When an insolvent business is sold, most employees assume either that they lose everything or that everything simply carries on as before. Neither is true. § 613a BGB — the automatic transfer of employment to the acquirer — applies in insolvency, but with employer-friendly modifications that change your liability picture, your severance ceiling and the strategy behind every signature you are asked to give. Insolvency asset deals move fast, and the documents put in front of employees during „rescue” negotiations deserve more scrutiny than almost any other paperwork in working life.
The baseline: § 613a in a nutshell
Outside insolvency, a business transfer (Betriebsübergang) means your employment passes automatically to the acquirer with all rights and duties: tenure, salary, notice period, everything. Dismissal because of the transfer is void (§ 613a(4) BGB), the old and new employer are jointly liable for existing claims, and you can object to the transfer within one month of proper notification (§ 613a(6) BGB).
In insolvency, the skeleton survives — your employment still transfers automatically in an asset deal — but three modifications matter enormously.
Modification 1: the acquirer is not liable for pre-opening claims
Under long-standing Bundesarbeitsgericht case law, the acquirer of a business out of opened insolvency proceedings is not liable for claims that arose before the proceedings were opened. The reasoning: those claims must be satisfied from the insolvency estate under the principle of equal creditor treatment, and an acquirer who had to assume them would simply pay less for the business — draining the estate at the other end.
Practical consequences for you:
- Unpaid salary, bonuses and vacation payout from before the opening are insolvency claims — register them in the Insolvenztabelle, and expect a quota, not full payment. The three-month Insolvenzgeld window covers the tail end at net value.
- Claims arising after the opening — including your salary while the administrator continues the business — are paid in full, and once the transfer completes, the acquirer owes everything from the transfer date onward.
- Occupational pension rights: the acquirer is liable only for the portion earned after the opening; vested pre-opening entitlements are covered by the Pensions-Sicherungs-Verein (PSV).
Your tenure, however, transfers intact: years of service with the insolvent employer count fully at the acquirer for notice periods, KSchG protection and any future severance formula.
Modification 2: severance is capped
Social plans agreed in insolvency are subject to hard ceilings: a maximum of 2.5 monthly gross salaries per employee, and an aggregate cap of one third of the insolvency estate available for distribution (§ 123 InsO). Employees accustomed to the „0.5 to 1.0 monthly salaries per year of service” folklore need to reset expectations — in insolvency, the money for generous social plans usually is not there, unless the acquirer funds the restructuring as part of the purchase price.
Modification 3: dismissals with an acquirer’s concept (Erwerberkonzept)
§ 613a(4) BGB still voids any dismissal issued because of the transfer, even in insolvency. But the case law permits what looks superficially similar: the insolvency administrator may dismiss employees based on the acquirer’s restructuring concept — for instance where the buyer will only take over the business with 60 of 100 employees — provided the concept has taken concrete shape by the time notice is given and its implementation is realistically certain.
Combined with § 128 InsO — which extends the name-list presumption of § 125 InsO to dismissals in connection with a planned business sale — this gives administrators a procedural fast lane. It does not make the dismissals unassailable:
- The concept must be genuinely concrete, not a sketch produced for litigation.
- Social selection, works-council consultation (§ 102 BetrVG) and, in larger reductions, the mass-dismissal notification still apply — the same defects we exploit in mass layoffs appear constantly in insolvency deals.
- The three-week deadline for the Kündigungsschutzklage is unchanged.
The Transfergesellschaft: read before you sign
Many insolvency deals are structured through a transfer company (Transfergesellschaft or BQG): you sign a three-party agreement ending your employment with the insolvent employer and entering a fixed-term relationship with the transfer company, funded by Transferkurzarbeitergeld (§ 111 SGB III) plus an employer top-up, typically for 6–12 months, with job-application coaching. Meanwhile the acquirer hires its chosen staff — often from the transfer company’s pool — free of § 613a.
For some employees this is a decent outcome; for others it is a trap. The agreement usually contains a waiver of dismissal protection, and the pay in the transfer company is materially below your salary. Two things to check before signing:
- Was your onward hiring by the acquirer already agreed or promised? The BAG treats pre-arranged, seamless moves through a transfer company into the acquirer as a circumvention of § 613a — in that case your employment may have transferred with full rights despite the paperwork.
- What exactly are you giving up? Compare the transfer-company package against your litigation position: tenure, procedural defects, and what the acquirer is paying into the deal.
Should you object to the transfer? In insolvency: usually not
Your one-month objection right (§ 613a(6) BGB) survives in insolvency — but exercising it means staying with the insolvent employer. What follows is predictable: the administrator dismisses you with the shortened three-month maximum notice of § 113 InsO, social selection rarely helps you because the transferred jobs no longer exist at the old entity, and any severance comes out of the capped, depleted estate. Objecting only makes sense in narrow scenarios — for example where the acquirer is even less solvent than the estate, or where you have secured another position and want a controlled exit. Get advice before the month runs out; the objection cannot be retracted.
Worked example
An automotive supplier in North Rhine-Westphalia with 220 employees enters insolvency; proceedings open on 1 March. An investor agrees to acquire the plant as of 1 June, taking 150 employees. A production planner, 11 years of service, €4,800 gross / €3,050 net, is owed January and February salary.
- Pre-opening arrears: January and February (€9,600 gross) fall inside the Insolvenzgeld window — she receives ~€6,100 net from the Bundesagentur. The acquirer owes nothing for this period.
- March–May: paid in full by the administrator as estate liabilities (~€14,400 gross).
- She is on the acquirer’s list: from 1 June her employment continues with the acquirer, tenure intact — her notice period and KSchG position reflect 11 years, not zero.
- Her colleague is not on the list: he is dismissed by the administrator citing the Erwerberkonzept, with a social plan paying 0.3 monthly salaries per year of service, capped per § 123 InsO at 2.5 months ≈ €12,000 for his 14 years. His Kündigungsschutzklage reveals the „concept” was a two-page memo and the comparison groups in the name list were drawn arbitrarily; the case settles at €26,500 — the acquirer contributes, because it needs litigation peace before closing.
Frequently asked questions
Does the acquirer have to keep my old salary and conditions?
Yes — the contract transfers as it stands, including salary, tenure and notice periods. Conditions from collective agreements or works agreements transfer subject to the usual § 613a(1) rules (one-year protection where they become part of the individual contract). „New contracts” offered at lower terms right after a transfer deserve legal review before signature.
Can the acquirer dismiss me right after the transfer?
Not because of the transfer — that dismissal is void. Operational dismissals on independent grounds remain possible under the ordinary KSchG rules, with your full transferred tenure counting for social selection. Any dismissal notice starts the three-week clock for a Kündigungsschutzklage.
I received no information letter about the transfer. What does that mean?
The one-month objection period only starts with a complete and correct notification (§ 613a(5) BGB). Defective or missing letters — extremely common in insolvency deals — mean your objection right stays open, sometimes for months. That can be strategic leverage, but use it carefully: objecting into an insolvent estate is rarely attractive.
Is my accrued vacation preserved across the transfer?
Vacation entitlement travels with the employment to the acquirer. Vacation payout claims from periods before the opening, however, are insolvency claims against the estate if the employment ended before transfer — another reason why being on the acquirer’s list matters.
The transfer company offers 80% of my net pay for nine months. Good deal?
It depends on what you are trading away. With strong tenure and a shaky name list, your litigation position may be worth far more than the top-up. With weak KSchG protection or an imminent new job, the transfer company can be a rational bridge. This is a calculation, not a feeling — run the numbers with advice, and check our severance calculator as a starting point.