Kündigungsschutz: When Does Unfair Dismissal Protection Actually Apply?

Germany's reputation for strong employee protection is well earned, but it's also more conditional than people often assume. The Kündigungsschutzgesetz (KSchG, Dismissal Protection Act) only applies once two conditions are both met: you've worked at the company for at least six months, and the company employs more than ten people.

That second condition matters more than most newcomers realize — roughly 80% of German businesses are technically small enough to fall outside KSchG entirely. If you work at a company with ten or fewer employees, your employer doesn't need a legally recognized reason to end your contract; ordinary notice is generally sufficient, though dismissals still can't be discriminatory or violate public policy even in exempt small businesses.

Counting employees isn't a simple headcount either: part-time staff count proportionally rather than as full people for threshold purposes — someone working up to 20 hours a week counts as 0.5, up to 30 hours as 0.75, and anyone above 30 hours as a full 1.0. Trainees don't count toward the threshold at all. A company that looks like it has eleven employees on paper might legally sit under the ten-employee line once you do this math.

Once KSchG does apply, your employer needs a legally recognized reason to dismiss you, falling into one of three categories: personal reasons (something about your capability or fitness for the role, unrelated to fault), behavioral reasons (misconduct — usually requiring a prior warning first), or operational reasons (genuine redundancy or restructuring, which typically requires a fair social selection process among comparable employees).

If you believe you've been dismissed without a valid reason once KSchG applies to you, the window to act is short: a Kündigungsschutzklage (unfair dismissal claim) generally has to be filed within three weeks of receiving your termination notice, at the Arbeitsgericht (labor court). Missing that deadline generally means losing the right to challenge the dismissal at all, regardless of how strong your case might otherwise have been.

None of this affects your Probezeit — during the standard up-to-six-month probationary period, KSchG generally hasn't kicked in yet regardless of company size, which is exactly why Probezeit dismissals are so much easier for employers to carry out than dismissals afterward.