Reducing vacation time during parental leave: What you need to know

Can an employer reduce vacation time during parental leave? And if so, how is the reduction calculated? And is it always reasonable? An expert explains the legal situation.

This article is part of the special topic of vacation planning in the workplace.

Can an employer reduce vacation time during parental leave ? "Yes – that's allowed ," explains employment law specialist Julia Kleymann . "According to Section 17 Paragraph 1 Sentence 1 of the Federal Parental Allowance and Parental Leave Act (BEEG), the employer may reduce annual leave by one-twelfth for each full calendar month of parental leave ."

The Federal Labour Court has confirmed this (Case No. 9 AZR 362/18 ). It clarified that this regulation is also compatible with European law. The reduction is an adjustment of the vacation entitlement to the work obligation that is suspended during parental leave.

Important: The employer may only reduce annual leave for each full calendar month of parental leave. This means that an employee who takes parental leave for two months in the middle of a month may not have leave deducted for either the beginning or end month. Only the intervening full calendar month of absence may be reduced by one-twelfth (Federal Labor Court, Case No. 9 AZR 197/10 → Read more here!)

By the way: Vacation days not taken before the start of parental leave do not expire. According to Section 17 Paragraph 2 of the Federal Parental Allowance and Parental Leave Act (BEEG), these remaining vacation days can be taken in the current or the following vacation year.

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When must the employer notify the reduction?

The reduction in vacation days doesn't happen automatically . The employer must provide a clear statement indicating their intention to reduce the vacation entitlement. This notification must be received by the employee and can be given before, during, or after parental leave. However, it's crucial that the statement is only issued after the employee has officially notified the employer of their intention to take parental leave. This notification can be in writing or implicit. An implicit notification occurs, for example, when the reduced vacation days are clearly visible in the payslip or vacation overview.

How is the reduction calculated? 

The legal formula is simple: For each full month of parental leave, annual leave is reduced by one-twelfth . For example: If an employee has 24 vacation days per year and takes eight full months of parental leave, their entitlement is reduced by 8/12 of 24 = 16 days. This leaves eight vacation days.

practical tip

Employers should consider these points: 

• Documentation: The notification of parental leave should be included in the personnel file be filed.
  
  
• Communicate the reduction clearly: As clearly, comprehensibly and written to explain. 
  
  
• Make access verifiable: For example, by Registered mail or personal handover with confirmation of receipt. 
  
  
• In time informieren: Discuss the reduced vacation entitlement early on to avoid misunderstandings. 
  
  
• Economically weigh up: Is the reduction strategically sensible?

"From an economic perspective, reducing vacation entitlements should always be carefully considered ," advises the employment lawyer. "While the reduction is legally permissible, it is not mandatory . Employers should examine whether a reduction is actually strategically sound. Especially in times of skilled labor shortages, retaining qualified employees is a crucial success factor. People are the most important resource of any successful company – far more important than processes or short-term cost savings. An appreciative personnel policy that strengthens trust and loyalty can be significantly more profitable in the long run than a formal reduction of individual entitlements. A conscious decision to forgo the reduction or a more accommodating arrangement can therefore send a strong signal of appreciation and boost the motivation to return to work after parental leave. In the long term, this can lead to lower employee turnover, higher productivity, and a positive employer image – economic advantages that often outweigh any short-term savings."

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