Managing Director as employee

The Constitutional Court's ruling highlights the importance of the proper wording of contracts for managing directors who are at the same time employees of the company. Cases in which the job description of an employee partially overlaps with the function of a managing director require careful regulation and approval by the general meeting.

In practice, the concurrence of an executive director’s position with an employment contract is very complex, and it is important to take into account a number of specific circumstances. The risk of directors or senior management having invalid contracts is not at all uncommon in such situations.