Pregnancy Ruling Eases Dismissal Challenge as German Companies Press Ahead with Thousands of Job Cuts

BAG ruling allows late dismissal claims if pregnancy unknown; Evonik cuts 1,850 jobs, IKEA and Valeo reduce headcount, while AI-driven job losses spark union demands and ILO wage concerns.

The Bundesarbeitsgericht (BAG), Germany's highest labor court, issued a ruling in early June that strengthens protections for pregnant workers. Employees who miss the statutory three-week deadline to contest a dismissal can still bring a claim if they were unaware of their pregnancy at the time, provided a medical certificate confirms they had no fault in the delay. The decision adds a new layer of security for women facing job loss during early pregnancy.

While the BAG opened that door, employers across Germany are closing others. The specialty chemicals group Evonik is pushing ahead with plans to cut 1,850 positions. Around 1,000 of those reductions will happen this year, with the remaining 850 set for next year. Management has ruled out compulsory redundancies until 2032 as part of the restructuring program "Evonik Tailor Made," which targets annual savings of €400 million by the end of 2026.

Elsewhere, the furniture retailer IKEA is eliminating 233 jobs at its Dortmund-Ellinghausen site. At the automotive supplier Valeo in Mühlhausen, a plant closure has been postponed until the end of 2027, but 163 employees are still affected. Under the agreement, affected workers enter a twelve-month transfer company arrangement and receive minimum severance of €20,000. Union members get extra payments on top.

Workplace transformation driven by artificial intelligence is adding further pressure. The DGB Berlin-Brandenburg trade union is demanding binding early involvement of works and staff councils in the rollout of "LLMoin," an AI language model being introduced by the state's DigitalAgentur Brandenburg (DABB). The union criticises the lack of consultation and calls for an overhaul of the state's personnel representation law. Separately, the Swiss Post cited growing use of AI as one reason for cutting roughly 60 IT positions; a consultation procedure is set to begin in mid-June.

Speaking in Geneva, International Labour Organization (ILO) Director-General Gilbert Houngbo argued that productivity gains from AI must translate into higher wages rather than simply destroying jobs. The ILO's own projections suggest that global economic tensions could put millions of full-time jobs at risk by 2026.

On the legal front, the Landesarbeitsgericht Niedersachsen ruled that company-wide employee surveys used to investigate criminal acts are permissible, provided the questions are fact-based. Data protection rules do not override that right, the court found. In cases involving disabled workers, courts are requiring integration offices to thoroughly examine the link between the employee's disability and the alleged misconduct before approving dismissals. Experts also point to formal hurdles in elections for disabled workers' representatives: employees in the passive phase of partial retirement (Altersteilzeit) are not entitled to vote.

Severance negotiations are becoming more fraught, especially for managers. The number of unemployed executives rose sharply last year. Labour lawyers advise managers facing separation agreements to insist on a reflection period of at least seven to fourteen days and to seek professional advice. While rank-and-file employees typically receive around half a month's salary per year of service, the guideline for executives is one gross monthly salary per year of service as a starting point for negotiations. No statutory right to severance pay exists.