Federal Labour Court:Works council election does not change fixed term

In its ruling of 18 June 2025 (7 AZR 50/24), the Federal Labour Court (BAG) confirmed its previous case law on fixed-term employment contracts for works council members, according to which the election of an employee with a fixed-term contract to the works council does not render the fixed term invalid.

Facts of the case

At the beginning of 2021, the plaintiff signed an employment contract with a logistics company that was initially limited to one year and was later extended by another year until February 2023. Unlike sixteen of his colleagues, whose contracts expired at the same time, the plaintiff, who was elected to the works council in mid-2022, did not receive an offer to conclude a permanent follow-up contract. He subsequently filed a lawsuit, arguing that the decision not to offer him a permanent contract was due to his membership in the works council and his candidacy on the trade union list. As a result, he claimed that the fixed-term nature of his contract should be deemed invalid.

Decision of the Federal Labour Court

The Federal Labour Court disagreed and upheld the decision of the lower court (Lower Saxony Regional Labour Court), which did not consider the plaintiff's submission to be sufficient to establish discrimination on the basis of works council membership. The Regional Labour Court had arrived at the conclusion, following a correct assessment of the facts, that the employer had not refused to conclude a permanent follow-up contract with the employee because of his works council activities.

The ruling is to be welcomed and is in line with the decisions of the Federal Labour Court (BAG) of 5 December 2012 (7 AZR 698/11) and 25 June 2014 (7 AZR 847/12). According to the general rules of procedural law, the burden of proof for discrimination on the grounds of works council membership lies with the employee. The argument that an election of a fixed-term employee to the works council automatically results in a permanent extension of the employment contract is unconvincing because Section 78 sentence 2 of the Works Constitution Act (Betriebsverfassungsgesetz – BetrVG) only prohibits discrimination against employees on the grounds of their membership of the works council. However, this is not the case if the employer refrains from concluding a permanent follow-up contract for legitimate, unrelated reasons.