In the wake of the pandemic, many companies have had their employees working from home or allowed them to work remotely. Now, with vacant office space (often in expensive, prime locations) and deteriorating team cohesion, many employers want their employees back in the office. This doesn’t always meet with approval from employees, many of whom don’t want to give up the option of working remotely. What can employers do if employees refuse?

If home office or remote working has been introduced by means of a supplementary employment agreement and this agreement includes provisions on termination, employers are able to make use of this option. This has now been decided by the Hamm Regional Labour Court (LAG), in a decision from 16 March 2023.

The parties entered into a supplementary agreement on working from home in November 2016. This allowed the employee in question to perform most of his work from home. The agreement contained a termination option, subject to giving one month’s notice. The agreement did not refer to any specific grounds for termination. Upon the effective termination of the agreement, the employee would be obliged to return to work at the company’s premises. Following a lengthy period in which the employee had been unwell, the employer terminated the agreement. The employee challenged this decision.

The Hamm Regional Labour Court rejected the employee’s challenge. Under German law, partial termination (i.e. termination of individual contractual terms) is generally not allowed. However, partial termination may be allowed if this has been contractually agreed by the parties. If employers terminate contracts in this way, they do not have to comply with the German Dismissal Protection Act (KSchG). This is because this kind of termination does not concern the main, reciprocal obligations of the employment relationship, but the subsidiary matter of whether the employee can perform their work from home. Determining the place that work is to be performed is a question of the way in which work is to be performed.

The LAG left open the question of whether the supplementary agreement or, in any case, the provision on the partial termination were ‘general’ terms and conditions, holding that even if they were, they would not be invalid under relevant provisions of the German Civil Code (BGB). The partial termination did not cause any ‘unreasonable disadvantage’ to the employee. The court held that determining of the place work is to be performed is subject to the employer’s right of direction, and that the agreement did not deviate from applicable legal principles under the Trade Regulations (GewO).

This case reminds us that anyone who sets out on a path should also consider the way back. After all, you never know what the future will bring. Where new ways of working are permitted, a termination solution—whether in the form of a time limit and/or a termination option—should always be agreed. This applies not only to individual agreements, but also to collective agreements. The LAG’s ruling does not set the requirements for a valid termination option too high, and this leaves welcome scope for employers on this point.

If a company has a works council, its participation rights may have to be taken into account when managing a return to the office. But here, too, the employer has room to manoeuvre. Whether home office or remote working continues to be offered is a corporate decision that is not subject to co-determination. At most, co-determination rights can arise concerning implementation (i.e. the ‘how’). If employees continue to be given the opportunity to work at least partially from home or remotely, and can choose their own office days, requiring them to return to the office will not amount to a ‘transfer’ under the Works Constitution Act (BetrVG).