Scope of attorney’s authority to waive claims in a termination agreement

The Federal Labour Court (BAG) reversed the decision of the Düsseldorf Regional Labour Court and dismissed the employee-plaintiff's appeal, thereby reinstating the lower court's judgment that favored the employer-defendant and ordering the plaintiff to bear the costs of the appellate and revision proceedings. The dispute concerned the validity of a termination agreement negotiated by the employee's legal counsel in the context of a workplace dispute, where the core issue was whether the attorney’s authority to conclude the agreement was validly extended to cover specific contractual waivers. The BAG applied the doctrine of *Vollmacht* (authority) and the requirements for *Anwaltsverhandlung*, determining that the legal basis and scope of the counsel's representation did not adequately cover the specific claims waived in the settlement, rendering the plaintiff's acceptance of the terms legally ineffective.