Theoretical and Practical Aspects Regarding the Cancellation of a Job Position

What does the cancellation of a job position represent and what impact does it have on the employee that occupies such job position?

The cancellation of a position represents an internal restructuring measure of the employer, determined by various circumstances (e.g., economic, technological, organizational, etc.) existing within the company at a given time. Its purpose is to streamline the employer’s activities, aiming for a more effective utilization of human and financial resources.

The cancellation by the employer of a job position must be justified by objective criteria and, as explicitly stated by Article 65(1) of the Labor Code, must not be related to the employee occupying the job position being canceled.

Regarding the impact that the cancellation of a job position has on the employee occupying it, the same Article 65(1) of the Labor Code stipulates that the cancellation of a job position may lead to the dismissal of the employee for reasons unrelated to its person/behavior. Of course, the employer also has the option to offer the employee whose job position is being canceled another job position within its structure, but such measure is not mandatory per to the Labor Code.

What conditions must be met for the legal cancellation of a job position?

The conditions to be met for the legal cancellation of a job position are briefly provided by Article 65(2) of the Labor Code. These conditions involve the effectiveness of the job position cancellation measure and the existence of a real and serious cause underlying the decision.

Effectiveness of the job position cancellation

As stated in both legal literature and court practice, the effectiveness of cancelling a job position implies the removal of such job position from the employer’s structure. In practical terms, this measure means removing the job position from the employer’s organizational chart and, if applicable, from the staff list.

The cancellation of the job position becomes effective, according to court practice, by ceasing the particular daily activities performed by the occupant of that job position, either through the permanent cease of their performance within the overall operations carried out in the company, or by reallocating additional service duties to an employee who primarily performs another category of activities.

The removal of the job position from the employer’s organizational chart is a fundamental and essential evidentiary element of the legal cancellation of the job position. Any other evidence regarding the effectiveness of cancelling the job position serves only a complementary role. In practice, the court may request the submission of the organizational chart both before and after the cancellation of the job position in order for the employer to prove the effectiveness of the measure.

The real and serious nature of the job position cancellation measure

The Labor Code does not specify, even by way of example, what real and serious causes can lead to the cancellation of a job position. As a result, it has been left to the legal literature and court practice to determine concretely which causes are real and serious and can justify the cancellation.

In this regard, the legal literature and court practice has indicated that a cause is real when it presents an objective character, meaning that it truly exists and does not disguise reality. Furthermore, a cause is considered serious when the measure taken by the employer does not disguise reality and is aimed exclusively at improving the employer’s activities.

Court practice is extremely rich in terms of the real and serious nature of job position cancellations. For example, the following situations have been established by the court practice as real and serious causes that have led to the cancellation of job positions:

  • Adoption of internal reorganization measures by the employer due to various objective causes (e.g., economic difficulties, loss of contracts, loss of authorizations, loss of suppliers, etc.).
  • Outsourcing of services to an external provider.
  • Consolidation of two positions.
  • Decrease in the employer’s turnover.

The same court practice has ruled that the following are not real and serious reasons for cancelling job positions:

  • The employer’s economic difficulties are not real considering its behavior in the market (e.g., hiring campaigns for new employees).
  • The employer based the measure on hypothetical situations (predictions) rather than concrete factual elements.
  • The job position was terminated just two months after hiring another person for the same job position.

What aspects should be considered when dismissing an employee whose job position has been cancelled?

 The most important aspect for the employer to consider when dismissing an employee whose job position has been cancelled is that the elimination of the job position cannot constitute a measure for dismissing the employee for personal/subjective reasons, but a necessary measure to improve efficiency that may lead to the employee’s dismissal for objective reasons, independent of its personal qualities/behavior.

Additionally, in order to justify the dismissal, the employer must have previously cancelled the job position.

Another extremely important aspect is for the employer to comply with all procedural stages of the dismissal resulting from cancelling the job position, as well as with the mandatory content of the dismissal decision.

Lastly, the employer should also consider the number of employees being dismissed due to cancelling job positions to determine if the number of employees being dismissed risks triggering the specific procedures for collective dismissals.

To prove good faith in the event of a contested dismissal decision, although not required by labor law, the employer could also offer the employee an alternative job position.

