We receive many enquiries on the subject of references, and there is generally a great deal of uncertainty. Our consulting practice shows that there are considerable differences in the quality of references and that missing or unclear references can lead to our outplacement clients breaking off ongoing job interviews.
The reference is a "badge" for the specialist or manager. It provides information about the task, length of service, performance and leadership behavior. The legal rights to a reference are regulated by law. It must be benevolent, but true and factually correct. The reference is a debt to be collected and must be issued in good time.
The simple reference is primarily found in the commercial sector. For salaried employees and managers, a qualified reference is usually prepared. In the case of long-term employment, an interim reference can also be important.
Over the years, a standard has been established for the structure of references. This standard makes it easy for the reader to quickly grasp a reference and is therefore also recommended for your reference. Finally, there are hidden grades for performance, leadership, resilience, loyalty, etc. in the coding of references.
According to case law, the reference must be "true" and factually correct. The employer must strive for the greatest possible objectivity, at the same time the assessment of the performance should be based on reasonable goodwill. The employee's career advancement should not be impeded. This balancing act between the duty of truth and goodwill is often difficult to achieve.
Pursuant to § 630 BGB, all employees have a claim to the issuance of a reference (in German, at the employer's expense). This entitlement is mandatory. The issue of a reference cannot be waived before the end of the employment relationship. (For commercial employees see § 73 HGB, for industrial employees see § 113 GewO).
Senior executives are employees and therefore have a right to a reference. Whether legal representatives or legal bodies (e.g. board member of an AG) have a right to a reference is disputed. In any case, according to general opinion, the GmbH managing director who is not at the same time a (majority) shareholder is entitled to this claim.
Entitlement to a reference only in the case of a permanent employment relationship
The prerequisite for the right to a reference pursuant to § 630 BGB is a permanent employment relationship. It is sufficient if the employment relationship was of a permanent nature, even if it did not actually last long. Even if the employment was only short (e.g. two days), there may be a claim to the issuance of a qualified reference. However, an assessment problem arises here. Even in the case of fixed-term contracts or if the probationary period has not been survived, the employee is entitled to a reference. This is because in both cases there is a (fully-fledged) employment relationship.
The employer is obliged to issue the certificate
He can be represented by an employed agent who has to fill in the certificate in his name. The vicarious agent must, however, be recognizably higher in rank than the person being appraised. The evaluation by equals (or even subordinates) would violate good faith because of the disrespect involved. It is inadmissible to have the certificate issued by a lawyer (who has been commissioned to represent the interests of the employee).
Certificate in the case of bankruptcy
In the case of bankruptcy, the bankruptcy administrator is obligated to issue the reference - also for the past time - if he continues the business (BAG).
The employee is obliged to fetch the reference
The reference is to be fetched - like other working papers - by the employee/manager. The employer is only obliged to keep the reference ready. If the certificate is not handed over upon termination of the employment relationship and if the employer is responsible for this, he must send the certificate to the employee at his risk and expense.
According to Section 630 of the German Civil Code (BGB), the simple employer's reference only covers the type and duration of the employment relationship. Personal details such as first name and surname, academic degree, profession as well as the date of issue and signature of the employee must appear from the reference. The nature of the activity must be described precisely and completely so that a future employer can form a picture of the tasks performed.
The simple reference (without statement on performance and conduct) is extremely rare in the case of executives. Such a reference is not advisable. It could lead to the damning verdict that there is nothing (positive) to report about the executive's performance. In principle, the employee has the right to choose whether he wants a simple or a qualified reference. After receiving a simple reference, a qualified reference can still be requested.
The employee is entitled to a reference "upon termination of employment". The right to an interim report is not regulated by law. In some cases, however, the employee can demand an interim report in accordance with collective bargaining regulations.
Even without collective bargaining provisions, the right to an interim report during the employment relationship is generally affirmed if the employee has a legitimate interest. This follows from the employer's duty of care (e.g. to make it easier for the employee to find a job, see § 629 BGB).
In certain cases, the general opinion is that the employee is entitled to an interim reference:
- the employer is considering a termination in the near future
- a transfer within the company is imminent
- the superior changes
- the superior leaves the company
- A reorganization of the company is imminent
The same principles apply to the form and content of the interim reference as to the final reference. The employer does not have to use the formulations of the interim reference in the final reference; in practice, however, this is often the case.
