Latest Developments on COVID-19 and German Employment Law

The legal situation for German employers regarding COVID-19 is still extremely dynamic. The past few weeks (again) brought significant changes in both statutory law and case law, for example regarding the compulsory offer of COVID-19 rapid testing at the workplace. As such, we are pleased to shed light on the latest developments and current hot topics from the German employment law angle.

I. Statutory regulations

To fight the Coronavirus pandemic, Germany has introduced a number of new regulations. Employers are expected to contribute more to infection control. As a result, new regulations and obligations are coming into force for employers.

Employers must provide COVID-19-testing

Rapid tests play an increasingly important role in fighting the pandemic. Now that the government has significantly expanded the testing strategy, employers are also required to offer COVID-19 rapid testing to their employees, unless they work from home. The corona occupational health and safety ordinance has been amended accordingly and at the same time extended until 30 June 2021. Employers are now required to offer at least one test a week for every employee and organise the testing. Violations can be fined at up to EUR 30,000.00. Employees are obliged to immediately isolate themselves after a positive rapid test, until the result of a regular PCR test is available.

Is testing time to be qualified as working time?

Many employers face the question whether the time during which the rapid test is carried out must be considered paid working time. This question is still hotly debated. The currently prevailing legal opinion is that the testing time does not constitute payable working time, as the statutory regulations only oblige the employer to offer tests, but not the employee to accept this offer and actually get tested. Hence, tests are considered voluntary for the employee. On the other hand, if the employer instructs employees to get tested – whereas the legal permissibility of such instruction is also still hotly debated –  the time taken for this test will be classified as working time.

Compensation entitlement expanded to precautionary quarantine

The latest amendment of the Infection Protection Act extends the claim for compensation to the case of precautionary quarantine without prior official order. The Infection Protection Act provides for an employee’s right to compensation from the state for loss of income due to a quarantine order. The employer must pay the employee salary in the amount of the compensation and can then reclaim this from the state. The amendment of the law is based on the increasing number of cases in which employees had to isolate themselves according to federal state law due to a positive COVID-19 rapid test and no official quarantine orders were issued for the period between rapid and PCR test. Employees may now receive compensation for loss of income – even without an official order for quarantine – if at the time of the precautionary isolation, an order for quarantine could already have been issued. In case of a positive COVID-19 rapid test, the prerequisites for ordering quarantine should usually be fulfilled.

The amendment generally clarifies the requirements for compensation under the Infection Protection Act for the period between a positive rapid test and the result from a PCR test. However, it remains to be seen how the authorities that decide on the compensation will handle upcoming claims, since there is some room for discretion according to the legal regulation.

II. Case law

 In addition to the fast-changing statutory regulations, courts are increasingly dealing with Corona-related questions and their rulings constitute important practical guidelines for employers.

Reduction of leave in case of “short-time work zero”

Many employees are still working short-time in Germany, as the pandemic continues. The instrument of short-time work has never been used to such large extent as in this crisis. Therefore, there are still practical questions that need to be answered, such as the question on the impact of short-time work on leave entitlements.

The latest ruling of the District Labour Court of Düsseldorf sheds light to the question of how leave entitlements are to be calculated in periods of “short-time work zero”, i.e. when the employee’s obligation to work is temporarily completely suspended. In the case in hand, the employee had been working part-time in a restaurant. Due to the part-time employment, the employee’s leave entitlement amounted to 14 days per calendar year. In 2020, the employee had been affected by “short-time work zero”, i.e. her working hours had been reduced to zero for a couple of months due to statutory closures of restaurants in Germany. Despite this short-time work phase, the employee claimed her full leave entitlement for 2020.

However, according to the court, the annual leave entitlement is to be reduced by 1/12 for each full month of “short-time work zero”. The recreational aspect of the leave can only be served if the employee is obligated to work in the first place. Thus, if the obligation to work is completely suspended due to short-time work, the leave entitlement is reduced accordingly. Employees affected by “short-time work zero” are to be treated as temporary part-time employees whose leave is cut pro rata. The ruling of the District Labour Court is not yet final and could still be overturned by the next instance, but at least gives employers grounds to argue that holiday entitlements are to be adjusted due to short-time work.

Employer bears the operational risk even during the pandemic

According to another ruling of the District Labour Court of Düsseldorf, the pandemic is part of the operational risk to be borne by the employer. Employees, therefore, are still entitled to be paid for periods where the company was shut down due to the Coronavirus.

The employee in question was employed in a gambling hall which was closed due to the pandemic in March 2020. Due to her retirement in May 2020, the employee did not receive any short-time work allowance. The question to be clarified in court was whether the Coronavirus-related closure was part of the employee’s risk or whether the employer bears the risk and therefore owes remuneration to the employee even though he was not allowed to operate his gambling hall.

The court ruled that the employer bears the risk resulting from the pandemic and, therefore, owes remuneration to the employee although he was not allowed to operate his business. According to the law, the employer bears the operational risk, which means he still owes remuneration even if the business is bothered by external circumstances. This includes natural disasters, earthquakes, floods or extreme weather conditions as well as the current pandemic. It does not matter if the pandemic-related shutdown affects a whole industry, is locally limited or affects the whole country. Accordingly, in the case at hand, the employer was obliged to pay remuneration despite the shutdown of his company. Usually, state benefits, in particular the short-time work allowance, take effect in such cases, but as the employee in question did not receive such allowance, the payment duty remained on the employer.

Remuneration entitlement in case of employer-ordered quarantine

Latest case law clarified that the employer is only released from the obligation to pay remuneration if the health authority ordered quarantine of individual employees. In the present case, the employer and the employee were in conflict about the remuneration after the employer had ordered the employee to stay at home for two weeks after returning from vacation.

The employee had been on vacation in Austria at the beginning of the Coronavirus pandemic. After the employee’s arrival, Austria was declared a risk area due to the high number of Coronavirus infections. Thereupon, the employer requested the employee to stay at home for two weeks after his return from Austria. However, the employer refused to pay remuneration for these two weeks.

The court ruled that an employer is only released from the obligation to pay remuneration if the quarantine was ordered by an authority. If the employer orders quarantine independently, he still owes remuneration for this period. Since there was no quarantine order from the authorities in the present case, the employee was successful in court when claiming remuneration. Employers should, therefore, not act too rashly. In many cases, an obligation to isolate is already prescribed by law. In this case employers are reimbursed through state benefits. However, if there is neither a legal obligation nor an official order, the employer remains obliged to pay remuneration.

In summary, the current developments in both statutory and case law are as dynamic as the pandemic itself. Employers nonetheless need to stay updated to avoid the risk of committing administrative offences.