Additionally, it is recommended that in cases where the employer decides to individually dismiss a certain employee even though there are several employees occupying similar job positions according to the organizational chart, the employer should provide a minimum justification regarding its decision in order to eliminate the appearance of subjectivity when choosing the employee that will be dismissed.

What happens to the responsibilities of the person who has been dismissed due to the cancellation of the job position?

To the extent that these responsibilities need to be continued, they can be taken over by other employees or outsourced. Establishing a new job position in order to hire someone who will assume the responsibilities of the person who was dismissed due to the employer cancelling the job position is excluded.

What does the court analyze or should analyze in resolving a case involving job position cancellation?

As emphasized in legal literature on various occasions, the measure of cancelling a job position followed by employee dismissal is a decision entirely within the employer’s discretion. However, the court responsible for resolving a case regarding the dismissal of an employee due to such a cancellation should strictly analyze the validity aspects of the measure.

Nevertheless, the employer’s discretion should be objective and not subjective, and the elements that objectify this decision (e.g., various documents underlying the decision) will play an important role in the court when administering proof.

For more details on labor law matters, we invite you to contact the author, Andrei Mureșan, Counsel, act legal Romania, at the following email address:

act legal Germany advises owners on the sale of Axel Semrau Group to Australian Trajan Scientific Group

act legal Germany advised the owners on the sale of all shares in the companies of the Axel Semrau Group to the Trajan Scientific and Medical Group (“Trajan“), a listed company from Australia.

Axel Semrau has been active in the sales and support of special solutions for sample preparation and chromatography, chemical synthesis and application-optimized workstations for more than 35 years and develops its own hardware and software solutions in order to offer unique and above-average automation solutions can.

Trajan, headquartered in Melbourne, currently operates in Australia, the USA and Malaysia and manufactures devices for the analysis of biological, food and environmental samples. The Axel Semrau Group is, among other things, the owner and developer of the intelligent sequencing software platform CHRONOS, on which Trajan’s automated work processes are based. Against this background, Trajan, together with the previous management team, is planning a further growth strategy to simplify and automate complex analytical work processes.


act legal – with more than 300 professionals throughout Central Europe – act legal offers sophisticated national and international legal advice – the attractive alternative to major international law firms.

act legal Germany maintains a long-term client relationship with Axel Semrau and advised the shareholders on all aspects of the transaction.

Consultants Axel Semrau

act legal Germany: Dr. Fabian Brocke, LL.M. (M&A, lead); Dr. Nina Honstetter (Corporate, Employment); Anna Gatzweiler (IP/IT)

Moog Partnerschaftsgesellschaft mbB: Marc Sälzer (Tax)

Growth Strategy: act legal Germany advises innovative FinTech company fintus on Europe-wide expansion

Last Friday, AnaCap Financial Partners, London (“AnaCap“) – one of Europe’s leading private equity investors in the technology and financial services sector – signed a majority investment agreement with fintus GmbH (“fintus“).

fintus is the leading low-code banking platform in Germany. Using low-code, banks react to changes within days instead of being dependent on long software development cycles. Since its foundation in 2017, fintus has successfully positioned itself as a provider with its Software-as-a-Service (SaaS) platform “fintus Suite” enabling the automation and transformation of banks and financial service providers. Founded in the heart of the financial metropolis Frankfurt am Main and without the support of financial investors, fintus was able to attract well-known customers early on. Today, a double-digit number of TIER 1-3 banks in Germany are already among the company’s customers.

AnaCap, based in London, has a long track record of successfully investing in FinTech companies in the DACH region. The investment in fintus was preceded, among other things, by the acquisition of WebID Solutions  in September of this year, which, among other things, is a technology partner of fintus.

The fintus management team led by founder Benjamin Hermanns will consistently drive forward its internationalization and expand its service portfolio with the strong financial partner AnaCap.

The implementation of the transaction is still subject to customary closing conditions.

Background info

act legal: with more than 300 professionals throughout Central Europe, act legal represents an attractive alternative to large international law firms by providing sophisticated national and international legal advice.

act legal Germany has been advising fintus since its foundation and has comprehensively advised fintus on all legal aspects regarding this complex transaction.

Advisors fintus

act legal Germany: Marcus Columbu (Finance, Lead), Dr. Fabian Brocke, LL.M., (Corporate/M&A, Lead); Dr. Thomas Block, MBA (Labor Law); Sarah Landsberg (Corporate/M&A).

