Project example :

"Interim Manager for Labour Law"

Interim Manager for Labour Law

This company was a well-known handling agent at Berlin Airports (BFG). Low ticket prices tend to translate into strong competition between the airlines. The airlines pass this pressure on to other service providers – as was the case with my client. A restructuring of the company was unavoidable. On the one hand, the business was having an international law firm advise it on Labour Law. At the same time, it was looking for an experienced Interim Manager specialising in Labour law to implement the upcoming change phase.

Project »Interim Manager for Labour Law «

For many years now, the employees at the client had taken cognisance of the strong price pressure aviation faced and had organised themselves professionally for any eventuality. The company boasted very experienced and highly-trained Works Councils who had gone all out to exercise their participation rights in a manner that counted. As Interim Manager for Labour Law, I was to support the client in the area of the legislation pertaining to the Works Council Constitution Act (the act in Germany governing Constitutional Rights in the workplace i.e. BetrVG) and also represent the company in Labour Law. The goal was to secure the implementation of the restructuring through Interim Management and at the same time reduce the legal costs.

My duties as Interim Manager for Labour Law were:

Advice in the field of legislation pertaining to the Works Council Constitution Act
Implementation of Works Council participation in change measures
Supervising substitution of consent proceedings before the Labour Court
Devising a concept for the implementation of operational changes in accordance with Section 111 of the Works Council Constitution Act (BetrVG)
Negotiation of reconciliation of interests and social plan
Negotiation of company agreements
Advice in the field of Individual Employment Law
Adaptation of the documents that served as the template for employment contracts
Consultation on the flexibilisation of working conditions
Applying for a permit to engage in temporary personnel leasing
Negotiation of termination agreements
Answering legal questions on occupational pension schemes

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Course of the project

In the course of the impending restructuring, the client performed an extensive staff reorganisation. Production costs were analysed in great detail. What transpired from this was the fact that personnel costs constituted the greatest impact on pricing when it came to the airlines. Certain employee groups had high vested rights regarding social benefits from old collective agreements. These were employees grouped high up on the collective agreement scale, but even with that the case, they were also no longer receiving customary additional benefits. In order to be competitive again in the future, the client assigned certain airline products to the individual departments. The employees had the opportunity to apply for the jobs in the individual products under changed conditions. For more flexibility, the company wanted to use only temporary staff in certain products. In this way, achieving a reduction in a staff surplus was possible by transferring parts of the permanent staff contingent to other companies at the airport via temporary work.

In my role as Interim Manager for Labour Law, I advised on the flexibilisation of working conditions. The main focus was on the topics of subcontracting and outsourcing, as well as the structuring of the flexibilisation of working conditions in terms of Labour Law. I also assisted the client in obtaining a permit from the Federal Employment Agency (the main public provider of employment services in Germany) allowing the client to carry out temporary employment.

Works Councils challenge

For the Works Councils, restructuring of the company proved to be difficult. Every measure taken by the employer was flatly opposed. The client was therefore forced to go to the Labour Courts to conduct substitution of consent proceedings for all restructuring decisions and to have the Works Council consent to replacement measures. The challenge for me as Interim Manager for Labour Law was therefore to manage a high number of consent substitution proceedings before the Labour Courts. Operational procedures at the client had to be understood, deadlines on the ongoing consent substitution proceedings had to be adhered to precisely and the employer's argumentation had to be substantiated meticulously.

» In restructurings, I often work together with law firms as an ‘extended workbench’. Both services complement each other perfectly. This is because I pride myself in streetwise advice focused on hands-on implementation. «

Lars Schott, HR Manager

In the Labour Court proceedings, the client was represented by its international law firm. My competence as an Interim Manager for Labour Law was to work on the client's side and relying on my knowledge of Labour Law quickly develop an understanding of operating procedures. The bottom line for restructurings: Getting good legal advice is not the be all and end all – at the end of the day the proof is in the pudding and the implementation of the measures has to succeed!

Negotiation of severance agreements

It’s common for the termination of employment relationships not to be possible during restructuring. However, in the selection process severance agreements can be negotiated with employees who enjoy a high level of protection in social benefits. As an Interim Manager for Labour Law, I bring along plenty of experience in negotiating severance agreements and am well versed in the structuring options to avoid damage to tax or unemployment benefits. The rule of thumb here always remains: the equitable negotiation of terms and conditions. Since a high number of severance agreements had to be negotiated, it was imperative that the conditions were fairly negotiated. Undermining this point could backfire because an employee who feels he or she has been ‘ripped off’ will be difficult to negotiate terminations with, in the future.

Labour Law & occupational pension provision

At airports, service contracts are often passed on to other service providers. The transfer of operations according to Section § 613a of the German Civil Code (BGB) is unavoidable. This was also the case with my client. In the past, new groups of employees were continuously integrated through numerous Business Transfer / Transfer of Undertakings actions according to § 613a BGB. Some of these employees had claims to company pension schemes from various pension schemes. As an Interim Manager for Labour law, I was commissioned to clarify any open legal issues. The management of claims from occupational pension schemes can be very time-consuming. The client therefore tried to settle certain claims through severance agreements.

A proven track record

The restructuring was completed successfully, making the company competitive and fit for the future once more. Working conditions can now be managed much more flexibly and the Labour Law contractual document templates have been brought up to date. During the project, the client updated and renegotiated numerous company agreements. As Interim Manager for Labour Law, taking into account the Labour Court rulings, I revised the draft templates for: employment contracts, termination agreements, numerous letters for personnel support, as well as the invitations for operational reintegration management. The templates were cross-checked and approved by the law firm.