Germany’s Tiniest Employers Win Five-Year Exemption as Mandatory Digital Time-Tracking Nears
Veröffentlicht: 18.07.2026 um 02:22 Uhr, Redaktion boerse-global.de
Under a draft reform of the country’s Working Hours Act (Arbeitszeitgesetz) that is set to take effect at the start of 2027, companies with ten or fewer employees will be permanently exempt from the obligation to clock in and out electronically. They may keep records on paper or in spreadsheets instead. For micro?enterprises with fewer than 50 staff, the rule will still apply — but they get up to five years to comply.
The legislation, expected to come into force no earlier than January 2027, follows a 2022 landmark ruling by the Federal Labour Court (Bundesarbeitsgericht). The court held that employers were already legally required to operate a time?recording system, but left the method open. Now the government wants to make digital documentation mandatory: companies must record start time, end time, and daily duration on the same day and keep those records for two years. The duty rests with the employer, though employees can be tasked with the actual logging.
Speaking of employer obligations – the duty to record working hours is just one part of a larger compliance picture. Many UK businesses risk significant fines when essential health and safety documents are missing. A free toolkit provides ready?to?use risk assessments and checklists that you can implement immediately. Download the free Health & Safety Toolkit
Senior executives (“leitende Angestellte”) are completely excluded from the new rules, and trust?based working time remains lawful — but it too must be fully documented.
Political Battle Over Flexibility Widens
Coalition partners are at odds over how much flexibility the law should grant. Labour Minister Bas wants to enable a shift from daily to weekly maximum working hours, primarily through collective bargaining agreements. In that model, weekly hours could exceed eight per day as long as the annual average stays below 48 hours.
Chancellor Merz signalled in July that he expects a draft in autumn that also opens flexibility to companies without a collective agreement — a point sharply pressed by business groups and the Mittelstand commissioner, Connemann. They argue that millions of workers in non?tariff firms would otherwise be locked out of any relaxation. The German Trade Union Federation (DGB) opposes any extension of the daily limit, citing surveys that show a clear majority of employees favour capping the workday at eight hours.
Court Rulings Tighten the Screws
Two recent judicial decisions add to the pressure. In September 2022 the Federal Labour Court established the employer’s duty to have a recording system. In October 2025 the European Court of Justice ruled that mandatory group journeys from a base depot to changing work sites count as full working time — a headache for the trades and field?service sectors, compounded by the fact that the minimum wage rose to €13.90 an hour in January 2026.
Deliberately falsifying time records remains a ground for immediate dismissal, courts have confirmed. Each case is judged individually, taking into account the length of employment and the amount of damage.
As German employers prepare for new time?recording rules, UK businesses can already get ahead of their own compliance requirements. The free Health & Safety Toolkit covers all key UK regulations, helping you stay compliant effortlessly. Join over 37,000 UK companies that already trust it. Get your free Health & Safety Toolkit now
Changes to Rest Periods and Sunday Work
The reform also tightens the rules on rest breaks. A reduction of the statutory rest period will only be permitted if it is compensated immediately. Starting in January 2027, Sunday work will be expanded to include more facilities — libraries and bakeries are explicitly named.
Meanwhile, the reference period for the weekly maximum of 48 hours is to be shortened from six months to four. The government hopes the phased digital mandate will modernise time?keeping without overwhelming the smallest players, but the political wrangling over who gets to work longer — and how — is far from over.
Disclaimer zu unseren Artikeln: Keine Anlageberatung, keine Kauf oder Verkaufsempfehlung. Angaben zu Kursen, Unternehmen und Märkten ohne Gewähr; Änderungen jederzeit möglich. Börsengeschäfte können zu hohen Verlusten führen. Unsere Beiträge werden ganz oder teilweise automatisiert mit Unterstützung von AI erstellt und geprüft.
