Zalando’s €70 Million Gap Highlights Stakes as German Top Court Slams Door on Layoff Fixes
22.06.2026 - 18:09:13 | boerse-global.de
The standoff over social-plan costs at Zalando’s Erfurt site—where the employer offers €30 million and the works council demands €100 million—underscores just how high the price of procedural missteps has become. With roughly 2,000 positions affected, the dispute must be resolved by a mediation board before July 9, 2026.
The stakes are magnified by a pair of landmark rulings from Germany’s Federal Labour Court (BAG) dated April 1, 2026 (Case Nos. 6 AZR 157/22 and 6 AZR 152/22). Once a mass-layoff notification to the Federal Employment Agency is filed prematurely—before the mandatory consultation with the works council concludes—the error cannot be corrected later. Dismissals based on that notification become permanently void.
The BAG grounded its decision in a European Court of Justice (ECJ) interpretation handed down on October 30, 2025, effectively tightening the screws on employers who attempt a quick filing only to discover they jumped the gun.
Notification thresholds remain strict: in workplaces with 21 to 59 employees, more than five dismissals within 30 days trigger the duty. For 60 to 499 staff, the trigger is either more than 10 percent of the workforce or more than 25 dismissals. Above 500 employees, at least 30 dismissals are reportable.
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Social Selection Meets Artificial Intelligence
The core of any operational dismissal remains the social selection under Section 1(3) of the Protection Against Unfair Dismissal Act (KSchG). Criteria include length of service, age, family-maintenance obligations, and severe-disability status. Companies are increasingly turning to artificial-intelligence tools to process the data—but the legal risks are considerable.
The BAG has not yet ruled on AI-driven selection directly, but existing case law makes clear that the final decision must rest with the employer. The logic used by any AI system must be transparent and verifiable. Under Section 95(2a) of the Works Constitution Act (BetrVG), works councils have a co-determination right when such tools are introduced. If the scoring remains opaque, any resulting dismissals are vulnerable to challenge.
One exception exists in insolvency proceedings: if a reconciliation of interests (Interessenausgleich) includes a named list of affected employees, the social selection is presumed justified and can only be reviewed for gross errors.
Parental Leave, Delivery Proof, and Home Office
A separate BAG ruling on June 18, 2026 (Case No. 2 AZR 213/25) clarified that anti-dismissal protection applies separately to each period of parental leave. Employers must reassess the situation every time an employee returns from leave.
Serving a termination notice has also grown trickier. Since a May 7, 2026 judgment, a registered letter dropped in the recipient’s mailbox no longer automatically proves actual receipt. Companies must adjust their delivery methods to avoid disputes over whether the notice ever arrived.
The Düsseldorf Labour Court (Case No. 3 Ca 6587/25) bolstered home-office rights: a blanket cancellation of remote-work days is invalid unless the employer provides sufficient operational grounds. In the case at hand, the IT employee’s contacts all worked remotely anyway, so generic communication or supervision concerns failed to justify the cutback.
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Broader Trends: Workforce Data and Rising Costs
While planned dismissals at municipal facilities in Hohenmölsen were temporarily averted, the national picture shows persistent pressure. The 2026 Dismissal Atlas reports that 57.4 percent of those laid off were men. The average age stood at 41.4 years, the average salary at €3,319 per month. Severance payments negotiated in settlements averaged €7,393.
Labour costs continue to climb. Since January 1, 2026, the statutory minimum wage has been €13.90 per hour, with the mini-job ceiling at €556. A further increase to €14.60 is scheduled for January 1, 2027.
