{"id":5117,"date":"2020-09-30T08:00:00","date_gmt":"2020-09-30T06:00:00","guid":{"rendered":"https:\/\/honert.de\/?p=5117"},"modified":"2020-09-30T08:01:09","modified_gmt":"2020-09-30T06:01:09","slug":"transfer-of-business-proportionate-transfer-of-an-employment-relationship-to-several-acquirers","status":"publish","type":"post","link":"https:\/\/honert.de\/en\/transfer-of-business-proportionate-transfer-of-an-employment-relationship-to-several-acquirers\/","title":{"rendered":"TRANSFER OF BUSINESS &#8211; PROPORTIONATE TRANSFER OF AN EMPLOYMENT RELATIONSHIP TO SEVERAL ACQUIRERS?"},"content":{"rendered":"\n<style type=\"text\/css\" data-created_by=\"avia_inline_auto\" id=\"style-css-av-ho8zk6-3af4461504766553b552423f74db5f42\">\n.avia-section.av-ho8zk6-3af4461504766553b552423f74db5f42{\nbackground-repeat:no-repeat;\nbackground-image:url(https:\/\/honert.de\/wp-content\/uploads\/3629.jpg);\nbackground-position:0% 0%;\nbackground-attachment:scroll;\n}\n<\/style>\n<div id='av_section_1'  class='avia-section av-ho8zk6-3af4461504766553b552423f74db5f42 main_color avia-section-default avia-no-shadow  avia-builder-el-0  el_before_av_section  avia-builder-el-first  hide_on_print avia-full-stretch avia-bg-style-scroll av-minimum-height av-minimum-height-40 av-height-40  container_wrap sidebar_right'  data-section-bg-repeat='stretch' data-av_minimum_height_pc='40' data-av_min_height_opt='40'><div class='container av-section-cont-open' ><main  role=\"main\" itemprop=\"mainContentOfPage\"  class='template-page content  av-content-small alpha units'><div class='post-entry post-entry-type-page post-entry-5117'><div class='entry-content-wrapper clearfix'>\n<\/div><\/div><\/main><!-- close content main element --><\/div><\/div><div id='av_section_2'  class='avia-section av-focojq-0d516fbec86912ad9728621fc3779ef2 main_color avia-section-default avia-no-shadow  avia-builder-el-1  el_after_av_section  avia-builder-el-last  avia-bg-style-scroll container_wrap sidebar_right'  ><div class='container av-section-cont-open' ><div class='template-page content  av-content-small alpha units'><div class='post-entry post-entry-type-page post-entry-5117'><div class='entry-content-wrapper clearfix'>\n\n<style type=\"text\/css\" data-created_by=\"avia_inline_auto\" id=\"style-css-av-dvtq06-77fa699c511a29d65b94e7fb683f7507\">\n.flex_column.av-dvtq06-77fa699c511a29d65b94e7fb683f7507{\nborder-radius:0px 0px 0px 0px;\npadding:0px 0px 0px 0px;\n}\n<\/style>\n<div  class='flex_column av-dvtq06-77fa699c511a29d65b94e7fb683f7507 av_two_third  avia-builder-el-2  el_before_av_two_third  avia-builder-el-first  first flex_column_div av-zero-column-padding  '     ><style type=\"text\/css\" data-created_by=\"avia_inline_auto\" id=\"style-css-av-av_heading-5421e1d51f4582b68d922a58e5f90ee7\">\n#top .av-special-heading.av-av_heading-5421e1d51f4582b68d922a58e5f90ee7{\npadding-bottom:10px;\n}\nbody .av-special-heading.av-av_heading-5421e1d51f4582b68d922a58e5f90ee7 .av-special-heading-tag .heading-char{\nfont-size:25px;\n}\n.av-special-heading.av-av_heading-5421e1d51f4582b68d922a58e5f90ee7 .av-subheading{\nfont-size:15px;\n}\n<\/style>\n<div  class='av-special-heading av-av_heading-5421e1d51f4582b68d922a58e5f90ee7 av-special-heading-h1 blockquote modern-quote  avia-builder-el-3  avia-builder-el-no-sibling '><div class='av-subheading av-subheading_above'>30. September 2020\n<\/div><h1 class='av-special-heading-tag '  itemprop=\"headline\"  >TRANSFER OF BUSINESS &#8211; PROPORTIONATE TRANSFER OF AN EMPLOYMENT RELATIONSHIP TO SEVERAL ACQUIRERS? <\/h1><div class=\"special-heading-border\"><div class=\"special-heading-inner-border\"><\/div><\/div><\/div><\/div>\n<style type=\"text\/css\" data-created_by=\"avia_inline_auto\" id=\"style-css-av-ca2w1i-daaf9fe820c3c0ae9a2f1590fe255344\">\n.flex_column.av-ca2w1i-daaf9fe820c3c0ae9a2f1590fe255344{\nborder-radius:0px 0px 0px 0px;\npadding:0px 0px 0px 0px;\n}\n<\/style>\n<div  class='flex_column av-ca2w1i-daaf9fe820c3c0ae9a2f1590fe255344 