01.10.2024 – NEWS: New article on “Criminal liability of embezzlement in connection with works council remuneration” available in ZfIStw

01.10.2024

The amount of works council remuneration has become a permanent factor of uncertainty in practice. Our associate Sascha Knaupe has now published a new article on this relevant current topic together with Anne-Kathrin Bertke (Kliemt Employment Law). The article has been published in the Journal of International Criminal Law (ZfIStw) and is available free of charge. Read the article

At the same time this new article was set up for printing, German parliament adopted an amendment to the Works Constitution Act (BetrVG) in order to clarify the issue of remuneration of works council members.

The article by Knaupe/Bertke remains relevant and worth reading even even after this short-notice amendment – especially with regard to risks of criminal liability due to embezzlement for managers, and measures to be taken.

For interested readers, the latest changes made by the legislator are here summarized in brief:

• Companies have recently faced increased legal uncertainty regarding the suitable remuneration of works council members – and as a result, frequently applied preventive cuts.
• The legislator has now supplemented the prohibition of discrimination in the remuneration of works council members with a minimum remuneration claim. In future, their remuneration may not be less than the remuneration of comparable employees with normal company development.
• Section 37 of the Works Constitution Act (BetrVG) specifies the term “comparable employee”. The standard for remuneration as for a comparable employee is to be the time at which individual works council members took over their function (unless a later redetermination is objectively justified).
• Employers and works councils will be enabled to define “comparable employees” in works agreements. Resulting works agreements should be ruled out to be checked unless for gross errors.
• Section 78 of the Works Constitution Act (BetrVG) is supplemented by the clarification that no preferential treatment or disadvantage with regard to the remuneration paid may be suspected if the works council member meets the operational requirements for this.