Three misunderstandings shape how people in Germany deal with vacation entitlement during illness and with being sick during vacation: first, many employees believe that vacation is automatically forfeited as soon as they are ill for a longer period. Second, there is a widespread assumption that there is no vacation entitlement without continued pay. Third, those affected assume that if they are dismissed during a long illness, all remaining vacation is lost. All three assumptions are wrong.
The legal framework for vacation entitlement after a long illness, while receiving sick pay, after the 78-week exhaustion of sick pay or on dismissal is complex. This article explains precisely what employees and employers in Germany need to know: when does vacation entitlement accrue despite illness? Which deadlines apply after six weeks or 78 weeks? What does current case law mean for people on long-term sick leave? And which documentation duties do employers have?
Summary: the 7 key points on vacation entitlement during illness in Germany
- Vacation entitlement continues to accrue in full during incapacity for work, regardless of continued pay or sick pay.
- In the case of long-term illness, statutory vacation is forfeited at the earliest 15 months after the end of the vacation year, i.e. on 31 March of the year after next.
- The Federal Labor Court ruling of 15 July 2025 confirms: employment contracts can override the 15-month rule and protect vacation during illness without a time limit.
- If you fall ill during your vacation, you get the sick days back, provided you have a doctor's certificate of incapacity for work from the first day and have informed your employer without delay.
- After 78 weeks of illness (exhaustion of sick pay), vacation entitlement remains fully intact; the deadline only concerns sick pay.
- Employers must inform employees in good time and in writing about open vacation days, forfeiture deadlines and the request to take vacation; otherwise no vacation is forfeited.
- On dismissal during illness, payment in lieu of vacation is based on the 13-week average; claims must be asserted in writing immediately.
Does vacation entitlement accrue at all during illness?
Vacation entitlement continues to accrue in full during incapacity for work. The Federal Vacation Act (Bundesurlaubsgesetz, BUrlG) treats employees on sick leave and working employees equally when calculating annual vacation. For each full month of employment, 1/12 of the annual vacation accrues, regardless of whether the person is actually working or absent due to illness.
What is the difference between statutory minimum vacation and additional contractual vacation?
Statutory minimum vacation is 24 working days per year for a six-day week and 20 working days for a five-day week. This entitlement accrues without restriction during illness. Employment contracts or collective agreements often grant more vacation days than the statutory minimum. Different rules may apply to this additional contractual vacation, such as shorter forfeiture periods or stricter conditions for carrying it over to the following year.
In concrete terms: if you have 30 vacation days per year under your contract but only 20 days of statutory minimum vacation, you may lose the ten additional days earlier than the 20 statutory days in the event of a long illness. Statutory vacation entitlement, however, remains protected.
Sick during vacation in Germany: do I get my vacation days back?
If you fall ill during your vacation, you do not lose any vacation days for that period. The condition is that your incapacity for work is proven by a doctor's certificate. The sick days do not count as vacation.
Concrete steps if you are sick during vacation: first, you must inform your employer without delay about the illness. Second, you need a doctor's certificate of incapacity for work (Arbeitsunfähigkeitsbescheinigung, AU-Bescheinigung), and you need it from the first day of illness, not only from the fourth day as is otherwise usual. Third, the vacation days lost due to illness can be taken at a later date. They are credited back to your vacation account.
What applies if you fall ill on vacation abroad?
If you fall ill abroad, additional proof requirements apply. The certificate of incapacity for work must reach your employer as quickly as possible, for example by email or text message. At the same time, you must inform your health insurance fund about the incapacity for work and your whereabouts. Only if you inform them in good time do you keep your entitlement to continued pay during your stay abroad.
Remaining vacation during illness: carry-over, forfeiture and the 15-month rule
As a rule, vacation must be taken in the calendar year in which it accrues. Vacation not taken is forfeited on 31 December unless there are special reasons for carrying it over. Reasons for carry-over are urgent operational or personal reasons as well as incapacity for work. In these cases, forfeiture is postponed to 31 March of the following year.
When is vacation forfeited in the case of long-term illness?
A special rule applies to long-term illness: vacation entitlements can remain in place for up to 15 months after the end of the vacation year. This period begins after 31 December of the year in which the vacation accrued and ends on 31 March of the year after next.
An example illustrates the deadline logic: vacation entitlement from 2025 is forfeited at the latest on 31 March 2027 in the case of continuous incapacity for work, i.e. 15 months after 31 December 2025. The condition is that the person was continuously unable to work from 1 January 2025 to 31 March 2027. Interruptions due to fitness for work can accelerate forfeiture.
