Dismissal of the internal data protection officer during insolvency?

General special protection against dismissal

Employee protection enjoys a high priority in German labor law. The special protection against dismissal implemented for specific employee groups emphasizes this.

This is also why employers need to bear in mind the regulations governing special protection against dismissal. The legislation regarding special protection against dismissal imposes strict conditions on or even prevents the ordinary termination of specific employees.

Special protection against dismissal is especially well-known with regard to pregnant women, works council members and people with severe disabilities.

Special protection against dismissal for the internal DPO

A company’s internal data protection officer also enjoys special protection against dismissal: Section 6 (4) sentence 2 of the Federal Data Protection Act (BDSG) stipulates that the employment relationship of an internal data protection officer may only be terminated with due cause. Although the act only explicitly specifies the dismissal of an internal DPO at a public authority, the regulation also applies accordingly to companies. Moreover, the protection against dismissal even remains in force even after the person no longer holds this role: The ordinary termination remains prohibited even one year after the person leaves the role of DPO. During this phase, termination without notice for due cause is the only option pursuant to Section 6 (4) sentence 2 of the Federal Data Protection Act (BDSG) in conjunction with Article 38 (3) sentence 2 of the GDPR.

Doubts about the protection against dismissal of a data protection officer

However, the German Federal Labor Court (BAG) expressed doubts about the compatibility of the German regulations of the BDSG and the GDPR with EU law. In this particular case, a company had issued ordinary notice of dismissal of its internal data protection officer.

The corresponding case was then referred to the Court of Justice of the European Union (CJEU) to decide whether these standards are even applicable. The issue became relevant because the data protection officer had been dismissed for operational reasons as a result of restructuring measures within the company. The company intended to transfer the data protection tasks to an external provider in the future.

Extraordinary dismissal of data protection officers is the only option

However, the CJEU dispelled any doubts regarding the effectiveness of the German regulations (CJEU, decision dated June 22, 2022 – C-534/20), ruling that the special protection against dismissal of the company data protection officer as standardized in the BDSG is compatible with EU law. Consequently, the legal regulations must be applied as they stand: Ordinary dismissal of the data protection officers was not possible. The employer would only have been able to dismiss the data protection officer required by law for due cause.

Special protection against dismissal also in the event of insolvency?

Yet, does the statutory special protection against dismissal of the data protection officer also apply to insolvency? Although this issue was not relevant in the specific case brought before the German Federal Labor Court, employers or insolvency administrators may be confronted with this question on a regular basis.

German law recognizes a special right of termination for companies in ongoing insolvency proceedings: Section 113 of the German Insolvency Code (InsO) states that an insolvency administrator may also terminate employment relationships which have a limited duration or for which ordinary termination is excluded by agreement.

However, the German Insolvency Code makes no reference to employment relationships subject to special protection against dismissal.

Therefore, the special protection against dismissal also trumps the special dismissal rights of the insolvency administrator during insolvency in the case of a data protection officer.