German labor courts regard accepting a free VIP lounge ticket as unlawful acceptance of benefits, therefore breach of employment contract and cause for dismissal with immediate effect.

According to a recent ruling of the State Labor Court in Rheinland-Pfalz (Landesarbeitsgericht) the acceptance of a VIP lounge ticket by a senior employee is a serious violation of the prohibition of bribe taking (ruling of 01/16/2009 - 9 Sa 572/08). Such acceptance justifies dismissal with notice for misconduct without prior warning. The court holds that such conduct can even be sufficient to justify dismissal with immediate effect without notice and without prior warning.

In the case at issue, a human resources director accepted a free VIP Lounge ticket for a soccergame (VIP lounge including business entertainment) as a gift from a temporary employment company that provided services for the director's employer. It was his task to negotiate potential contracts with this company; consequently he had influence over whether it would be retained. The ticket was of considerable value (€ 250). Thus the ticket as a "gift" presented a danger that the plaintiff, the HR director, would no longer safeguard his employer's interests.  With the breach of the prohibition of bribe taking, the employee destroyed the confidence required to maintain the employment relationship. The employee should have been aware of the fact that such conduct was not acceptable, which also made a warning unnecessary.

Although such conduct may, in some circumstances, justify dismissal with immediate effect, the court rejected such treatment under the facts of the case. In the decision, the State Labor Court held that the conduct in dispute justified dismissal with notice only. The court took into account the considerable seniority of the employee without prior complaints and his lack of chances to find a new job. Termination with immediate effect was therefore considered to be inappropriate.

The ruling differs from a recent ruling of the Local Labor Court in Munich (ruling of 10/02/2008 - 13 Ca 1719/07). The Munich court ruled that the dismissal without notice of a corrupt senior employee of a wellknown technology corporation to be invalid. The Labor Court argued that the corporation was equally responsible for the corrupt business practice.

Every human resources executive immediately realizes that many problems may arise in such cases: Each case is fact-specific and requires a case-by-case determination of whether warning is appropriate . Another source of insecurity is the balancing of interests required by the courts. Conduct that is acceptable in one circumstance may be unacceptable in others and destroy the confidence required for the employment relationship. With respect to corruption, in many cases dismissal is the only reasonable option with respect to a company's compliance policy. Otherwise there may be an impression that the company tolerates misconduct.