Limitation period for claims for compensation in lieu of annual leave:

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A huge sigh of relief: following the latest ruling by the Federal Labour Court (BAG), employers can assume that claims for compensation in lieu of holiday entitlement relating to the period prior to 2018 are time-barred.

Following a ruling by the European Court of Justice (ECJ) in November 2018, in which it clarified that holiday entitlement not taken by an employee during the holiday year only lapses if the employer has notified the employee in good time of this and of the impending lapse, and has enabled the employee to actually take the leave, it was unclear how leave and compensation claims arising from the period prior to this judgement – so-called ‘old cases’ – should be assessed. 

The Federal Labour Court (BAG) has now clarified that claims for payment arising from outstanding holiday entitlements – so-called holiday pay claims – are generally subject to a three-year limitation period, irrespective of whether the employer has fulfilled its duty to cooperate. For historical cases, this period begins at the end of 2018 and thus after the ECJ judgement was handed down.

Read our article on this subject in the online edition of the latest issue of Deutscher AnwaltSpiegel:

Read the article

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