Definition
Labour court proceedings incur two types of costs: court fees and legal fees. A distinctive feature of the first instance is that each party bears its own legal costs, regardless of who wins. In the appeal proceedings, the standard principle applies: the losing party pays. Legal expenses insurance with an employment law cover option can cover your own legal fees. The prerequisite is that the dispute arose after the insurance cover began.
Specialist solicitor in employment law
With over 15 years’ experience in employment law
Classification under employment law
In labour court proceedings at first instance, each party bears its own legal costs – regardless of the outcome (Section 12a of the Labour Court Act (ArbGG)). Court fees are only incurred in the event of a settlement or a judgment. Legal expenses insurance may cover one’s own legal costs.
Distinction from related terms
Court costs: Court costs arise from the proceedings themselves and are set by the court. Legal costs also include legal fees and other expenses.
Legal expenses insurance: Legal expenses insurance may cover the costs of labour court proceedings. However, it does not replace the statutory provisions regarding the bearing of costs in the proceedings.
Practical tip
It is best to take out employment legal protection insurance before a dispute arises – as a waiting period usually applies following dismissal or a dispute, or the insured event may already have occurred. You should also check whether you are entitled to legal advice or legal aid.
