What is the definition of change security for an employer?

Re-employment security is a statutory obligation of the employer that is activated in connection with dismissals due to production or financial reasons. It includes what is offered to the employee services and support measures to promote employment. The scope of change security depends on the size of the company and the number of redundancies, and includes information, training, and organization of occupational healthcare.

What is a change of employment security and when does an employer need it?

Change management is a statutory obligation, with regard to the employer in the context of production and economic dismissals. The obligation always arises when an employee is dismissed for economic reasons, but its scope varies according to the size of the company.

Change security differs significantly from ordinary termination and layoff. While termination is the final ending of an employment relationship and layoff is temporary suspension of work, change security focuses on supporting the terminated employee in finding new employment.

The employer's obligations in transition security activate at different stages depending on the size of the company. All employers are obligated to inform employees aged 55 and over about their right to expanded transition security. Larger companies face broader obligations, such as developing an action plan and organizing training.

What does job security mean for an employer in practice?

In practice, change security means several concrete obligations for the employer, which vary depending on the size of the company and the number of terminations. At its smallest, it means a duty to inform, and at its broadest, it involves organizing training and occupational healthcare.

When you dismiss at least ten employees, you must prepare an employment promotion action plan with the personnel. The plan shall set out the schedule, procedures, and operating principles of the change negotiations for promoting the job search and training of the employees.

If your company regularly employs at least 30 employees, your obligations expand significantly. You must offer laid-off employees who have been with you for at least five years the opportunity to participate in employment promotion coaching or training. Additionally, you will provide them with occupational healthcare for six months after the termination of their employment.

Costs are primarily incurred from organizing training and covering occupational healthcare. If you do not comply with the training obligation, you will have to pay the employee an amount equivalent to the value of the training. Fortunately, you can receive compensation for occupational healthcare according to the Sickness Insurance Act.

The change management process also affects the company's HR processes. You must notify the labor authority of the information of employees to be laid off and ensure that HR processes support meeting statutory obligations for the entire duration of the transitional support.

How does change management differ from termination and furlough?

Change security, termination, and layoff are three different means of staff reduction., which have clear legal differences. Termination definitively ends the employment relationship, layoff temporarily suspends it, and transition security is a package of support services in connection with termination.

Termination for production and financial reasons always requires the provision of transition security. In a layoff, the employee retains their job, but work and pay are suspended for a fixed term or indefinitely. The laid-off employee has the right to return to work when the situation improves.

The practical implications for the employer vary significantly. Layoffs are a more flexible option in short-term financial difficulties, as they do not require change security obligations. Termination, on the other hand, is a final solution that activates change security obligations.

From the employee's perspective, change security offers concrete help in finding new employment. It can include change security payments, training opportunities, and a re-employment leave for those aged 55 and over. These benefits do not apply to furloughed employees.

The choice between the right method depends on the permanence of the situation and the company's financial outlook. If the difficulties are temporary, temporary layoffs are often the most appropriate solution. In the case of permanent changes, termination with transition security better serves the interests of both the company and the employee.

Implementing change security requires careful planning and knowledge of legal obligations. If you need assistance with the change security process or want to ensure your obligations are met properly, contact An HR expert who will help you navigate through the change situation.