Termination due to illness – is that even legal in Germany?

Some employees are afraid of being dismissed if they are sick for a longer period of time. Especially if they are unable to work for months after an accident or a serious illness. But can employees be terminated at all because of a long or many common illnesses? This blog article answers these and other questions

Terminations due to illness are generally permissible in Germany! However, there are high hurdles: A dismissal due to illness is a dismissal for personal reasons. It can be pronounced, for example, if an employee (who falls under the Dismissal Protection Act) can no longer fulfill the employment contract in the future due to illness. The termination is effective if the employee is permanently unable to work and the termination of the employment relationship is socially justified. However, employers may only resort to termination for personal reasons as a “last resort”. In most cases, a person-related termination is pronounced due to a long illness.

An employer is not allowed to give notice simply because you are ill. A personal termination is only permissible if an illness leads to an unreasonable financial burden for the employer. This can be the case if an employee is unable to work for a long period of time (permanent illness) or has regularly suffered from short-term illnesses in the past three years. According to case law, three conditions must be met for a personal termination due to illness. First, there must be a negative prognosis. This means that the state of health of the employee cannot promise any improvement, i.e. he will continue to be on sick leave for a longer period of time after the medical diagnosis. As a rule of thumb, the employer can terminate the contract if there is no positive forecast for the next 24 months.

Disruptions to work processes or “economic burden”

It is also necessary that absenteeism affects the operational processes of the employer. This is the case, for example, when colleagues are overburdened. However, a mere “economic burden” on the employer is sufficient. Frequent brief illnesses are usually associated with continued payment of wages, because the health insurance company only steps in with the sickness benefit after six weeks. For employers, this absenteeism can be a significant financial burden. If an employee is absent for a total of more than six weeks per calendar year due to frequent brief illnesses, termination may be justified.

Finally, the employer must carry out a balancing of interests. The employer may only give notice if his interests in the termination of the employment relationship outweigh the interests of the employee in continuing it. In favor of the employee, the length of service, age and a need for social protection due to illness, old age or accident must be weighed. Only when the consideration leads to the fact that the employer can no longer reasonably be expected to bear the considerable burden caused by the illness can he/she effectively terminate the contract.

Is a warning required before dismissal due to illness?

Not really – because in the case of a personal termination, the employee is not accused of “manageable” misconduct. As a rule, the employee cannot do anything about an illness. Thus, according to the case law, a prior warning is unnecessary.

Sick during the probationary period – what applies?

Incidentally, something else applies during the probationary period. Less strict dismissal rules apply here, since the statutory protection against dismissal only applies after the probationary period. During this period, termination due to illness is always possible with a notice period of 14 days.

What can you do if you are dismissed due to illness?

If you have received a notice of termination for personal reasons, you should discuss how to proceed with a lawyer who specializes in employment law (information on this can be found here in our guide to termination) if the dismissal is “unfair”. In any case, you should act quickly, because within three weeks of receipt of the notice of termination it must be clarified whether an action for protection against unfair dismissal makes sense. It is important that an expert in labor law carefully examines whether the dismissal due to illness is effective. Even if an employee comes to the conclusion that he has no interest in continuing to work in the company after the termination, the invalidity of the termination will in any case affect the amount of a severance payment. You can do a rough check of the range of a severance payment here:

* A note about our wording. We do not always “gender” – E.g. when we are talking about employees. But we are trying to keep things simple. German labor law is complex enough. For the sake of  clarity and legibility in our texts, we have therefore decided to omit most gender formulations.

You can find more information about what to look out for here: