German Nursing Staff Win Key Sick-Pay Ruling as Reform Sparks Debate Over Billions in Cuts

German labor court strengthens sick pay for on-call care workers; reform package threatens €7.6B deficit, cuts to wages and pensions.

A recent decision by Germany’s Federal Labor Court (Bundesarbeitsgericht) has strengthened the hand of care workers assigned to on-call duty – just as a sweeping reform package threatens to slash billions from the long-term care insurance system. The ruling, case number 6 AZR 210/22, makes clear that nurses whose scheduled standby shifts are lost due to illness remain entitled to wage continuation, even when their employer follows church-based contract guidelines such as the AVR Caritas.

Judges held that those guidelines cannot override statutory minimum protections for employees. Since the AVR Caritas and similar directives do not qualify as collective bargaining agreements in the legal sense, the default entitlement to continued pay in the event of sickness remains in full force. The court did not decide whether the compensation must be paid in cash or granted as time credits – that issue remains open.

The ruling lands amid a broader clash over the future of Germany’s care sector. In early June 2026, the Federal Health Ministry unveiled the draft Nursing Reorganization Act (PNOG), a package aimed at plugging massive deficits in the statutory care insurance fund. Shortfalls are projected at €7.6 billion for 2027, swelling to over €17 billion by 2030.

The planned cuts include:

• Suspension of tariff loyalty: The requirement that care providers pay collectively bargained wages would be frozen for four years starting 2 January 2027. Unions and state politicians call it an assault on pay levels.
• Reduced pension contributions: The care insurance fund’s contributions for family caregivers would drop to 70%, saving roughly €2 billion annually.
• Indexation shift: Starting in 2028, benefit adjustments would be linked to wage growth rather than inflation, and access to care grades would be tightened.

Social welfare organizations are also warning that health insurers have been pressuring recipients of sick pay (Krankengeld). According to the SoVD Schleswig-Holstein, some insurers have demanded that insured people independently contact rehabilitation clinics to force earlier admission dates – threatening to stop sick pay if they fail. Legal experts stress these demands exceed statutory cooperation duties. Patients are responsible for filing timely applications, not for managing appointment slots. Those affected should document their applications and appeal any unjustified benefit terminations.

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For workers already on sick leave, the current rules remain unchanged: employees must report incapacity on the first day, and present a doctor’s certificate by the fourth calendar day at the latest – though employers can demand it sooner. Paid sick leave runs six weeks per illness from the employer, followed by health insurance payments equalling 70% of gross pay (capped at 90% of net). If a worker is unable to work longer than six weeks within a year, a voluntary return-to-work management process (BEM) must be offered.

All this unfolds against a dire staffing shortage. The German Nursing Council (Deutscher Pflegerat) warns that up to 500,000 positions in hospital and elderly care could go unfilled by 2034. Already, roughly 115,000 posts are vacant, while the number of people needing care hit six million in 2026. The DGB union federation has denounced the PNOG as a pure austerity programme that offloads costs onto patients and staff. Critics fear the mounting pressure will push up sickness rates further – a pattern already visible in Switzerland, where stressful working conditions have driven absenteeism sharply higher, alongside steep economic losses from presenteeism.