No automatic forfeiture of leave in the absence of cooperation by the employer - UPDATE

Back in 2019, the European Court of Justice (ECJ) caused a stir with its decisions on vacation law (summarized by us under: Holiday law). The ECJ's decision that leave does not automatically expire at the end of the year or at the end of the carry-over period is particularly important in practice. The ECJ's requirements in this regard were immediately implemented by the Federal Labor Court (BAG) in its decision of 19.02.2019 - 9 AZR 541/15. If leave is to expire at the end of the year, employers now have the burden of taking the initiative and must give their employees specific notice, which must be given in good time in the calendar year (e.g. at the end of the 2nd quarter) so that the employee still has the opportunity to take their leave.

Please note: If vacation is carried over to the new calendar year, it is essential that a new notification is issued. This must be separate from the notification of the current calendar year's leave due to the different expiry periods of the various leave entitlements and should be issued in good time so that the remaining leave from the previous year can still be taken by the end of the carry-over period (this is usually March 31). If this information is not provided, the remaining leave entitlement will be added to the leave for the new calendar year - until the employer provides the information!

The information, which in future should be provided once at the beginning of the year with regard to the remaining leave from the previous year and once in the middle of the year with regard to the current leave entitlement, should contain the following information in accordance with case law:

  • the number of vacation days to which the employee is entitled in the calendar year or in the carry-over period

  • A request to apply for annual leave in good time so that it can be taken within the current leave year

  • Instruction on the consequences (expiry at the end of the calendar year or, in the case of carry-over, at the end of the carry-over period)

In particular, the individual notification of the specific number of vacation days for each individual employee will lead to a considerable amount of work in larger companies and is simply not practicable. Due to the lack of specific legal requirements, the employer is basically free to choose the means it uses to fulfill its obligations to cooperate. However, the means must be appropriate to the purpose. They must be suitable to enable the employee to decide freely, in full knowledge of all relevant circumstances, whether to take their leave. In order to avoid excessive effort by providing individual notifications to individual employees and still fulfill the duty to inform, we believe that employees should at least be informed of where the amount of their current leave entitlement can be viewed. Abstract information, for example in the employment contract, in a leaflet or in a collective agreement, will not meet the requirements of specific and transparent information according to case law.

Employers should definitely take the duty to inform seriously, as in the opinion of the BAG, the statute of limitations does not apply, which is why vacation entitlements from many previous years could still be asserted under certain circumstances. The employer can only effectively avoid the unrestricted accumulation of vacation entitlements from several years by making up for its obligations to cooperate with regard to vacation from previous vacation years in the current vacation year. If, in such a case, the employee does not take the accumulated leave entitlement in the current leave year, although he/she would have been able to do so, the leave expires at the end of the calendar year or a (permissible) carry-over period. If the employer has tied the leave entitlement to the leave year or the carry-over period by fulfilling its obligations to cooperate and the employee nevertheless does not request that leave be granted, the entitlement expires at the end of the leave year or at the end of the carry-over period in accordance with Section 7 (3) sentence 1 BUrlG.

The BAG has not yet decided what happens to the vacation entitlements of employees on long-term sick leave. The LAG Hamm has already dealt with the issue and does not believe that the employer has a duty to inform the employee, as the effect of the instruction cannot occur if it is not possible for the employer to enable the employee to actually take the leave. However, as soon as the employee is healthy again, he or she must be informed, according to the Hamm Higher Labor Court. We therefore recommend informing the employee who has been on long-term sick leave individually as soon as they are able to work again and documenting the information provided.

Date: 19. Feb 2020