Is a reduction of holiday entitlement permitted during short-time work?

The “Covid-19” crisis is constantly presenting employees and employers with new challenges. One of the major current issues is the relationship between short-time work and holidays.

In order to avoid the loss of working hours, the remaining leave from the previous year must first be brought in. Now the question arises, however, whether the holiday entitlement can be reduced due to short-time work.

What is the legal situation so far?

The prevailing opinion in labour law literature is in favour of reducing holiday entitlement in the event of short-time working. You are in good company with the ECJ (European Court of Justice) in this respect.

The Court of Justice has ruled that it is not contrary to Union law for the holiday entitlement of a (transfer) short-time worker to be reduced in proportion to the reduction in working hours by short-time working. Although this concerns the statutory minimum leave, it also applies to contractual additional leave. Thus, the (complete) holiday entitlement can be reduced proportionately – as is the case with part-time employees. If “short-time work zero” is ordered, no holiday entitlement would arise for this period.

Automatic reduction of the holiday entitlement or only with contractual regulation?

However, the question of whether the reduction of vacation entitlements during short-time work as described above occurs automatically or whether it requires an explicit regulation in this regard, e.g. in an employment contract, collective bargaining agreement or works agreement, has not yet been clarified. A supreme court decision by the BAG (Federal Labor Court) is still pending.

Likewise, there is currently no explicit (reduction) regulation in national law, such as for periods of parental leave or care leave. In any case, the ECJ decision cited above contained a corresponding works agreement.

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Questions about labour law in Corona times?

Christian Seidel

Rechtsanwalt, Fachanwalt für Arbeitsrecht
Prokurist der Acconsis GmbH Rechtsanwaltsgesellschaft

+ 49 89 547143
or by e-mail

My recommendation

Against this background, employers are recommended to either reach an agreement with the employee or to await a decision of the highest court on this issue. Otherwise, you run the risk that the employee will resist the reduction of his or her holiday entitlement to an unreasonable degree.

If you need assistance, please contact me. I am happy to help you.