Employment Law: Statutory Minimum Leave is Inviolable – Even in Court Settlements

The Federal Labour Court makes it clear: Statutory minimum leave cannot be waived during an employment relationship – not even in court.

This article is presented by BRG Rechtsanwälte, Berlin, Germany – Your Employment Law Attorney in Germany

The Case

A operations manager had been on continuous sick leave since January 2023 and was unable to take his annual leave. In March 2023, he reached an agreement with his employer in court: termination on April 30 in exchange for a €10,000 severance payment. The crucial catch: The settlement stated “leave entitlements have been granted in kind” – a wording that excluded financial compensation.

After the termination, the employee nevertheless demanded payment for his seven days of leave – approximately €1,615.

The Verdict: Employee Wins

The Federal Labour Court ruled in his favor. The reasoning is unequivocal:

Statutory minimum leave is inviolable. It cannot be waived during an existing employment relationship, neither through renunciation nor through a court settlement – not even when it is already clear that the leave can no longer be taken due to illness.

The agreement violates Section 13(1), sentence 3 of the Federal Leave Act (BUrlG), which prohibits deviations from leave regulations to the detriment of the employee. Furthermore, EU law protects paid minimum annual leave: it may only be replaced by monetary compensation upon termination of the employment relationship.

The employer argued in vain that the employee had agreed to the settlement. The Federal Labour Court countered: no one may rely on an obviously unlawful provision – not even when it was agreed upon jointly in court.

The Consequence: Upon termination of employment, unused statutory minimum leave must always be paid out. Waiving this right is simply invalid.

Federal Labour Court, Judgment of June 3, 2025, Case No. 9 AZR 104/24