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Compensation Payments for Vacation or Holiday Leave Time Entitlements According to Labour Law

If an employee waives compensation for leave in the context of a settlement with the employer, EU law cannot stand in opposition to such a waiver.


Cologne, NRW -- (SBWIRE) -- 06/20/2013 -- GRP Rainer Lawyers and Tax Advisors in Cologne, Berlin, Bonn, Bremen, Dusseldorf, Essen, Frankfurt, Hamburg, Hanover, Munich, Nuremberg, Stuttgart and London conclude: In such a context, nothing stands in opposition to the relinquishment of the employee except when there are individual contractual agreements which lead to a total exclusion of the existence of a relevant claim. Such a decision was issued by the German Federal Labour Court (BAG)

In general, German labour law awards an employee with a compensation claim if the employee is not allowed to make use of holiday or vacation leave time in its entirety or only partially due to the termination of employment.

The BAG ruled in its judgment from 14 May 2013 (Az. 9 AZR 844/11) that an employee’s waiver of this claim does not stand in opposition to EU law. In this particular case, the circumstances included a temporarily disabled man who was terminated by the defendant. Within the framework of the termination, agreements should have been made providing the basis for severance payment. In addition, it was allegedly further determined that all financial claims arising from the employment relationship had been completed mutually in fulfillment of the settlement agreement. Even at that, the plaintiff asked the defendant at a later point in time in writing to apply leave entitlements from a previous period in time.

Previously, proceedings were conducted by the Employment Tribunal and Regional Labour Court. After the Employment Tribunal Chemnitz had dismissed the action in its judgment from 20 December 2010 (Az. 11 CA 2485/10), the former employer was ordered to pay compensation within the context of the appeal by the Regional Labour Court of Saxony in its judgment from 26 May 2011 (Az. 9 SA 86/11).

The BAG did not share this view, rescinded the judgment decision of the Regional Labour Court in appeal proceedings and thus restored the judgment of the Employment Tribunal. The BAG justified its decision on the grounds that the settlement clause of the court settlement also covers the compensation claim of the employee for statutory vacation time.

In all legal issues relating to the conclusion of the contract, warning notice or effective termination notice, affected employees should seek counsel from an attorney actively employed in the field of labour law. It should be noted that short deadlines must often be observed in the area of labour law.

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