av_two_third  avia-builder-el-4  el_after_av_two_third  el_before_av_two_third  first flex_column_div av-zero-column-padding  column-top-margin'     ><section  class='av_textblock_section av-kfi0exr2-71f939d9651f932a32e4d34720f54925 '   itemscope=\"itemscope\" itemtype=\"https:\/\/schema.org\/BlogPosting\" itemprop=\"blogPost\" ><div class='avia_textblock'  itemprop=\"text\" ><p><strong>When businesses or parts of businesses are transferred, there is regularly an &#8220;automatic&#8221; transfer of existing employment relationships to the acquirer. The transfer of employment relationships on the occasion of a transfer of business is of great practical relevance and repeatedly the subject of court decisions. In individual cases, difficult questions may arise regarding the allocation of existing employment relationships. The European Court of Justice (\u201cECJ\u201d) has now ruled that the proportional transfer of an employment relationship to several acquirers is also possible in principle. <\/strong><!--more--><\/p>\n<\/div><\/section><\/div>\n<style type=\"text\/css\" data-created_by=\"avia_inline_auto\" id=\"style-css-av-45i12-bf6317ad688ed3631c6858afe4dd4536\">\n.flex_column.av-45i12-bf6317ad688ed3631c6858afe4dd4536{\nborder-radius:0px 0px 0px 0px;\npadding:0px 0px 0px 0px;\n}\n<\/style>\n<div  class='flex_column av-45i12-bf6317ad688ed3631c6858afe4dd4536 av_two_third  avia-builder-el-6  el_after_av_two_third  el_before_av_one_third  first flex_column_div av-zero-column-padding  column-top-margin'     ><section  class='av_textblock_section av-kfi0is1g-9730ff0d611d30e1363c6a7b2a95c6c6 '   itemscope=\"itemscope\" itemtype=\"https:\/\/schema.org\/BlogPosting\" itemprop=\"blogPost\" ><div class='avia_textblock'  itemprop=\"text\" ><h2>1. Tenor of the ECJ judgment<\/h2>\n<p>In its judgment of 26 March 2020, file no. C-344\/18 (ISS Facility NV 7 Sonia Govaerts), the ECJ ruled that in the case of a transfer of business involving several acquirers, the rights and obligations arising from an employment contract are transferred to each of the acquirers on a pro rata basis according to the tasks performed by the employee concerned, provided that the resulting splitting of the employment contract is possible.<\/p>\n<h2>2. Facts of the ECJ ruling<\/h2>\n<p>The ECJ had to decide on the question submitted to it by the Ghent Labor Court on the interpretation of the European Transfer of Business Directive (Article 3 I of Directive 2001\/23\/EC).<br \/>\nIn the main proceedings before the Ghent Labor Court, Ms. Govaerts was employed by ISS Facility Services NV (\u201c<strong>ISS<\/strong>\u201d) since 16 November 1992. ISS was responsible under various lots for the cleaning and maintenance of several buildings in the city of Ghent. Lot 1 included museums and historical buildings, lot 2 libraries and community centers, lot 3 administrative buildings. Ms. Govaerts had been assigned at ISS as project manager for all three lots since 1 April 2013. In the course of a new tendering procedure for the three lots, ISS lost all orders. On 13 June 2013 lots 1 and 3 were awarded to Atalian and lot 2 to Cleaning Masters NV. While ISS assumed that there had been a transfer of business under which the employment relationship between ISS and Ms. Govaerts had been transferred to Atalian, Atalian took the legal position that such a transfer of business did not exist and that there was therefore no contractual relationship between it and Ms. Govaerts. Subsequently, Ms. Govaerts filed a lawsuit against ISS and Atalian before the Ghent Labor Court for payment of compensation for termination. The Labor Court ordered ISS to pay this compensation for termination, but dismissed the action against Atalian as inadmissible. The Ghent Labor Court assumed that there had been no transfer of business concerning Ms. Govaerts\u2019 employment relationship because she performed administrative and organizational tasks but did not participate in the cleaning work in the affected buildings which were the subject of the transfer of business. In the appeal proceedings before the Ghent Labor Court of Appeal, ISS submitted its opinion that 85% of Ms. Govaerts\u2019 employment relationship had been transferred to Atalian and 15% of it to Cleaning Masters NV. The Ghent Labor Court of Appeal assessed the facts of the case differently from the decision of the Ghent Labor Court and assumed that there was a transfer of business within the meaning of the Transfer of Business Directive in accordance with the transposing Belgian legislation, which also covered the claimant&#8217;s employment relationship. According to the Ghent Labor Court of Appeal, this must have resulted in a legally ordered transfer of the employment relationship from Ms. Govaerts to Atalian and Cleaning Masters NV.<br \/>\nIn order to clarify the conformity of this outcome with European law, the Ghent Labor Court of Appeal suspended the proceedings and referred the questions to the ECJ for a preliminary ruling as to whether (1) in the event of a transfer of an economic entity to different acquirers, the employment relationship of an employee who was employed in each of the transferred parts is transferred to each acquirer to the extent of the employee&#8217;s activity, (2) the employment relationship is transferred to the acquirer of those parts of the company in which the employee was mainly employed or (alternatively) (3) in such a case there is no transfer of the employment relationship at all.<\/p>\n<h2>3. ECJ ruling<\/h2>\n<p>In the starting point, the ECJ stated that the Transfer of Business Directive does not regulate the case of the transfer of an employment relationship to several acquirers. At the same time, the ECJ takes into account the objective of the Transfer of Businesses Directive to ensure, as far as possible, the continuation of employment relationships with the transferee in unchanged form in order to prevent a deterioration of the situation of the affected employees solely as a result of the transfer. In addition to the protection of the affected employees, the Transfer of Businesses Directive also seeks to balance the interests of the acquirer. The ECJ further clarifies that for the question of the existence of a transfer of business it is irrelevant whether the economic unit is transferred to one or more acquirers. The ECJ thus ruled out the third variant of the question submitted by the Ghent Labor Court of Appeal, namely that the claimant&#8217;s employment relationship was not covered by the transfer of business at all.<br \/>\nIn the context of the examination of the submitted question, whether the employment relationship is transferred only to the acquirer with whom the employee mainly performs his tasks, the ECJ comes to the conclusion that this does not sufficiently take into account the interests of the acquirer concerned. This is because a full-time employment contract is transferred to this acquirer, but the employee in question would have to perform the duties in question only on a part-time basis, namely to the extent that he worked for the previous employer for this part of the business. As a consequence, the ECJ affirms a proportionate transfer of the employment relationship to each acquirer according to the tasks performed by the employee. The ECJ considers this to be a balance between the interests of the employees and the respective interests of the acquirer. The practical consequences of the implementation of such a division of an employment relationship between several acquirers must be decided by the national court in the light of national employment law provisions. The ECJ considers the economic value of the lots as well as the time actually spent on each lot to be admissible as a criterion for allocation.<\/p>\n<h2>4. Consequences for the practice in Germany<\/h2>\n<p>The ECJ ruling seems problematic for labor law practice. The allocation of employees in partial business transfers has already given rise to controversy in the past.