If the reference contains information about performance and leadership, it is a so-called qualified reference. The extension to performance and leadership only takes place if the employee requests this (§ 630 sentence 2 BGB).
In the following text, we therefore deal exclusively with this type of certificate. In the assessment of performance, it must be explained how the employee has fulfilled the tasks incumbent upon him or her under the contract. The statements on leadership concern the social behaviour, especially towards superiors and colleagues.
As a matter of principle, you should insist on the preparation of a qualified reference. Anything else reflects very badly on you.
In principle, it is up to the employer to formulate the reference. He is free to decide which of the employee's achievements and characteristics he wishes to emphasise or de-emphasise. The reference must be true and may not contain omissions even where the reader expects a positive emphasis. On the other hand, the reference must not unjustifiably impede the employee's advancement. According to the Federal Labor Court, it must be supported by reasonable goodwill towards the employee.
The formulation of every reference is subject to this tension between the duty of truth and goodwill. However, the testimony can only be reasonably benevolent within the framework of truth. This means that between these two principles, in case of doubt, truth takes precedence over benevolence.
The structure of a qualified certificate is generally based on the following model:
- Personal data
- Type and duration of employment
- Tasks and description of responsibilities
- Assessment of performance and results
- Behaviour towards superiors, colleagues and employees
- Final wording (so-called magic four)
- Date and signature
- The reference must be issued in writing and signed. In its external form, it must meet the minimum requirements customary in business life.
- As a rule, the certificate must be issued on company stationery with proper letterhead, from which the name and address of the issuer are recognizable. The employee may reject an uncleanly written reference (spelling mistakes, corrections, deletions, creases, stains).
- The external form must not give the impression that the issuing employer is distancing himself from the wording of his certificate.
- Secret signs intended to mark the employee in a positive or negative way are not permitted. Quotation marks, exclamation marks and underlining are also not permitted.
Very often you can exert considerable influence on the wording of the reference, as you relieve the parties involved of what is often perceived as unpleasant work. If you leave the company in the context of a termination of the employment contract, make sure to agree on the reference as an annex to the termination agreement. This way you will avoid unpleasant surprises.
The so often questioned reference code usually refers to the performance appraisal of the employee. The performance appraisal is certainly the most important section in a reference, which is usually formulated in the back of the reference. The performance appraisal covers several dimensions:
Summary performance appraisal of work performance Always included is the summary performance appraisal, which includes the following wording, for example: "Overall, the performance of Mr./Mrs. Mustermann was to our .... satisfaction". Different formulations are conceivable here. We have compiled the common assessments and what they mean in terms of school grades for you under the point Report grades.
Behaviour towards superiors Example of a poor assessment: "Behaviour on duty was appropriate". A very good assessment, on the other hand, might look like this: "His conduct towards superiors and co-workers was always exemplary."
Leadership characteristics This is about exercising leadership responsibility, motivation, and last but not least, employee results. An example of an average rating: "He empowered his employees to achieve targets independently according to clear planning."
In addition, there are numerous assessment formulations for the employee's ability to work under pressure, working methods, flexibility or working style. For example, the verdict "under guidance, he was able to comprehend more complex issues and was open-minded towards innovations" would be scathing.
Exceptionally good / very good
- We have been exceptionally satisfied with his services at all times and in all respects.
- Its performance has at all times and in all respects met with our fullest appreciation.
- It has always carried out the work assigned to it to our complete satisfaction.
Above average / good
- We have been fully satisfied with his performance throughout the period of employment.
- His performance has received our full appreciation.
- She has always completed the work assigned to her to our complete satisfaction.
Average / satisfactory
- We have been fully / at all times satisfied with his/her performance.
- He / She has met our expectations in every respect.
- He / she has completed the work assigned to him / her to our full satisfaction.
Below average / not satisfactory
- We were satisfied with their performance.
- He / she has worked satisfactorily.
- He / she has done the work assigned to him / her to our satisfaction.
Poor / bad
- She performed the tasks assigned to her with diligence and interest.
- His performance more or less met our expectations.
- He performed the work assigned to him to our satisfaction on the whole.