Travel Time Counts as Work: German Courts Reshape Holiday and Employment Obligations
18.06.2026 - 04:22:29 | boerse-global.de
The European Court of Justice dropped a ruling in October 2025 that forces a rethink: when an employee drives a company car from a base depot to a customer site, and the employer controls the route, every minute behind the wheel is working time. The decision affects not just pay but rest periods, and German firms are now scrambling to adjust their travel policies.
That change is one of several legal shifts that have made holiday management and employer duties far more treacherous. The Bundesarbeitsgericht (BAG) issued a decision in June 2025 — case number 9 AZR 104/24 — that hollows out blanket settlement clauses on vacation claims. A settlement only holds water if it resolves a genuine, disputed question. If a worker was continuously on sick leave and a settlement simply confirms “vacation in kind,” the deal is void.
Workers cannot waive statutory minimum leave while still employed. Only after a termination notice can they voluntarily forgo compensation for unused days. The BAG ruling sharpens the transparency requirements around any such agreement.
The Information Duty That Never Sleeps
Since 2019, employers have been required to explicitly prod employees to take their leave well before it would expire. Skip that reminder, and the entitlement does not disappear — it rolls over and, upon termination, must be paid out in cash. The practical advice from labour-law experts: send a written nudge after the summer holidays and at the very start of the fourth quarter. Keep proof of every reminder. Only then does the statute of limitations actually start running.
Leave-payout claims are inheritable. The ECJ already settled that in 2014, and German courts have consistently applied the principle. Families can step into the deceased worker’s shoes and demand payment for accrued but untaken leave.
A separate warning comes from the Landesarbeitsgericht Köln. In January 2026, the court ruled that knowingly submitting false statements in a legal proceeding can justify an extraordinary dismissal. The attempted procedural fraud destroys the trust relationship, regardless of how the underlying case eventually turns out.
Works Council Agreements Under the Microscope
Formal deficits also carry heavy consequences. In January 2026, the BAG struck down a works council agreement because the council had not passed a proper resolution to adopt it — even though the council chair had signed the document. The Landesarbeitsgericht Thüringen followed in March 2026 by tossing out blanket rules that limited consecutive vacation to two weeks. Those rules, the court held, violate the Bundesurlaubsgesetz (Federal Holiday Act).
Taken together, the rulings require employers to audit their holiday-management processes, travel-time classifications and works council formalities. A missed reminder, a sloppy settlement or an improperly ratified agreement can each trigger costly liability.