IEG – Investment Banking Group: Mirko Heide, Patrick Schüler (Investment)

Berater AnaCap: Proskauer Rose und Norton Rose Fulbright (Law), GCA Altium (corporate finance)

“Status quo vadis”: Smart automation in Human Resources

When automating HR processes, it is important to make them legally compliant in order to benefit from technological progress in the long term.

“The imagination knows no bounds.” This sentence is especially true when it comes to the digitalisation of process steps in HR departments. Companies such as Workday, Service Now, SAP and Oracle advertise a “digital workflow”.
workflow”. Among other things, they offer harmonised, group-wide digital application platforms. The systems scan applicant portals fully automatically, contact potential applicants if they meet predefined criteria, create individualised job offers and communicate with identified candidates. criteria, create individualised job offers and communicate with identified candidates, and arrange appointments.

Robotic Process Automation

Complementary “offer to contract” software helps to automatically create and send contracts, confirm the conclusion of a contract, inform the works council and send the on-boarding documents.
The latter falls under the term Robotic Process Automation. Repetitive processes in Human Resources (HR), including payroll, travel and expense management, works council information, can be automated in this way.
The trick is to identify rule-based processes that the software handles virtually for an employee. This can be achieved if the same process steps always occur (open files, copy, enter into Excel or another programme). Another area of application is people analytics. By linking individual personnel data, the Watson Career Coach, for example, independently suggests suitable further training and development steps. Furthermore, general personnel data can be linked in order to automatically take into account the number of retirements, the average natural fluctuation and other key figures in personnel planning.

The use of artificial intelligence is most exciting here. Chatbots are particularly well known for their ability to selection of new employees and for inclusion in talent management programmes. They For example, they evaluate pitch, speaking rate and vocabulary during short telephone conversations that the candidates have “with the robot”, speech rate, vocabulary and analyse language skills and, “if desired”, personality. Thus Fraport AG, for example, identifies talent with the help of this technology.

These developments are inspiring, especially as further promises from the IT industry are tempting business leaders. simpler and faster availability of data, acceleration of processes, reduction of error-proneness, savings in personnel costs error-proneness, savings in personnel costs, increased attractiveness of the company on the labour market. labour market. So what’s the catch?

The introduction of digital systems is complex, no one disputes that. But it is feasible if sufficient care is taken in the preparation and processing of the necessary data. Legally, the hurdles are already higher. The principle of data protection law, according to which automated data processing may not be the sole basis for personnel decisions, can still be fulfilled. However, many state data protection commissioners consider many IT tools for automated applicant selection to be ineffective because they are “not necessary” and proportionate. necessary” and proportionate.

Weighing of interests necessary

In the author’s opinion, such sweeping statements go too far. Based on these opinions, companies are are well advised to prepare the use of algorithms & co. carefully from a legal point of view. Required are a transparent and prior description and documentation of the individual process steps. It must be determined what data is collected, processed and stored for what purpose.

The data must be suitable to achieve the previously defined purposes of the data collection and should, as best as possible, be related to the activity (potentially) performed by the employee. This serves to justify the collection of the data. It is also recommended that a company carries out a balancing of interests and that this is done and document this, together with the other legally required steps, in text form before introducing the software. in order to be able to prove the legality without delay, if necessary.

Finally, the database must be non-discriminatory; otherwise, past infringements will continue into the future. This is especially risky when relying on large amounts of data.

Consents from applicants and employees to use certain digital systems can help, as the General Data Protection Regulation explicitly allows them. They should inform comprehensively and transparently and – if possible – be in writing. Text form is only permitted in exceptional cases. Furthermore, the data subject must be data subject must be informed of his or her right of revocation for the future.

“Smart labour contracts”

The introduction of “intelligent employment contracts” is no longer about a paper employment contract, which an HR employee customises, prints out, has signed and sends. Rather, it is about the virtual virtual representation of a contract in a programme, which is automatically sent to the recipient. This is particularly interesting for corporate groups if the introduction of “intelligent employment contracts” can be used to application processes and employment contract templates, remove superfluous clauses and flexibly respond to individual and to be able to react flexibly to individual adjustments with conditional clauses – as far as reasonably possible in each case.

