Germany: Two EWC labor court decisions

Employers in Germany can use generative AI without works council codetermination as long as they don't monitor it.

Why it matters: This information is important for employers in Germany who want to implement AI technologies without negotiating with works councils. It allows them to use generative AI tools like ChatGPT without the need for codetermination, as long as certain conditions are met.

In a recent judgment, the Labor Court of Hamburg confirmed that employers can use ChatGPT without works council codetermination if monitoring is not conducted. Employers must ensure that employees use ChatGPT via private accounts, with no local software installation, no monitoring of network traffic, and no contract with OpenAI for log data.

The bottom line: Employers in Germany can benefit from the court's decision by using generative AI tools like ChatGPT without negotiating with works councils, as long as they adhere to the specified conditions.

On a separate note, employers in Germany face the risk of invalidating terminations due to minor formal mistakes in mass dismissal notifications. However, a pending change in case law could potentially alter this high-risk situation.

Additional material:

Employers can also prohibit the use of generative AI without the works council having a right of codetermination. A good reason for this is, for example, if the protection of trade secrets and customer data is a top priority. See: https://lnkd.in/eBC7nd55

See recent article from L&E Global - quote:

If large-scale redundancies are planned, employers must comply with the complex requirements of the consultation and collective redundancy notification procedure in accordance with Section 17 of the German Protection against Dismissal Act (KSchG). In particular, the competent unemployment agency must receive a mass dismissal notification before terminations are issued to the affected employees. Mistakes in this context lead to the invalidity of the terminations according to previous case law. In light of this, employers have been subject to high risk that even minor formal mistakes in the submission of mass dismissal notifications would render the terminations issued to employees based on such notification invalid. This could now potentially change due to a pending change in case law.