corporations, as well as associations, small- and mid-sized businesses, self-employed freelancers and private individuals worldwide from offices Cologne, Berlin, Bonn, Dusseldorf, Frankfurt, Hamburg, Munich, Stuttgart and London UK.

Contact
GRP Rainer LLP
Michael Rainer
Augustinerstraße 10
50667 Cologne
Phone: +49 221-27 22 75-0
Fax: +49 221-27 22 75-24
E-Mail: info@grprainer.com
Url: http://www.grprainer.com/en

Politics Law Society

Truck cartel – Damages claims against Scania now also a possibility

Truck cartel – Damages claims against Scania now also a possibility

Truck cartel - Damages claims against Scania now also a possibility

Last summer, the European Commission imposed heavy fines on five truck manufacturers for violations of antirust law. The Swedish truck manufacturer Scania is now being asked to pay up as well.

The so-called „truck cartel“ made headlines last summer. The European Commission had imposed fines totaling just under 2.9 million euros against the manufacturers MAN, Daimler, DAF, Iveco and Volvo/Renault for entering into illegal arrangements. Scania did not participate in the settlement and disputed the antirust accusations. Consequently, the European Commission continued its investigations in relation to Scania. The result: The Commission announced on September 27, 2017 that the truck manufacturer must now pay a fine of around 880 million euros for violating EU antitrust rules.

The cartel members had entered into illegal arrangements between 1997 and 2011. The Commission has since concluded that Scania was also involved in these arrangements over a period of 14 years. These concerned, in particular, agreements pertaining to the gross list price for medium and heavy-duty trucks, concerning the timetable for the introduction of technologies designed to lower emissions as well as passing on these costs to customers. The cartel covered the entirety of the European Economic Area (EEA).

Now that the Commission“s investigations have come to an end, all those who were harmed by the cartel, private individuals and businesses alike, are now able to assert damages claims against the cartel members. We at the commercial law firm GRP Rainer Rechtsanwälte note that the aggrieved parties are expected to have paid inflated prices between 1997 and 2011 for trucks that were approximately 10 to 20 per cent higher in price than they ought to have been, irrespective of whether they were purchased or leased. The advantage of this is that it is no longer necessary to prove unlawful conduct on the part of the cartel members, and this paves the way for damages claims. It is worth noting here that the extent of any harm caused may substantially exceed the fines. Those concerned can turn to lawyers who are experienced in the field of antitrust law to enforce and protect their interests.

Many businesses have suffered considerable harm resulting from these illegal cartel arrangements. It is now possible to obtain compensation for this financial loss and in so doing potentially preserve businesses“ competitiveness.

https://www.grprainer.com/en/legal-advice/antitrust-law.html

GRP Rainer LLP www.grprainer.com/en/ is an international firm of lawyers and tax advisors who are specialists in commercial law. The firm counsels commercial and industrial companies and corporations, as well as associations, small- and mid-sized businesses, self-employed freelancers and private individuals worldwide from offices Cologne, Berlin, Bonn, Dusseldorf, Frankfurt, Hamburg, Munich, Stuttgart and London UK.

Contact
GRP Rainer LLP
Michael Rainer
Augustinerstraße 10
50667 Cologne
Phone: +49 221-27 22 75-0
Fax: +49 221-27 22 75-24
E-Mail: info@grprainer.com
Url: http://www.grprainer.com/en

Politics Law Society

Wallpaper cartel – Heavy fines for illegal price fixing

Wallpaper cartel – Heavy fines for illegal price fixing

Wallpaper cartel - Heavy fines for illegal price fixing

In its ruling of October 12, 2017, the Oberlandesgericht (OLG) Düsseldorf [Higher Regional Court of Düsseldorf] imposed fines totalling more than 19 million euros against members of the so-called Tapeten-Kartell, or „wallpaper cartel“ (Az.: V-2 Kart 1-3/17).