<br \/>\nAccording to the case law of the German Federal Labor Court (<em>Bundesarbeitsgericht<\/em>; \u201c<strong>BAG<\/strong>\u201d), the circumstances at the time of the transfer of business shall be decisive for such classification. Contentwise the allocation is to depend primarily on the intention of the parties to the employment contract. If an assignment is by this means not possible, it must be made according to objective criteria. The BAG focuses on whether the employee was actually (partially) integrated into the transferred business. In order to belong to this part of the business it is not sufficient if the employee has only (also) performed activities for this part of the business. In fact, the BAG&#8217;s case law focuses rather on the part of the company in which the employee was predominantly employed, i.e. the main part of the company, and also applies this criterion to temporary activities in other parts of the company. If, after examining these criteria, it remains unclear to which part of the business the employee concerned belongs, the case law of the regional labor courts in Germany, together with parts of the legal literature, assumes that the employee has the right to choose, based on his right of objection, whether it wants to be assigned to the remaining or the acquired part of the business.<br \/>\nThe ECJ now opposes the established case law of the BAG on the so-called priority formula for the assignment of employees to transferred parts of the business with a contrary legal interpretation which cannot be disregarded by the German labor courts. The question of how the division of an employment relationship is to be legally implemented in practice remains open. Furthermore, it is questionable whether in comparable cases the German labor courts would have accepted a transfer of the claimant&#8217;s employment relationship under sec. 613a German Civil Code (<em>BGB<\/em>) at all. In the case of employees who, as in the case decided by the ECJ, perform administrative tasks, it is not uncommon to come to the conclusion that their employment relationships are not transferred under the transfer of business. Instead of (artificially) splitting the employment relationship of administrative employees to several acquirers, it seems more obvious that only the employees who were involved in cleaning activities under the various lots in the sub-companies were transferred to the respective acquirer, but not employees of the administrative body. These regularly remain with the former owner of the transferred business. It remains to be seen whether this result, which appears appropriate in a large number of cases, is to be held against the background of the ECJ&#8217;s decision.<br \/>\nIn the decision discussed above, the ECJ expressly rejected the third question submitted (alternatively) by the Ghent Labor Court of Appeal as to whether there was no transfer of the claimant&#8217;s employment relationship to a transfer of business. It also remains to be seen how the Ghent Labor Court of Appeal will decide the case against the background of Belgian labor law and whether it will split the employment relationship between the two acquirers.<\/p>\n<\/div><\/section><\/div>\n<style type=\"text\/css\" data-created_by=\"avia_inline_auto\" id=\"style-css-av-8z673q-2fca6039dff3d3fcf4719d121f87a224\">\n.flex_column.av-8z673q-2fca6039dff3d3fcf4719d121f87a224{\nborder-radius:0px 0px 0px 0px;\npadding:7px 0px 0px 0px;\n}\n<\/style>\n<div  class='flex_column av-8z673q-2fca6039dff3d3fcf4719d121f87a224 av_one_third  avia-builder-el-8  el_after_av_two_third  avia-builder-el-last  sy-only-desktop hide_on_print flex_column_div  column-top-margin'     ><p><div  class='avia-builder-widget-area clearfix  avia-builder-el-9  el_before_av_textblock  avia-builder-el-first '><section id=\"categories-3\" class=\"widget clearfix widget_categories\"><h3 