Fixed-term employment contracts are widespread – especially for new hires. However, many fixed terms can be challenged – because the written form is missing, an extension was structured incorrectly or an objective reason does not hold up. In that case, the contract is deemed to be permanent. Here, too, a short deadline for bringing an action is crucial.
Key points at a glance
- Without an objective reason, a fixed term of up to two years with no more than three extensions is permissible (§ 14 Abs. 2 TzBfG).
- The fixed-term agreement must be signed in writing before work begins – otherwise the contract is permanent.
- A fixed term without objective reason is excluded if there has already been an employment relationship with the same employer.
- An action challenging the fixed term (Entfristungsklage) must be brought within three weeks of the agreed end date (§ 17 TzBfG).
- A fixed-term contract can only be terminated with ordinary notice if this has been expressly agreed.
Fixed term without objective reason
Without any particular reason, the employer may limit an employment contract to a term of up to two years and extend it up to three times within this overall period. Special rules apply to newly founded companies in their first four years (fixed term of up to four years, § 14 Abs. 2a TzBfG) and to employees aged 52 and over who were previously unemployed for at least four months (up to five years, § 14 Abs. 3 TzBfG).
The prohibition on prior employment
A fixed term without objective reason is not permitted if there has previously been a fixed-term or permanent employment relationship with the same employer. According to the Federal Constitutional Court (Bundesverfassungsgericht), this applies in principle without any time limit; exceptions are only possible if the previous employment was a very long time ago, was of a completely different nature or was of very short duration – for example a holiday job as a school pupil or a job as a working student. A previous vocational training relationship is not an employment relationship in this sense.
Fixed term with objective reason
If there is an objective reason, a fixed term is possible without a maximum duration. § 14 Abs. 1 TzBfG lists the following examples:
- only a temporary operational need, for example for a time-limited project
- a fixed term following vocational training or university studies, to facilitate the transition
- covering for another employee (parental leave, illness)
- the particular nature of the work, for example in the media and the arts
- a trial period
- reasons relating to the employee personally, for example at their own request
- remuneration from budget funds approved for a limited period
- a court settlement
The objective reason must actually exist when the contract is concluded; it does not have to be stated in the contract. In the case of a fixed term to cover for another employee, the employer must be able to demonstrate a comprehensible chain of causation to the person being covered.
Written form – the most common mistake
The fixed-term agreement must be in writing (§ 14 Abs. 4 TzBfG). Both sides must sign the same document by hand – and they must do so before work begins. If the contract is only signed after the first working day, a permanent employment relationship has already come into being; the subsequent fixed term is generally invalid. Since 2025, there has been an exception for fixed terms ending when the standard retirement age is reached, for which text form is sufficient.
Structuring an extension correctly
An extension within the meaning of § 14 Abs. 2 TzBfG only exists if it is agreed in writing before the expiry of the existing contract and only the term changes. If salary, working hours or duties are changed at the same time, this constitutes a new contract – and because of the prior employment, that is not permitted without an objective reason. If the employee simply continues working after expiry with the employer’s knowledge, the employment relationship is deemed to have been extended for an indefinite period (§ 15 Abs. 6 TzBfG).
Chains of fixed-term contracts
Successive fixed terms based on objective reasons can also be an abuse of rights. The Federal Labour Court (Bundesarbeitsgericht) examines in particular the overall duration and the number of extensions in relation to the limits for fixed terms without objective reason (two years, three extensions). If these are exceeded several times over – for example with a total duration of more than eight years or more than twelve extensions – a comprehensive review for abuse is required; with more than ten years or more than 15 extensions, abuse is likely. Special rules apply in academia under the Academic Fixed-Term Contracts Act (Wissenschaftszeitvertragsgesetz).
The action challenging a fixed term
Anyone who wishes to assert that a fixed term is invalid must bring an action before the Labour Court (Arbeitsgericht) within three weeks of the agreed end date (§ 17 TzBfG). The action can also be brought while the contract is still running. Once the deadline has passed, the fixed term is deemed valid. If you win, a permanent employment relationship exists.
Register as a jobseeker with the Federal Employment Agency (Agentur für Arbeit) no later than three months before a fixed-term contract ends – even if you are hoping for an extension or intend to challenge the fixed term.
Practical examples
The following cases are simplified, typical scenarios from employment law practice. They are for illustration only; every individual case must be assessed separately.
Signature after the first working day
Situation: A warehouse worker starts on 1 March. He signs the contract, limited to one year, on 3 March after the HR department has sent it to him belatedly.
Legal assessment and approach: When he started work, there was no written fixed-term agreement; a permanent employment relationship came into being. The later signature could no longer change this. The action challenging the fixed term was successful.
Extension with a pay rise
Situation: After 18 months, a customer service representative is given a six-month extension; in the same agreement, her salary is increased by €200.
Legal assessment and approach: Because the terms of the contract were changed, this was not an “extension” but a new contract. Because of the prior employment, this was not permitted without an objective reason – the contract was deemed permanent. Employers should therefore agree pay adjustments at a different time.
Former working student later hired on a fixed-term basis
Situation: Eight years ago, a software developer worked at the company for four months as a working student. He is now offered a fixed-term contract without objective reason.
Legal assessment and approach: The previous employment was a long time ago, was short and was of a different nature. In such constellations, a fixed term without objective reason may exceptionally be permissible. Nevertheless, to be on the safe side, we recommended that the employer use an objective reason or a permanent contract with a probationary period.
Parental leave cover without causation
Situation: A clerk is hired on a fixed-term basis “to cover for Ms M. during her parental leave”, but in fact works in a different department with different duties.
Legal assessment and approach: The employer was unable to show how the duties of the absent employee had been redistributed. The objective reason did not hold up; the fixed term was invalid.
Frequently asked questions
Can I be dismissed during the fixed term?
Only if the right to terminate with ordinary notice has been agreed. Summary dismissal for good cause, on the other hand, is always possible.
Does the fixed term also end during pregnancy?
Yes. Maternity protection only prevents dismissals, not the expiry of a valid fixed term. However, not extending a contract because of pregnancy may be discriminatory.
Does my employer have to tell me whether it will extend my contract?
There is no statutory obligation. In the case of contracts limited by purpose, however, the employer must notify you in writing at least two weeks in advance that the purpose has been achieved (§ 15 Abs. 2 TzBfG).
Am I entitled to a permanent contract if colleagues are taken on permanently?
In principle, no. The situation may be different if the selection is discriminatory or a binding promise of a permanent position has been made.
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Note: This information provides a general overview of the legal position (as of November 2026) and does not replace legal advice on your individual case.
This page is a translation of the German original. It is for general information only and does not replace legal advice on your individual case. German version