Barely any technical limits

It should not be forgotten that the law provides for the written form in certain cases, for example in the case of fixed-term contracts and post-contractual non-competition agreements. fixed-term contracts and post-contractual non-competition clauses. A digital signature stored in the system signature stored in the system is not sufficient.

There are hardly any technical limits to the imagination when it comes to automating HR processes. However, it is important to capture the imagination mentioned at the beginning of this article in order to make the processes legally compliant and to be able to profit from technical progress in the long term. Otherwise, there is the threat of unwelcome mail from a supervisory authority.

Source: Börsen-Zeitung Nr. 197, Wednesday 13 October 2021

zetcom, an HQIB portfolio company, acquires majority stake in Fluxguide

zetcom Informatikdienstleistungs AG (“zetcom”), a Harald Quandt Industriebeteiligungen GmbH (“HQIB”) portfolio company, has acquired a majority stake in Fluxguide Ausstellungssysteme GmbH (“Fluxguide”). The two founders and managing directors of Fluxguide, André and Kasra Seirafi, will remain co-shareholders and continue to manage Fluxguide’s day-to-day operations, as well as work closely with zetcom’s management team to advance the digitalization of museums and cultural institutions worldwide. The parties have agreed not to disclose further details of the transaction.

The combination of zetcom (collections management system) and Fluxguide (digital experiences, apps, media guides) combines competencies in the field of collections documentation and collections management with the digital interface to the visitor, an essential step in the digitalization of museums. The COVID-19 pandemic, among other things, has further accelerated the shift from traditional museum visits to a comprehensive digital experience.
“Digital interactions and the opportunities it offers for museums to create unique customer experiences will become increasingly important in the future. Moreover, museums will be able to significantly multiply their reach through digital content. We are pleased to have found a partner in Fluxguide with whom we can offer our more than 1,000 international customers state-of-the-art solutions in the field of digital experiences. One-stop, integrated software offerings can significantly reduce the complexity and time investment for museums,” says Marcel Zemp, founder and CEO of zetcom.

“We’re excited about working with zetcom. Together, we can offer an unparalleled range of digital solutions: from internal collections management to experience platforms on all digital channels. On the one hand, we offer individualized high-end solutions for specific customer requirements; and on the other hand, also standardized solutions for smaller and medium-sized cultural institutions will be available in the future. These attractively priced alternatives will enable all customers in the cultural sector to deepen and professionalize their digitalization journey,” say André and Kasra Seirafi, founders and managing directors of Fluxguide.

The long-term goal is to build a globally leading group of complementary software products for the cultural sector, inter alia through targeted acquisitions. Besides the two companies’ core markets in Europe, there will be an increased focus on further internationalizing the group, especially in NorthAmerica. The world’s largest museum market contains considerable growth potential for digital solutions, of which zetcom is already benefiting today with a subsidiary in the U.S.

About zetcom

zetcom develops internationally leading software solutions and services for museums, collections, and corporate archives as well as solutions for organizational management (foundations and associations) and environmental data management (administration and companies). Over 1,000 customers in more than 30 countries are using its flexible software solutions (SaaS) to develop and maintain cultural heritage, manage daily business or administer environmentally relevant institutions. They are supported by zetcom’s headquarters in Switzerland, by subsidiaries in Germany, the US, Spain, France and worldwide partners. Since 1998 zetcom is a reliable partner for continuous innovation, high-quality products and services and comprehensive know-how. Since 2020 zetcom belongs to the holding company Harald Quandt Industriebeteiligungen GmbH. Further information can be found at

About Fluxguide

Fluxguide develops unique digital visitor experiences in the fields of culture, science, and learning. The company offers consultation, conception, and end-to-end realization of customized solutions that transform exhibitions into creative and lively experiential spaces. Fluxguide’s many years of experience and its interdisciplinary team guarantee award-winning innovations, didactic excellence, state-of-the-art technologies, and professional handling. Clients include international museums and cultural institutions as well as research institutions and universities. Fluxguide was founded in 2013 and currently has about 20 employees. Further information can be found at

About Harald Quandt Industriebeteiligungen

Harald Quandt Industriebeteiligungen is the principal investment firm of the family Harald Quandt joined by a small, select number of (industrial) families and partners. HQIB invests in small and medium-sized companies within the German-speaking region, that are leading in established and technologically sophisticated market niches with attractive growth potential. As an industrial holding company, HQIB pursues a long-term, sustainable investment approach and is not subject to any time restrictions or limited investment periods. Further information can be found at

