Germany’s Clock-In Revolution: Electronic Time Recording Becomes Law in Phased Rollout
Veröffentlicht: 07.07.2026 um 18:23 Uhr, Redaktion boerse-global.de
Employers across Germany are facing a digital shift in how they track working hours. A reform package announced on 2 July 2026 and accompanying draft legislation to amend the Arbeitszeitgesetz (Working Hours Act) mandate that from now on, start, end and duration of daily work must be recorded electronically. While trusts?based flexible work arrangements remain permissible, they no longer exempt the employer from the duty to monitor.
The phased transition gives most businesses one year to comply, while companies with fewer than 250 staff receive two years. Micro?enterprises with under 50 employees get five years. Very small firms with up to ten workers, and certain collective?bargaining constellations, can qualify for exemptions.
Part?Time Workers Win Equal Treatment on Overtime Premiums
A landmark decision by the Federal Labour Court (Bundesarbeitsgericht, case 5 AZR 118/23) on 26 November 2025 has strengthened the rights of part?time employees. The judges ruled that absolute threshold values – benchmarks tied to full?time hours – violate the ban on discrimination. In one case, a care?worker in part?time received back?pay of overtime premiums plus €250 compensation for discrimination. Going forward, thresholds must be calculated proportionally: each individual’s weekly hours are set in relation to the full?time equivalent.
What Counts as Overtime – and What Doesn’t?
The reform package clarifies a distinction that often causes confusion. Overtime (Überstunden) refers to hours worked beyond the individually agreed contractual limit. Employers must pay for overtime only if they explicitly ordered, approved or tolerated it. Pflaum – flat?rate compensation clauses in contracts survive legal scrutiny only if they specify a concrete maximum number of hours.
Extra work (Mehrarbeit) , by contrast, is time worked beyond the statutory daily ceiling – normally eight hours per working day, or 48 per week. Up to ten hours daily is allowed provided compensatory time off is granted within a set period. Under the draft law, that compensation window shrinks from six to four months. Violations can trigger fines as high as €30,000.
New Rules for High?Earners and Notice Protection
Employees earning above the social?security contribution ceiling – currently around €8,450 gross a month – generally have no automatic claim to overtime pay unless agreed otherwise. The reform goes further: from 1 January 2027, dismissal protection will be loosened for workers with an annual salary of about €177,450 or more. Meanwhile, the lump?sum tax on mini?jobs rises from 2% to 5%, and premiums for Sunday and public?holiday work remain tax?free up to an hourly wage of €75.
Sickness Absence: Tougher Certification Ahead
Sick?leave data from the BKK umbrella association shows a stable absentee rate of 6.1% in 2025. The main cost drivers are not short infections but long?term absences due to musculoskeletal disorders or mental illness. Mental health conditions account for only 5.4% of cases yet average more than five weeks off.
Despite these statistics, the coalition plans to scrap telephone sick notes – already an option employers can request today – and make a medical certificate mandatory from day one. Legal experts note that employers already have this right, but enshrining it in law is likely to increase pressure on doctor’s surgeries. The National Association of Statutory Health Insurance Physicians estimates up to 30 million extra consultations each year.