class=\"widgettitle\">Newsletter issues<\/h3>\n\t\t\t<ul>\n\t\t\t\t\t<li class=\"cat-item 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href=\"http:\/\/9zh.f5b.myftpupload.com\/en\/taetigkeitsgebiete\/labor-and-employment-law\/\">Labor and Employment Law<\/a><\/li>\n<li><a href=\"http:\/\/9zh.f5b.myftpupload.com\/en\/taetigkeitsgebiete\/restructuring\/\">Restructuring<\/a><\/li>\n<li><a href=\"http:\/\/9zh.f5b.myftpupload.com\/en\/taetigkeitsgebiete\/employment-law\/\">Employment Law<\/a><\/li>\n<\/ul>\n<\/div><\/section><br \/>\n\n<style type=\"text\/css\" data-created_by=\"avia_inline_auto\" id=\"style-css-av-4u9wfa-d746534e6cb09de5d7f9c90327c8b852\">\n#top .hr.hr-invisible.av-4u9wfa-d746534e6cb09de5d7f9c90327c8b852{\nheight:8px;\n}\n<\/style>\n<div  class='hr av-4u9wfa-d746534e6cb09de5d7f9c90327c8b852 hr-invisible  avia-builder-el-11  el_after_av_textblock  el_before_av_textblock '><span class='hr-inner '><span class=\"hr-inner-style\"><\/span><\/span><\/div><br \/>\n<section  class='av_textblock_section av-2ilus6-0a39246e2c4f14b471c337d7c48e411e '   itemscope=\"itemscope\" itemtype=\"https:\/\/schema.org\/BlogPosting\" itemprop=\"blogPost\" ><div class='avia_textblock hide_on_print'  itemprop=\"text\" ><h2>Downloads<\/h2>\n<p><a href=\"#\" onclick=\"window.print();return false\">Print<\/a><br \/>\n\n\n\n\t<div class=\"dkpdf-button-container\" style=\" text-align:left \">\n\n\t\t<a class=\"dkpdf-button\" href=\"\/en\/wp-json\/wp\/v2\/posts\/5117?pdf=5117\" target=\"_blank\"><span class=\"dkpdf-button-icon\"><i class=\"fa fa-file-pdf-o\"><\/i><\/span> Download (PDF)<\/a>\n\n\t<\/div>\n\n\n\n\n\n<\/p>\n<\/div><\/section><\/p><\/div><\/div><\/div><\/div><!-- close content main div --><\/div><\/div><div id='after_section_2'  class='main_color av_default_container_wrap container_wrap sidebar_right'  ><div class='container av-section-cont-open' ><div class='template-page content  av-content-small alpha units'><div class='post-entry post-entry-type-page post-entry-5117'><div class='entry-content-wrapper clearfix'>\n","protected":false},"excerpt":{"rendered":"<p>When businesses or parts of businesses are transferred, there is regularly an &#8220;automatic&#8221; transfer of existing employment relationships to the acquirer. The transfer of employment relationships on the occasion of a transfer of business is of great practical relevance and repeatedly the subject of court decisions. In individual cases, difficult questions may arise regarding the allocation of existing employment relationships. The European Court of Justice (\u201cECJ\u201d) has now ruled that the proportional transfer of an employment relationship to several acquirers is also possible in principle. <\/p>\n","protected":false},"author":26,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"mc4wp_mailchimp_campaign":[],"footnotes":""},"categories":[162],"tags":[],"class_list":["post-5117","post","type-post","status-publish","format-standard","hentry","category-2020-q3-en"],"acf":[],"_links":{"self":[{"href":"https:\/\/honert.de\/en\/wp-json\/wp\/v2\/posts\/5117","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/honert.de\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/honert.de\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/honert.de\/en\/wp-json\/wp\/v2\/users\/26"}],"replies":[{"embeddable":true,"href":"https:\/\/honert.de\/en\/wp-json\/wp\/v2\/comments?post=5117"}],"version-history":[{"count":7,"href":"https:\/\/honert.de\/en\/wp-json\/wp\/v2\/posts\/5117\/revisions"}],"predecessor-version":[{"id":5206,"href":"https:\/\/honert.de\/en\/wp-json\/wp\/v2\/posts\/5117\/revisions\/5206"}],"wp:attachment":[{"href":"https:\/\/honert.de\/en\/wp-json\/wp\/v2\/media?parent=5117"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/honert.de\/en\/wp-json\/wp\/v2\/categories?post=5117"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/honert.de\/en\/wp-json\/wp\/v2\/tags?post=5117"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}