Advisors HQIB

Dr. Sven Tischendorf, MBA, Dr. Alexander Höpfner and Dr. Felix Melzer ensure profitability and refinancing of the international Vossloh-Schwabe Group within the scope of self-administration proceedings

The Vossloh-Schwabe Group enjoys a tradition of more than 100 years as one of the world’s leading manufacturers and distributors of LED systems, lighting control systems and lighting technology components with subsidiaries in Europe, Asia, Africa and Oceania. Until the end of 2019, the Vossloh-Schwabe Group was part of the Panasonic Group and was sold to the private equity investor Fidelium Partners at the beginning of 2020. With a total of more than 1,000 employees, the Vossloh-Schwabe Group generated sales of EUR 160 million in the fiscal year of 2019.

After the creditors have unanimously approved the insolvency plans submitted by the self-administration on May 03, 2021, the self-administration proceedings (protective shield proceedings), pending since May 2020, will be able to be lifted in the near future. In addition to optimizing the entire production and sales organization, the reorganization carried out in the course of self-administration proceedings likewise comprised of partial plant closures and relocations of operating units. By these measures, the long-term profitability of the entire Vossloh-Schwabe Group is ensured and the permanent existence of jobs is safeguarded.

Fidelium Partners continues to support the Vossloh-Schwabe Group as a shareholder and, as part of the capital measure implemented in the insolvency proceedings, has extensively re-funded the Vossloh-Schwabe Group. Thus, the Vossloh-Schwabe Group is not only fully financed but has also regained its full operational capacity and competitiveness.

After the successful completion of self-administration proceedings of Baden-Board, Picard, JMT and Hallhuber in the past six months alone, act legal Germany’s insolvency and restructuring practice can record a further restructuring success with the Vossloh-Schwabe Group within one of Germany’s market-renowned proceedings.

Self-Administration, Consultancy Vossloh-Schwabe Group: act AC Tischendorf: Dr. Sven Tischendorf, MBA (lead, chief representative, CRO), Dr. Alexander Höpfner (lead, chief representative, CIO), Dr. Felix Melzer (process handling), Dr. Fabian Laugwitz, MBA, LL.M. (supplier management), Dr. Stephan Schwilden, MBA (Employment law), Dr. Nina Honstetter (Employment law)

act legal Germany – China Business

As one of the very few European law firms, Dr. Stephan Schwilden, MBA is registered with the Chongqing Judicial Bureau as “Foreign Legal Counsel” of ZHH | Zhonghao Law Firm, one of the leading business law firms in China with offices in Beijing, Chongqing, Shanghai, Chengdu, Guiyang and Hong Kong. Thus, we ensure our European clients in China the same high standard as in our home market, both in terms of advisory style and professional expertise. In addition, we have many years of know-how in advising Chinese companies, investors and law firms in Europe.

act legal Germany advised HQIB on the acquisition of Ergosign-Group

Harald Quandt Industriebeteiligungen GmbH („HQIB“), the principal investment firm of the family Harald Quandt, acquired a majority stake in Ergosign-Group, the market leading digital agency with focus on user experience design in the German-speaking region.

The two founders, Dr. Marcus Plach and Prof. Dr. Dieter Wallach, remain co-shareholders and managing directors of the company. Together with HQIB, which has a long-term and sustainable investment approach, they aim to foster internationalization of Ergosign-Group and expand its service portfolio. 

Both parties have agreed not to disclose further details of the transaction.


HQIB invests in small and medium sized companies in the German speaking region that are leading in established and technologically sophisticated market niches with attractive growth potential.

act legal – with more than 390 corporate and commercial lawyers across central Europe – offers demanding corporate clientele high-level, cross-border, or regional legal advice being the attractive alternative to major international law firms.

act legal Germany advised HQIB comprehensively in all matters of this complex transaction.

Advisors HQIB:

act legal Germany: Dr. Fabian Brocke, LL.M. (Corporate/M&A, lead partner), Dr. Nina Bogenschütz (Employment); Dr. Nina Honstetter (Corporate, Employment); Sarah Landsberg (Corporate/M&A).

