Recent decision of the Berlin Labour Court: electronic signature regularly insufficient for fixed-term employment contracts

Pursuant to Section 14(4) of the German Act on part-time work and fixed-term employment contracts (Gesetz über Teilzeitarbeit und befristete Arbeitsverträge, TzBfG) the effective conclusion of a fixed-term employment contract requires the written form. The written form can be replaced by the electronic form (Section 126(1) and (3) of the German Civil Code (Bürgerliches Gesetzbuch, BGB). For this purpose, both parties must be named in the contract and a qualified electronic signature must be attached to it (Section 126a BGB).

In the present case, the employee and the employer did not sign a fixed-term employment contract in paper form and by hand. Rather, the parties used the e-Sign tool to generate an electronic signature to conclude the contract. The Labour Court ruled that the form of signature used did not satisfy the requirement of written form. Even if one were to assume that a qualified electronic signature within the meaning of Section 126a BGB is sufficient for the effective agreement of a fixed term, the signature in the case under review did not meet these requirements.

In its decision, Berlin Labour Court states that a qualified electronic signature requires certification of the signature creation device in accordance with EU requirements (Article 30 of Regulation (EU) No 910/2014 of 23 July 2014 on electronic identification and trust services for electronic transactions in the internal market). In Germany, the Federal Network Agency is responsible for such certification in accordance with Section 17 of the German Trust Services Act (Vertrauensdienstegesetz, VDG). However, the provider e-Sign used in the present case does not have a corresponding certification, so that the tool e-Sign used does not constitute a certified qualified electronic signature creation device. The agreement of the fixed term was therefore invalid for lack of compliance with the written form or the electronic form replacing it (Section 126a BGB). In such a case, the employment contract is deemed to have been concluded for an indefinite period of time pursuant to Section 16 TzBfG.

The decision is not yet legally binding; the right of appeal to the Berlin-Brandenburg Higher Labour Court has been granted.

In times of digital transformation of the working world, the decision of the Berlin Labour Court is basically a step in the right direction. In practice, however, extreme caution is still required when introducing and using electronic signature systems. It is important to ensure that the legal requirements for a substitution of the written form are met. In particular, it must be checked whether the system used is certified as a qualified electronic signature creation device by the Federal Network Agency.