No Waiver of Minimum Leave – Not Even in a Court Settlement (Federal Labour Court, 9 AZR 104/24)

In its judgment of 3 June 2025 (9 AZR 104/24), the Federal Labour Court (Bundesarbeitsgericht, BAG) made clear that statutory minimum leave cannot be validly waived during an existing employment relationship. This applies even if the waiver forms part of a court settlement on the termination of the employment relationship.

The starting point of the decision is § 13(1) sentence 3 of the German Federal Leave Act (BUrlG), according to which the provisions on minimum leave may not be deviated from to the detriment of the employee. A passage in the settlement stating that leave entitlements have been "granted in kind" is not sufficient if the leave could in fact not be taken due to illness. In that case, the leave entitlement is converted into a claim for compensation (Abgeltungsanspruch) upon termination of the employment relationship.

The BAG emphasised that neither the procedural situation nor the fact that the termination of the employment relationship was already a certainty changes anything about this mandatory nature. A settlement of facts (Tatsachenvergleich) must remove an uncertainty – in the case in dispute, however, the leave could not be taken at all, so that the outstanding leave entitlements could not be "set to zero" in the court settlement.

In settlements and termination agreements, employers should distinguish very carefully between statutory minimum leave and additional leave and should always compensate minimum leave entitlements expressly and in a legally secure manner.