Does the German Minimum Wage Act mean new rules for remuneration for on-call times?
Section 1(1) of the German Minimum Wage Act (Mindestlohngesetzes – “MiLoG” ) which applies since 1 January 2015, means that employees are legally entitled to payment of a minimum wage by their employer. According to sentence 1 of Section 1(2) of the MiLoG, the gross minimum hourly wage is EUR 8.50. Since the MiLoG is very recent legislation, there has hardly been any assessment of it to date by the courts.
One of the first decisions on the German Minimum Wage Act
One of the first judgements on the German Minimum Wage Act was handed down by the Aachen Labour Court on 21 April 2015 with respect to on-call times (Case No. 1 Ca 448/15h) for emergency services. In the court’s assessment, the remuneration rules in the Collective Bargaining Agreement for Public Service Employees in the Area of Administration (Tarifvertrag für den öffentlichen Dienst-Verwaltung – TVöD-V) regarding the on-call times of emergency services still comply with relevant laws even though the MiLoG has come into force. The Aachen Labour Court is implicitly making important clarifications with respect to the mechanisms of the German Minimum Wage Act.
Demand for additional remuneration for on-call services
In the case ruled on by the Aachen Labour Court, a worker employed by the emergency services whose (gross) monthly remuneration in accordance with the applicable collective bargaining agreement was EUR 2,680.31 plus allowances for weekly working time of 39 hours sought additional remuneration for on-call times with reference to the MiLoG. He argued that according to the collective bargaining agreement, weekly working hours including on-call times could be up to 48 hours per week. He said that according to the provisions in the collective bargaining agreement, he was only paid for a working time of 39 hours and not for on-call times. Due to the MiLoG being into force on 1 January 2015, the plaintiff argued that he should receive an additional EUR 8.50 (gross) per hour for on-call times.
Claim rejected by the Aachen Labour Court
The Aachen Labour Court rightfully dismissed the action. It first of all pointed out in the grounds of its decision that the applicable collective bargaining agreement did not state that on-calls times are not reimbursed. On the contrary: the collective bargaining agreement contained a system of provisions, according to which the plaintiff was already paid, without taking any extra pay into consideration, a gross amount of EUR 2,680.31 as his basic salary. In return, the plaintiff in principle had to work 39 hours per week and a maximum of 48 hours a week taking on-call times into consideration. This was both permissible and unproblematic even in light of the German Minimum Wage Act because even a collective bargaining agreement which exhausted the maximum permissible working time in accordance with the German Working Hours Act (Arbeitszeitgesetz – ArbZG) of 48 hours per week and provided for a calculated gross remuneration of EUR 8.50 per hour was compatible with the German Minimum Wage Act. If this was applied to the plaintiff’s remuneration according to the Collective Bargaining Agreement for Public Service Workers in the Area of Administration, a gross hourly wage of at least EUR 12.84 resulted, which by far exceeded the requirements of the German Minimum Wage Act.
What does this mean in practice?
This ruling therefore implicitly confirms that the statutory requirement of a minimum gross wage of EUR 8.50 “per hour of time” is merely the statutory regulation of a calculation factor. This is particularly important for the remuneration of overtime because the consequence of this assessment is that overtime does not also have to be remunerated with a gross amount of EUR 8.50 per hour in addition to a basic salary exceeding the minimum wage as long it is covered arithmetically by the basic salary on the basis of a calculation factor of EUR 8.50 per hour of time.
The Aachen Labour Court expressly did not address the issue of whether on-call times are in fact working hours which must be remunerated. In this respect, the findings of the German Federal Labour Court in its judgement of 19 November 2014 (5 AZR 1101/12) on the minimum wage in accordance with Section 2 of the Regulations on Mandatory Working Conditions for the Nursing Care Sector (Verordnung über zwingende Arbeitsbedingungen für die Pflegebranche – PflegeArbbV) of 15 July 2010 would have to be applied. Accordingly, working time which must be remunerated not only includes hours worked in full, but also on-duty hours and on-call times. Although the German Federal Labour Court stated that a lower wage can be determined for such on-duty hours or on-call times, which is lower than the wage for hours worked in full, the legislator did not make use of this possibility in the nursing care sector. Therefore employment contracts which provide for a wage for on-call services in the nursing care sector which is lower than the minimum wage pursuant to Section 2 of the Regulations on Mandatory Working Conditions for the Nursing Care Sector are invalid. This reasoning will have to be applied to the German Minimum Wage Act, with the result that employment contracts which provide for a lower wage for on-duty hours and on-call times are likewise invalid because the legislator has not provided for any lower wage for such hours in the German Minimum Wage Act.
Recommended reading: On working hours which must be remunerated cf. Mückl, in Mückl/Pötters/Krause, Das Mindestlohngesetz in der betrieblichen Praxis (The German Minimum Wage Act in Operational Practice), para. 391 ff., on the qualification of the requirement to pay a minimum wage “per hour of time” as an arithmetic unit/calculation factor, cf. loc. cit. at para. 340 ff., www.rws-verlag.de/03820.
Any questions? Please contact: Dr. Patrick Mückl
Practice Group: Employment & Pensions