Facts
The case concerns a 72-year-old employee who sold his automobile garage to a corporation and subsequently concluded an 8-year fixed-term employment contract with the purchaser. The purchaser terminated the employment contract after around one year due to the employee's reduced performance capacity. The employee filed a claim for damages.
The Labor Court awarded the employee compensation of CHF 83,203.- as it considered the termination analogous to a dismissal without notice without the employee's fault. However, the Higher Court overturned this part of the judgment and dismissed the further claim, as it considered the termination to be an ordinary termination in accordance with the employment contract.
Considerations
The Federal Supreme Court confirmed the interpretation of the Higher Court. The employment contract provided for both dismissal without notice and ordinary termination in the event of a "substantial disruption of mutual obligations". This meant a lowering of the termination threshold compared to dismissal without notice, but no application of the compensation regulation for dismissal without notice without the employee's fault.
The Federal Supreme Court stated…