The 2nd Cartel Division of the OLG Düsseldorf came to the conclusions after 20 days of the trail that the cartel members had entered into illegal price-fixing agreements. According to the Court, the cartelists had agreed to a price increase for wallpaper in Germany to the tune of between 5 and 6 per cent in 2005. The 2nd Division noted that one of the carpet manufacturers as the market leader played a prominent role in this. A further anti-competitive arrangement in 2008 was said to have led to another price increase of about 5 per cent in the German market.

By imposing fines of around 19 million euros in total, the OLG Düsseldorf has in part gone substantially beyond the fines imposed by the Bundeskartellamt, Germany“s Federal Cartel Office. Key to this was the 2nd Division taking the global turnover of the companies in question as its basis. The Bundeskartellamt had already imposed fines in 2014 in the amount of approximately 17 million euros for illegal price-fixing arrangements. Two of the carpet manufacturers then lodged an appeal against this decision at the OLG Düsseldorf, but to no avail. Having said that, the OLG Düsseldorf“s ruling is not yet final.

We at the law firm GRP Rainer Rechtsanwälte note that the carpet manufacturers concerned are not yet able to put the matter to rest, as they might still be faced with damages claims brought by large clients who were harmed by the illegal price-fixing agreements. Lawyers who are experienced in the field of antitrust law can assess whether damages claims are justified and enforceable.

Anti-competitive price-fixing arrangements are a clear violation of antitrust law. That being said, it is possible for violations to occur quite unwittingly and despite this be harshly punished. Even minor details in contractual clauses, for instance, can give rise to violations of antitrust law. For this reason, it is advisable to have agreements reviewed by experienced lawyers with a view to concerns from the perspective of antitrust law.

https://www.grprainer.com/en/legal-advice/antitrust-law.html

GRP Rainer LLP www.grprainer.com/en/ is an international firm of lawyers and tax advisors who are specialists in commercial law. The firm counsels commercial and industrial companies and corporations, as well as associations, small- and mid-sized businesses, self-employed freelancers and private individuals worldwide from offices Cologne, Berlin, Bonn, Dusseldorf, Frankfurt, Hamburg, Munich, Stuttgart and London UK.

Contact
GRP Rainer LLP
Michael Rainer
Augustinerstraße 10
50667 Cologne
Phone: +49 221-27 22 75-0
Fax: +49 221-27 22 75-24
E-Mail: info@grprainer.com
Url: http://www.grprainer.com/en

Politics Law Society

GRP Rainer Rechtsanwälte – Experience with D&O insurance

GRP Rainer Rechtsanwälte – Experience with D&O insurance

GRP Rainer Rechtsanwälte - Experience with D&O insurance

Taking out a D&O insurance policy is supposed to reduce executives“ risk of liability. Experience shows that it is crucial to pay attention to details when taking out a policy.

Mistakes made by a company“s executive bodies can have serious consequences for the entire business. Managers bear an extremely high level of responsibility for the company they work for and its staff. In addition to this responsibility, executive bodies are also subject to a high risk of personal liability. A lot of companies take out a D&O insurance policy for their executive staff as a way of reducing this risk. If an event covered by the insurance policy occurs, it is nonetheless possible for a dispute with the insurer to emerge if it does not wish to stand good for the loss. Experience shows that the policy ought to be tailored to the individual liability risks faced by a given manager. We at the commercial law firm GRP Rainer Rechtsanwälte note that this is the best way to prevent a legal dispute with the D&O insurance company.

The executive organs attend to different tasks within a company. The more varied these tasks are, the more nuanced the D&O insurance policy should be drafted to ensure optimal coverage of the various liability risks.

Even careless mistakes can give rise to substantial consequences for managers and trigger internal as well as external personal liability. Accordingly, a D&O insurance policy should always cover the risk of both internal and external liability. The coverage agreed, i.e. the insured amount, is, of course, also a matter of vital important.

