Employer seriously culpable for breaking a verbal contract-renewal promise, but secret recording reduces compensation

An employee secretly recorded the conversation containing the promise. An employer who broke his word, and an employee who breached trust, resulted in a reduced fair compensation of EUR 2,174.10 gross.

Facts

The employee started working for the employer on 1 January 2024 under a fixed-term employment contract of twelve months. If he performed well, the contract would be converted into an indefinite-term contract. In September 2024, the employer and employee had a conversation about his progress, which the employee secretly recorded. Although the employer expressed doubts about the employee’s performance, the employer nevertheless spoke positively about the possibility of continuing the employment. One month later, the employer informed the employee that his contract would not be renewed, meaning the employment would end on 1 January 2025. The employee argued that the employer had promised his contract would be renewed, referring to the transcript of the progress conversation.

The employee took the position that the real reason for not renewing the employment contract was that he was considered too expensive, or too old, compared to a younger and cheaper colleague. The employee requested fair compensation for seriously culpable conduct by the employer.

Ruling of the subdistrict court

The subdistrict court reduced the claimed fair compensation. Although the employee secretly recorded the progress conversation, the subdistrict court considered the content of that conversation decisive. The subdistrict court ruled that the employee could reasonably interpret the crucial sentence, “I am positive about renewal, you know”, as a promise that his employment would, in any case, continue for some time. The employer argued the statements needed to be seen in context and were dependent on the employee’s performance. The subdistrict court disagreed and ruled that, had the employer wanted to keep the possibility of non-renewal open, it should not have left any room for doubt with the employee.

According to the subdistrict court, the employer’s failure to honour its verbal promise qualified as seriously culpable conduct. This seriously culpable conduct entitled the employee to fair compensation. However, the employee’s secret recording of the progress conversation, and using it as leverage, did not, in the subdistrict court’s view, reflect the proper conduct the employee should have shown towards the employer. The subdistrict court ruled that the employee had thereby not behaved as a good employee, and reduced the fair compensation accordingly.

Conclusion

It must be taken into account that many conversations are secretly recorded nowadays. Such recordings count as valid evidence.

Making a verbal promise to renew a fixed-term employment contract, and then failing to honour it, can amount to seriously culpable conduct on the employer’s part. On the other hand, secretly recording progress conversations and using them as leverage can qualify as a failure to act as a good employee. The significance of this ruling is that both parties must conduct themselves as a good employer and good employee, and that careless conduct by one party will not automatically lead to full compensation if the other party has also fallen short of its obligations.

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