When the employment relationship ends, any unused vacation that cannot be taken before the end date must be paid out in cash. This is the Urlaubsabgeltung under § 7(4) BUrlG, and it is the one situation where vacation is paid rather than taken as time off.
How the payout is calculated
The payout is calculated on the basis of your average gross daily salary over the 13 weeks (or three months) immediately before the end of employment, excluding overtime. The formula:
Daily rate = (gross salary over the last 13 weeks) / (working days in those 13 weeks)
Payout = daily rate × unused vacation days
Variable elements — bonuses, commissions — are typically included if they were paid in the reference period. Reimbursable expenses are not.
Both statutory and contractual vacation
The payout right covers both the statutory minimum and any contractual vacation you have earned, unless your contract specifically distinguishes between the two and excludes contractual vacation from the payout. Such exclusion clauses exist but are often poorly drafted and unenforceable.
What if the employer says the balance is zero?
This is the most common dispute we see. Three lines of defence:
- The employer’s notification duty. Under the ECJ’s Max-Planck judgment (C-684/16), vacation does not lapse unless the employer has clearly and in good time informed the employee how much vacation remains and warned that it will expire if not taken. The German courts apply this rigorously. Most employers do not do it properly. If you have not received such notifications, untaken vacation from previous years is often still claimable.
- Inability to take. If you were prevented from taking vacation due to illness, your statutory vacation rolls over (up to 15 months after the end of the leave year for sick employees, BAG 7.8.2012, 9 AZR 353/10).
- Operational reasons. If the employer refused to grant vacation in time, the vacation rolls forward.
Garden leave and vacation
If your employer placed you on garden leave (Freistellung) at the end of your employment, the question arises whether vacation was “taken” during the Freistellung or remains due as payout. The answer depends entirely on the wording. A clean Freistellung order should say expressly whether it is “unter Anrechnung der Urlaubsansprüche” (counted against vacation) or “ohne Anrechnung” (not counted). Ambiguous wording often resolves in the employee’s favour.
How to claim
Write to the employer with the calculation, including the days claimed and the daily rate. Most employers pay without dispute once the figures are presented clearly. If not, the claim falls under the Ausschlussfrist (three months in most contracts) and the labor court can grant payment quickly.
How to calculate the daily rate
The payout is based on the average gross daily salary over the 13 weeks immediately before the end of employment. Specifically:
- Sum all regular gross salary received in the last 13 weeks (excluding overtime, but including regular bonuses and allowances paid in the period).
- Divide by the number of working days in those 13 weeks for your schedule.
- Multiply by the unused vacation balance.
Example: €6,500/month, 5-day week, 8 unused vacation days. 13 weeks of pay = ~€19,500. Working days = 65. Daily rate = €300. Payout = €2,400 gross.
Garden leave and Anrechnung
Where you are placed on paid release (Freistellung) for the end of the notice period, the agreement should expressly state whether the vacation is “taken” during the Freistellung (“unter Anrechnung der Urlaubsansprüche”) or remains payable. An ambiguous Freistellung is generally read in the employee’s favour — meaning the vacation is not taken and remains payable on top.
How long the claim survives
The payout claim is subject to your contract’s Ausschlussfrist (typically 3 months from end of employment) and to the general three-year statute of limitations as a fallback. Assert the claim in writing within the first six weeks after exit to be safe.