Germany's Federal Labor Court Rules On Probationary Periods In Fixed-Term Contracts

Germany's Federal Labor Court (Bundesarbeitsgericht (BAG)) recently ruled that there are no rigid limits on the proportionality of the duration of a probationary period for fixed-term employment contracts, and that the limit depends on the individual case (judgment of October 30, 2025 – 2 AZR 160/24). The BAG's opinion answers a question that local and regional courts have been wrestling with since the introduction of Section 15 (3) of the German Part-Time and Fixed-Term Employment Act (TzBfG).

Quick Hits

• On October 30, 2025, the Federal Labor Court of Germany ruled that probationary periods in fixed-term contracts must be proportionate to the duration and type of work, with no rigid limits.
• The Federal Labor Court upheld a four-month probationary period for a one-year fixed-term contract, considering it is proportionate due to a sixteen-week training plan.
• The Federal Labor Court clarified that even if a probationary period is deemed inadmissible, the six-month waiting period after which the termination restrictions under the German Termination Protection Act which remains unaffected.

Background

The employee was hired as an "Advisor I, Customer Service," on a fixed-term contract for one year. The parties had agreed on a probationary period of four months in the employment contract, during which the employment relationship could be terminated with two weeks' notice. The employer terminated the employment relationship during the probationary period in accordance with the two-week notice period. The employer had drawn up a detailed training plan with three different phases lasting a total of sixteen weeks.

The employee filed an action for unfair dismissal before the Berlin Labor Court. She argued that the probationary period was disproportionately long, which is why she could only be dismissed in compliance with the statutory notice period under Section 622 (1) of the German Civil Code (BGB) (i.e., four weeks to the fifteenth or end of a month). In any case, the termination required social justification because the waiting period under Section 1 (1) of the German Termination Protection Act (KSchG) could only be as long as a permissible agreed proportionate probationary period, which in this case was to be set at three months.

The Berlin Labor Court considered the agreed probationary period to be disproportionate and upheld the claim in this respect; otherwise, the claim was dismissed. The Berlin-Brandenburg Regional Labor Court (LAG) also considered the four-month probationary period to be disproportionate, as it exceeded the "standard value" of 25 percent of the fixed-term period. The BAG considered the termination to be valid in compliance with the two weeks' notice period during the probationary period.

Decision of the BAG

The employee's appeal, which claimed that the termination was completely invalid, was unsuccessful. The employer's cross-appeal was successful, and the BAG dismissed the action in its entirety.

In the opinion of the BAG, there is no rigid rule of 25 percent of the fixed-term period for the duration of the probationary period in fixed-term employment relationships. Rather, the proportionality of the probationary period depends on an overall assessment of the circumstances of the individual case, which must take into account, in particular, the nature of the work and the expected duration of the fixed term. The BAG considered a probationary period of four months to be proportionate in view of the sixteen-week training plan drawn up by the employer.

In addition, the BAG clarified that even if a disproportionately long and therefore inadmissible probationary period is agreed, the six-month waiting period under Section 1 (1) of the German Termination Protection Act (KSchG) remains unaffected, even in the case of fixed-term employment contracts. This means that a fixed-term employment relationship can be terminated within the first six months without social justification within the meaning of the KSchG, even if the probationary period is inadmissible.

Outlook

The BAG's decision comes as no surprise, even if practitioners would prefer fixed rules for the sake of legal certainty. However, such rules are not laid down in the law, so that, as provided for in the law, it depends on the individual case, in particular the duration of the fixed term and the type of work performed. As an initial guide, the 25 percent mark can certainly continue to be used, but it must be adjusted downwards (e.g., for very simple activities that require no or only a short training period) or upwards (more complex activities, longer training periods) depending on the circumstances of the individual case. As a result, the risk for employers is also manageable, as no reason for termination is required before the expiration of the six-month waiting period within the meaning of Section 1 (1) KSchG.

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