Exemption during the notice period and malicious failure to seek alternative employment

An employee who is released from work by their employer following termination does not, in principle, maliciously refrain from other gainful employment within the meaning of Section 615 sentence 2 of the German Civil Code (BGB) if they do not enter into a new employment relationship before the end of the notice period. This article explains exactly what this means.

The current case: suspension and wage claim

In the underlying case, the employer terminated the employment relationship by letter dated 29 March 2023 with effect from 30 June 2023. At the same time, it irrevocably released the employee from his duties, taking into account his remaining holiday entitlement. The labour court upheld the employee’s action for unfair dismissal. The employer’s appeal was dismissed on 11 June 2024. So far, so good.

The employee registered as unemployed after receiving the notice of termination at the beginning of April and received job offers from the employment agency for the first time at the beginning of July. The employer, on the other hand, sent him a total of 43 job offers in May and June 2023, which it considered suitable for the employee.

The employee applied for seven of these positions at the end of June 2023. Since the employer did not pay the employee any remuneration for June 2023 – i.e. while the employment relationship was still ongoing – he sued for payment. The employer requested that the claim be dismissed on the grounds that the employee was obliged to apply for the job offers provided by the employer in a timely manner during the period of leave. Since he had not done so, the employee must accept the fictitious alternative earnings.

The court ruling: No deduction in the event of exemption

The labour court initially dismissed the claim. However, the regional labour court upheld the employee’s appeal, and the Federal Labour Court (BAG) confirmed this decision. Ultimately, the business was found to be in default of acceptance due to the unilateral release of the employee during the notice period. The business owes the employee the agreed remuneration for the entire duration of the notice period.

According to Section 615, sentence 2 of the German Civil Code (BGB), the employee does not have to offset any other earnings that were not achieved. Offsetting fictitious other earnings would only be justified if the employee had remained inactive contrary to good faith.

In principle, the employer must continue to employ the employee during the notice period. However, since the employer did not demonstrate that it would have been reasonable to continue employing the employee until the end of the notice period, the employee was not obliged to enter into another employment relationship prematurely, even to ease the financial burden on the employer.

What does this mean for employers?

The ruling clarifies that offsetting malicious failure to seek other employment during the notice period will only be conceivable in exceptional cases. However, after the notice period has expired, the employer should provide its former employee with suitable job offers in a verifiable manner, as offsetting other (notional) earnings is possible from this point onwards.