Anyone who is discriminated against during the recruitment process may claim compensation from their employer for lost wages. However, this claim is not valid indefinitely. In a widely noted judgement of 10 September 2026, the Federal Labour Court (BAG) clarified where the employer’s liability ends (Case No. 8 AZR 153/25).
What had happened?
In March 2009, a lawyer from southern Germany applied for a trainee programme in the insurance industry and was rejected. Four other female applicants were accepted. He felt he had been discriminated against on the grounds of his age and gender and took the matter to court. The Hessian Regional Labour Court ruled in his favour in an earlier case and ordered the insurer to compensate him for all future financial losses arising from the failure to recruit him (Case No. 7 Sa 851/17, judgement of 18 June 2018). Following a settlement of 100,000 euros in 2021, the man brought a fresh claim, seeking a further 236,000 euros or so for loss of earnings for the years 2020 to 2023. In doing so, he claimed entitlement to compensation until he reached retirement age.
What was the BAG’s decision?
The Federal Labour Court (BAG) initially confirmed the basic principle: under Section 15(1), first sentence, of the General Equal Treatment Act (AGG), applicants who have been discriminated against may, in principle, claim compensation for lost wages. Liability is not, in principle, capped from the outset.
However, the court sets an important limit: once a person who has been discriminated against has permanently established themselves in a new post commensurate with their qualifications, the former employer’s liability for any further loss of earnings ceases. The reason lies in what is known as the ‘causal link’. This means that there must be a direct link between the discrimination and the damage suffered. Anyone who has successfully established themselves in a new career no longer suffers any further loss of earnings as a result of the rejection they received at the time, but rather due to general occupational risks.
In this specific case, the claimant had, for several years prior to 2020, been carrying out work at the Central Immigration Authority that was in line with his training. The Federal Labour Court (BAG) therefore considered the causal link to the original discrimination in 2009 to have been broken. The court therefore ruled out liability extending until retirement.
What does this mean for employers and female job applicants?
For employers, the ruling provides a degree of clarity: anyone who wrongfully rejects a job applicant and is held liable for doing so does not have to pay compensation for the rest of their life. Once the person concerned has found a suitable new job and achieved stability there, the liability ceases.
For applicants who have been victims of discrimination, this means that a claim for damages is a realistic prospect, provided that the professional disadvantages can be directly attributed to the rejection. However, if the applicant has since successfully reoriented their career, any further claim for compensation lapses.
- Judgment: Federal Labour Court, 10 September 2026, Case No. 8 AZR 153/25
- Previous instance: Hessian Regional Labour Court, 25 March 2025, Case No. 15 Sa 420/23
Anyone who believes they have been discriminated against during a job application, or who, as an employer, is faced with such claims, should seek legal advice at an early stage. The specific circumstances of each individual case will determine the scope of any potential claims or liability risks.
Source: Haufe: Law
This post and the accompanying image were created with the help of AI and have been editorially reviewed.
