When they help – and when they don’t

Insurance is becoming interesting for more and more people, which is more of a shadowy existence in normal economic times. Legal protection insurance for labor law is in high demand in the times of Corona. Inquiries have quadrupled since January, according to the comparison portal Check24.

The answers to the most important questions on the complex subject areas of legal protection, labor law and dismissal at a glance:

What is the purpose of legal protection insurance?
Every year, over three million cases are heard before a German court in the first instance. Legal protection insurance helps to keep the costs for those affected within limits. There is generally legal protection in the four areas of transport, private, work and housing. Although legal protection is not a compulsory insurance, every second household in Germany has a policy.

Is professional legal protection automatically included in this package?
No, all areas can be closed individually. The modular principle applies. Anyone who is now threatened with termination must therefore ensure that the area of ​​labor or occupational legal protection is included. Then the insurance fundamentally covers legal and court costs.

On the legal side, however, only the costs under the Lawyers’ Remuneration Act (RVG) are covered. It is a kind of minimum wage for lawyers. Legal experts ask for more and usually charge an hourly fee. The plaintiff would then have to pay the difference to the RVG rate himself.

New contracts with a waiting period

What deadlines must be paid attention to?
As with many other insurances, the following applies: first, then benefit. If you are already threatened with a legal dispute, the conclusion of the contract is of no use in this case. Most insurers even agree on a waiting period of two to three months after the conclusion before the first legal dispute. With existing policies, there is often a special right of the insurer to terminate if a customer is involved in too many procedures. The rule of thumb here is two cases in twelve months.

What is the cost of legal expenses insurance?
Policies with all four building blocks – private, transport, work and living – are available for 200 to 300 euros a year. However, this only if the customer has never used the insurance for years. Otherwise, the costs can rise quickly. Usually a deductible of 250 euros applies in the event of damage.

As with car insurance, the premium also depends on where you live. Where there is much complaint, the costs are higher. “Legal protection is not generally cheap,” says the Stiftung Warentest, which only tested tariffs for the self-employed again in April. Accordingly, 21 out of 53 tariffs scored “good”.

Which disputes does the legal protection insurance cover?
The topics are multifaceted and are not only about a possible termination, but also about the recognition of occupational diseases or about reduced earning capacity. Overall, however, all of these subject areas can, in extreme cases, put the insured in an existential situation.

What service is there for uninsured people?
Most providers also advise non-customers in an initial consultation. Anyone who has benefited from this may consider taking out insurance for future cases.

Can a current contract be changed?
Yes, because living conditions are also changing. Those who retire no longer need labor protection. Likewise, customers without a car can save themselves the component of legal traffic protection.

No legal requirement

What rights does an employee have if he is threatened with dismissal?
Anyone who receives notice of termination can file a complaint with the labor court within three weeks. Otherwise, the termination is final. Subsequent admission to the lawsuit is possible, for example in the event of illness. The hurdles for this are high.

How should he do this?
In general, there is no legal requirement in the first instance for lawsuits at the labor court. As a service, the court offers the so-called law office, where the lawsuit is filed and brought into shape. The plaintiff’s signature is then important.

What about court costs if the lawsuit is lost?
Legal protection insurance also covers the costs. These are usually not very high at the labor court, since witnesses are often not interviewed and only postage costs are incurred. Unlike in other areas in court, in the case of a lost lawsuit, at least in the first instance, the costs of the other side do not have to be borne. In every further instance, however, it does. “That is why many workers file lawsuits in the first instance even if the lawsuit seems hopeless,” said Philipp Byers of the British law firm Watson, Farley & Williams. The experienced Munich employment lawyer usually represents the company side up to large corporations.

What is the difference between a termination agreement and a termination?
Ordinary termination is a one-sided approach by the employer. The employee can defend himself against this by means of a dismissal protection suit. This is the rule in most cases. A termination agreement, on the other hand, is an amicable legal transaction that ends without a labor court argument. A cut-off date is set, including things like the use of the company car up to that point or the right to a bonus. “A good termination agreement is the one that settles everything,” said Philipp Byers.

How does termination without notice differ from ordinary termination?
In the event of ordinary termination, the contractually agreed notice period is observed. Termination without notice is usually the result of a gross loss of trust between the employer and the employee. An example of this is the reach into the till. In the event of termination without notice, the employee must leave immediately and no longer receive any money.

Rights in the event of termination

What rights does he have through long service, children, the living situation, but also through membership in a union?
Union members may not be favored or discriminated against in the event of a wave of dismissals. However, you are entitled to legal support from the union.

“Social criteria such as length of service, age, dependent children or severe disability play a very important role in job-related layoffs,” says Byers. In general, those who are least in need of social protection must go with the same suitability and hierarchical level. A point system is often used.

What is possible with severance payments and how is this calculated?
In purely legal terms, no severance payment has to be paid on termination. In practice, however, it is usually the case that an employer is no longer interested in continuing the employment relationship. In order to avoid the time involved in a legal dispute, in most cases a settlement is concluded that includes a settlement.

The severance payment does not automatically belong to a termination agreement either. In practice, however, no employee should agree to a termination without severance pay. “The amount of the severance payment depends, among other things, on the external circumstances, the chances of success of an effective termination and the economic potential of the company, but also on the negotiation skills of both sides,” said Byers. As a rule of thumb for the amount, the amount of the monthly salary times the years of service is times the factor 0.5.

What are the special features?
The term “annoyance severance payment” is used by lawyers to describe a pragmatic approach on the part of the employer, which provides a particularly annoying employee with a particularly good severance payment offer in order to terminate the employment relationship without further disputes. Employers often offer a so-called “sprinter bonus” when there is a major need to cut staff and they want to avoid a large number of lawsuits.

Such offers are generally financially attractive and have a limited term. The employee should decide so quickly to sign a termination agreement, according to the intuition of the employer. “But often those who don’t want to work there anymore and who would not be particularly hard hit financially then report,” observes Philipp Byers. At management level, such offers are used to quietly and silently part ways without a large audience.

More: How consumers can reduce the cost of insurance policies in corona times.

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