On 9th December 2016 The Federal Labour Court (Germany) deemed a regulation from a redundancy scheme of Cassidian Communications GmbH, according to which employees leaving the company do not get compensation if they can draw pension benefits immediately after the notice period expires, to be permissible.

The Federal Labour Court has thus quashed the verdict of the State Labour Court of Hamm, which awarded a payment to the employee. It revealed that industrial parties may take employees’ eligibility for an early statutory retirement pension into account when excluding individuals from redundancy scheme benefits. This is judged not to contravene the principle of equal treatment under industrial relations law or the ban on age discrimination under European Union law; even complete exclusion from compensation benefits is judged permissible.

In the case in question, the plaintiff, who was born in 1947, was thus rightfully paid no compensation. The Federal Labour Court rejected the payment claimed by the plaintiff amounting to EUR 290,635.10 in full.

“Had the Federal Labour Court come to a different decision, a multitude of redundancy schemes already completed that exclude the payment of compensation in the event of immediately drawing a pension would be legally flawed, and the companies concerned would have been threatened with high belated claims from former employees,” explains Dr Mathias Kühnreich, partner and lawyer at Buse Heberer Fromm in Düsseldorf.

Cassidian Communications GmbH is part of Airbus Defence and Space, a division of the Airbus Group, which was formed in 2014 following the merger of the business activities of Cassidian, Astrium and Airbus Military.