It is equally important to consider aspects pertaining to coverage of retroactive and follow-up liability alike. In the case of retroactive coverage, the insurer commits to step in even in liability cases that have arisen before the D&O insurance policy was concluded but only came to light afterwards. By contrast, the insurer assumes follow-up liability in liability cases that arose during the term of the policy but were only discovered later on.

Even if the D&O insurance policy covers the key liability risks, it is still always possible in an emergency that the insurer will not want to assume liability in the event of a claim. Lawyers who are experienced in the field of company law can advise companies when taking out a D&O insurance policy and enforce claims against the insurance company.

https://www.grprainer.com/en/legal-advice/company-law/do-insurance.html

GRP Rainer LLP www.grprainer.com/en/ is an international firm of lawyers and tax advisors who are specialists in commercial law. The firm counsels commercial and industrial companies and corporations, as well as associations, small- and mid-sized businesses, self-employed freelancers and private individuals worldwide from offices Cologne, Berlin, Bonn, Dusseldorf, Frankfurt, Hamburg, Munich, Stuttgart and London UK.

Contact
GRP Rainer LLP
Michael Rainer
Augustinerstraße 10
50667 Cologne
Phone: +49 221-27 22 75-0
Fax: +49 221-27 22 75-24
E-Mail: info@grprainer.com
Url: http://www.grprainer.com/en

Politics Law Society

GRP Rainer Rechtsanwälte – Report on GmbH managing director“s obligation to contribute to social security

GRP Rainer Rechtsanwälte – Report on GmbH managing director“s obligation to contribute to social security

GRP Rainer Rechtsanwälte - Report on GmbH managing director"s obligation to contribute to social security

Whether the managing director of a GmbH, a type of German private limited liability company, is obligated to make contributions to social security is frequently a point of contention. Various different factors need to be considered when weighing things up.

According to a report by the commercial law firm GRP Rainer Rechtsanwälte, a lack of awareness regarding a managing director“s obligation to contribute to social security is particularly liable to give rise to problems when a GmbH is being established. If the managing director is obliged to make contributions to social security but no contributions are made, we at GRP Rainer Rechtsanwälte note that there is then the possibility of having to make large back payments which have the potential to threaten a young company“s existence.

The obligation to contribute to social security encompasses contributions to unemployment, pension, health and nursing care insurance as well as accident insurance. Whether a managing director is obliged to make contributions depends on whether he is employed or self-employed.

Externally hired managing directors are employees in most cases. The usual criteria for a dependent employment relationship is that the individual in question be integrated into the external company and that the employer have the authority to give instructions in relation to the place of work, working hours and the type of work to be performed.

It is more difficult to make a distinction in cases involving managing directors who are also shareholders. In these instances, it needs to be examined whether the managing director is in fact carrying out his work independently. Key factors in determining whether this is the case is whether a personal business risk has been entered into and the share in the company“s capital. In cases where the share in the business is greater than 50 per cent, the managing director has substantial influence over the fate of the company, meaning that it can be assumed that he or she is self-employed and thus subject to the obligation to make contributions to social security. This can also be true of minority shareholdings if the managing director has a comprehensive blocking minority or has free reign in relation to his or her workforce as well as place of work and working hours.

Having said all of that, when it comes to classifying an occupation as an employed or self-employed role it is not only the contractual framework but also the actual content and drafting that are decisive, as these may in practice deviate from the contractual arrangements.

The first step should therefore always be to establish whether there is an obligation to contribute to social security. Contractual arrangements that are designed only to circumvent this obligation can have expensive repercussions in the form of back payments if the actual circumstances give rise to an obligation to make contributions to social security. If, on the other hand, these circumstances allow for an exemption from said obligation, the contracts can be prepared accordingly.

Lawyers who are experienced in the field of company law can advise shareholders and managing directors.

https://www.grprainer.com/en/legal-advice/company-law.html

GRP Rainer LLP www.grprainer.com/en/ is an international firm of lawyers and tax advisors who are specialists in commercial law. The firm counsels commercial and industrial companies and corporations, as well as associations, small- and mid-sized businesses, self-employed freelancers and private individuals worldwide from offices Cologne, Berlin, Bonn, Dusseldorf, Frankfurt, Hamburg, Munich, Stuttgart and London UK.

Contact
GRP Rainer LLP
Michael Rainer
Augustinerstraße 10
50667 Cologne
Phone: +49 221-27 22 75-0
Fax: +49 221-27 22 75-24
E-Mail: info@grprainer.com
Url: http://www.grprainer.com/en

Politics Law Society

LAG Rheinland-Pfalz: Dismissal with immediate effect for damage to property effective

LAG Rheinland-Pfalz: Dismissal with immediate effect for damage to property effective

LAG Rheinland-Pfalz: Dismissal with immediate effect for damage to property effective

Serious breaches of duty by an employee may justify dismissal with immediate effect. Damage to property can constitute good cause justifying exceptional notice of dismissal with immediate effect.

An employer is able to issue exceptional notice of dismissal with immediate effect if it has good cause for doing so and the individual circumstances of the respective case have been sufficiently accounted for. In order for notice of dismissal to be issued effectively, the grounds need to be sufficiently serious such that it would no longer be reasonable to expect the employer to continue the employment relationship. One good cause that may justify dismissal with immediate effect is property damage committed by the employee, as shown by a ruling of the Landesarbeitsgericht (LAG) Rheinland-Pfalz [Regional Labour Court of Rhineland Palatinate] from December 19, 2016 (Az.: 3 Sa 356/16).

In the case in question, an employee had been issued with exceptional notice of dismissal with immediate effect after having struck a touchscreen monitor out of frustration and thereby shattered the glass of the screen. The employee had previously been informed he would only be receiving a small personal profit-sharing bonus. He had already received a formal written warning for similar reasons several months prior to this.

The dismissed worker raised an action for wrongful dismissal but was unsuccessful. The LAG Rheinland-Pfalz held that by damaging the monitor the employee had committed a serious breach of duty pursuant to his employment contract, and that the employer had incurred a financial loss as a result of this. Moreover, the damage was said to have given rise to a potential hazard because the incident had occurred in a potentially explosive environment. The Court stated that equipment in these kinds of potentially dangerous environments cannot be altered or manipulated as this would impinge on the safety measures in place and safety could no longer be guaranteed. In addition, the Court also noted that the plaintiff had already been issued with a formal warning for a similar breach of duty.

The LAG concluded after weighing up the parties“ mutual interests and considering all of the facts and circumstances of the case that it was no longer reasonable to expect the employer to continue the employment relationship. By damaging the monitor, the employee was said to have not only acted contrary to the employer“s interests but also severely undermined the trust placed in him. The Court went on to point out that not even the formal warning had caused the employee to refrain from his unsafe behavior.

Whether notice of dismissal with immediate effect has been issued effectively is always a case-by-case decision. Employers should therefore carefully prepare before issuing notice of dismissal. Lawyers who are experienced in the field of employment law can advise on all issues pertaining to the workplace.

https://www.grprainer.com/en/legal-advice/employment-law.html

GRP Rainer LLP www.grprainer.com/en/ is an international firm of lawyers and tax advisors who are specialists in commercial law. The firm counsels commercial and industrial companies and corporations, as well as associations, small- and mid-sized businesses, self-employed freelancers and private individuals worldwide from offices Cologne, Berlin, Bonn, Dusseldorf, Frankfurt, Hamburg, Munich, Stuttgart and London UK.

Contact
GRP Rainer LLP
Michael Rainer
Augustinerstraße 10
50667 Cologne
Phone: +49 221-27 22 75-0
Fax: +49 221-27 22 75-24
E-Mail: info@grprainer.com
Url: http://www.grprainer.com/en