Furlough/reducing working hours to “zero” (Kurzarbeit “Null”) also reduces vacation entitlement.

 Judgment of the Regional Labor Court of Düsseldorf dated March 12, 2021 (Ref.: 6 Sa 824/20)

Furlough/reducing working hours to "zero" (Kurzarbeit “Null”) also reduces vacation entitlement

The Regional Labor Court of Düsseldorf has decided that short-time work "zero" reduces the vacation entitlement in the same way as part-time work does. Entitlement to leave for reasons of recuperation required actual work.

As a result of the Corona pandemic, many employees are working with reduced working hours. This also has an impact on their vacation entitlement. During the period of furlough/ so-called reducing working hours to “zero” (Kurzarbeit “Null”), the employee is not entitled to vacation. This was decided by the Regional Labor Court of Düsseldorf in a ruling dated March 12, 2021 (Ref.: 6 Sa 824/20).

The plaintiff was a part-time saleswoman at a bakery. Due to Corona, she had been on furlough/reducing working hours to “zero” (Kurzarbeit “Null”) repeatedly.

Saleswoman Insists on Full Vacation Entitlement

Her employer had reduced her vacation entitlement for 2020 on a pro rata basis. The employee did not consent to this. She insisted on her full vacation entitlement. She claimed that ultimately, the short-time work was not at her request, but in the interest of the employer. Moreover, as an employee, she was subject to reporting obligations during short-time work and could not freely plan her time.

Courts Deny Claim

The courts did not follow her reasoning. Like the Labor Court of Essen in the first instance, the Regional Labor Court of Düsseldorf also dismissed the claim in the appeal proceedings. In the opinion of the Regional Labor Court, the plaintiff did not obtain any vacation entitlement during the period of “zero” working hours.

The Regional Labor Court argued that the purpose of vacation was the employee’s relaxation. This would require an obligation to perform work, which does not exist during “zero” working hours. Furthermore, the purpose of furlough/reducing working hours to “zero” (Kurzarbeit “Null”) is to maintain the job, and it therefore serves the employees’ interests.

However, things get complicated when it comes to calculating the number of vacation days under consideration of furlough:

For time periods of short-time work, the vacation entitlement is automatically reduced based on the formula:
Total vacation entitlement for the calendar year x number of days with work obligation / 312 days.

As the total vacation entitlement for the calendar year, the Regional Labor Court bases its formula on the vacation entitlement for employees with six working days, obviously because the statutory vacation entitlement of 24 days is calculated on the basis of a six-day week or because full-time employees in bakeries work 6 days per week. Correspondingly, at the end of the formula it also divides by 6 days x 52 weeks = 312 maximum possible working days.

The Regional Labor Court also calculates the additional leave granted voluntarily into the employee’s total leave entitlement, provided that special regulations do not exceptionally apply to this in the case of short-time work “zero”. The result may have to be rounded up (from 0.5) (Art. 5 (2) German Federal Holiday Act).

No Violation of EU Law

The Regional Labor Court regards its decision as being in accordance with European law and the case law of the CJEU, pursuant to which even full-time employees are to be viewed as “temporary part-time employees” during short-time work, meaning that their vacation entitlement is reduced pro rata temporis.

No Legal Effect

The Regional Labor Court has admitted the appeal.

Open Questions

However, according to the formula and the reference to the decision of the CJEU, leave could also be reduced if the employee was not working in short-time work zero, but short-time work in the form of a reduction in the number of working days per week to more than zero. The Regional Labor Court did not explicitly comment on this because it was not important in the case at hand. Nevertheless, the analogy drawn by the Regional Labor Court to “other part-time situations” speaks in favor of this.

It is legally controversial whether short-time work also reduces vacation entitlement on a pro rata basis. The Regional Labor Court in Düsseldorf has allowed an appeal, so the question will ultimately have to be clarified by the Federal Labor Court. To be on the safe side, we recommend that employers contractually regulate the reduction of vacation entitlement in the event of short-time work “zero”.

In its decision, the Regional Labor Court assumes that short-time work has been “agreed on”. If short-time work has not been effectively negotiated with the employee or legally introduced in any other way, but has been unilaterally imposed on the employee, for example, a vacation reduction cannot be considered, and there is a risk of completely different legal consequences.