Common labour law issues and misconceptions in the state of emergency

If the company’s sales have fallen due to the crisis caused by the coronavirus, can employees’ salaries be reduced or even employed in other jobs?

The employer may not unilaterally reduce the wages of employees or change their jobs. According to the Labour Code, the parties to the employment contract must agree on the employee’s basic salary and position. That is why wages and positions can only be changed by mutual agreement of the parties. Thus, a salary reduction or a change of job can be made by amending the employment contract, which requires the consent of the parties.

If the salary cannot be reduced and the job cannot be changed unilaterally, then how can the employer get rid of the overstaffing situation?

The employment may be terminated by the employer by notice, which is a unilateral act, i.e. it does not require the agreement of the parties. If the parties can agree on the termination of the employment, they may settle the matter of parting ways by mutual agreement. Thus, the rules for termination of employment have not been changed with regard to the coronavirus, employment can still be terminated by mutual agreement or termination if the employee cannot be provided with work.

Could the coronavirus be the reason for the termination?

The employer is required to give the reasons for the termination and the Labour Code requires the reasons for the termination be clearly stated. This requirement is not met if the justification for the termination is merely that “the termination is due to the coronavirus”.

The reason for the termination in this case will be a reason related to the operation of the employer, i.e. the loss of income due to the coronavirus and the resulting redundancies and/or reorganisations. However, these must be apparent from the statement of reasons, which must be clear, real and reasonable.

Of course, in an eventual labour lawsuit, the employer has to prove the fact that the income has decreased and as a result the number of employees has actually been reduced and the work processes have been reorganized. Thus, termination will be unlawful if, after the termination, another employee is hired for the same job instead of the employee who was terminated with reference to redundancies.

If the rules for terminating employment have not changed, what has changed because of the coronavirus? Although the Labour Code has not changed since January 1, 2020, the government has allowed deviations from certain rules of the law for a period lasting until thirtieth day following the end of the state of emergency. Thus, for example, the employer may unilaterally order the employee to work from home and telework, but the government decree also gives the opportunity for the parties of the employment to deviate from the rules of the Labour Code in a separate agreement.

Employers will be able to gefer contributions to their social insurance at reduced penalties

On May 20, 2020, the Czech Senate passed a law allowing employers to defer payments for their social security insurance premiums for the months of May – July 2020 at reduced penalties. The law can be expected to become effective in the coming days.

The purpose of this law is to strengthen the liquidity of employers in the current difficult situation and to provide them with relief regarding their mandatory payments for the social security insurance premiums (hereinafter referred to as the “insurance premiums“). In order for employers to be able to defer payments for their insurance premiums for the above-mentioned months, they must continue to pay insurance premiums on behalf of their employees for the said months.

Please note that deferring payments of insurance premiums does not release employers from the obligation to pay a penalty for not paying the insurance premiums on time. The adopted law only allows for deferral of insurance premiums payments for employers paid for the months of May – July 2020 until October 20, 2020 with a reduction of the late payment penalty by 80%. The amount of the penalty is now 0.01% of the amount owed for each day, instead of the usual 0.05%. Deferment of payments will be assumed automatically, i.e. it will suffice if the employer does not pay its insurance premiums for the month of May 2020 by June 20, 2020 (the procedure will be analogous for the months of June and July 2020). However, if the employer fails to pay the amount due by October 20, 2020, the Social Security Administration will impose regular penalty instead of the more favorable penalty of 0.01%, i.e. a penalty of 0.05% of the amount owed for each day.

Another benefit of this law is undoubtedly the fact that in the case of using the option to defer payments for insurance premiums in accordance with the above, the “debt” incurred will not be considered to equal unpaid insurance premiums for the purpose of confirming the employer’s lack of indebtedness.

Please note that the deferral of insurance premiums payments cannot be used at the same time as the state contribution from the Antivirus program for the wages compensations. A prerequisite for obtaining the contribution from the Antivirus program is the due payment of insurance premiums, both for the employer and on behalf of its employees. Currently, the Antivirus program is valid until the end of May, but its further extension can be expected. Employers will therefore have to choose whether they want to draw contributions from the Antivirus program or use the deferral option for their insurance premiums.

In case of any questions related to the state compensation measures taken in the field of employment which an employer can use in the current difficult situation, please contact attorney-at-law Mgr. Lenka Droscová, our labor law specialist.