This rule only concerns vacation that accrued during the illness. If someone falls ill for the first time in March and the annual vacation had already fully accrued at the beginning of the year, this vacation is only forfeited after 15 months if the employer has fulfilled its duty to inform. If, however, the person is permanently ill from January onwards, the vacation only accrues during the illness and is forfeited after 15 months even without notice.
Vacation entitlement after a long illness: what does current case law say (BAG 2025)?
On 15 July 2025, the Federal Labor Court (Bundesarbeitsgericht, BAG) clarified (case no. 9 AZR 198/24): employment contracts can protect statutory minimum vacation better than the law does. If a contract explicitly states that statutory vacation is not forfeited after 15 months in the case of long-term illness, this entitlement remains in place until the employment relationship ends.
In the case at hand, the employment contract stipulated that statutory vacation entitlement continues to exist if incapacity for work due to illness lasts beyond the carry-over period. The BAG assessed this clause as a valid deviation in favor of the employee. Unlike statutory minimum standards, which may not be undercut, the law expressly allows more favorable contractual agreements.
What does the BAG case law mean for my employment contract?
This case law means employees should check their employment contracts. If there are clauses such as "Statutory vacation is not forfeited in the event of illness" or "Vacation entitlements remain in place indefinitely during incapacity for work", the 15-month rule does not apply. Employers who have agreed such provisions must keep all vacation accrued during the illness available until the end of the employment relationship.
Collective agreements can contain similar provisions. The specific wording is decisive. Blanket wording such as "The statutory provisions apply" does not offer extended protection. Only explicit agreements on non-forfeiture during illness create legal clarity.
Vacation entitlement during illness of more than 6 weeks: what applies once sick pay starts?
After six weeks of incapacity for work, continued pay by the employer under the Continued Remuneration Act (Entgeltfortzahlungsgesetz, EFZG) ends. From the seventh week, the health insurance fund pays sick pay (Krankengeld). Sick pay amounts to 70 percent of gross income, but no more than 90 percent of net pay. The switch from continued pay to sick pay has no effect on vacation entitlement.
Vacation entitlement and continued pay are legally separate claims. Annual vacation accrues regardless of whether pay comes from the employer or from the health insurance fund. Vacation entitlement continues to build up month by month while sick pay is being received.
Can I take vacation while receiving sick pay?
Only those who are fit for work can take vacation. In practice, it is not possible to take vacation while receiving sick pay because the incapacity for work continues. Only once you are fit for work again can you claim the vacation entitlement built up during the sick pay phase. The vacation days are retained and are only forfeited after the deadlines described above.
Vacation entitlement after 78 weeks of illness: what does "exhaustion of sick pay" mean for vacation?
The 78-week period describes the maximum period for receiving sick pay within three years for the same illness. After 78 weeks, sick pay ends (known in German as Aussteuerung). The person concerned must then apply for other social benefits such as unemployment benefit or a reduced earning capacity pension.
Exhaustion of sick pay does not change vacation entitlement. The employment relationship continues as long as there is no dismissal. Vacation entitlement as part of the employment relationship remains unaffected. The vacation days accrued over the entire period of illness can be taken after returning to work or paid out when the employment relationship ends.
What should employees do after 78 weeks of illness?
After 78 weeks of illness, employees should document their vacation balances. Employers are obliged to provide this information. If the employment contract contains favorable forfeiture rules, all vacation days are retained. Otherwise, the 15-month rule applies to the statutory minimum vacation. Contractual clauses on vacation forfeiture should be checked for validity. If anything is unclear, legal advice makes sense.
Vacation entitlement during illness without continued pay: what applies in the first 4 weeks?
New employees have no entitlement to continued pay in the event of illness during the first four weeks of employment. This waiting period is intended to protect employers from immediate continued pay costs if someone falls ill directly after being hired.
The lack of entitlement to continued pay does not mean that no vacation entitlement accrues. Vacation builds up pro rata from the first day of employment, regardless of the waiting period for continued pay. If you fall ill in the first four weeks, you still acquire 1/12 of the annual vacation for each full month.
Who pays during illness in the first 4 weeks?
Without continued pay from the employer, the statutory health insurance fund generally pays sick pay (Krankengeld) during this period, provided there is an entitlement to it. Under § 49 SGB V, sick pay is only suspended while employees receive wages. Vacation entitlement itself remains unaffected and can be taken later.
Vacation entitlement during probation and illness: how much vacation accrues and what happens on dismissal?
During the probationary period, vacation entitlement builds up pro rata. For each full month of employment, 1/12 of the annual vacation accrues. With 24 vacation days per year (six-day week), that corresponds to two days per month. Illness during the probationary period does not change this accrual.
If the employment relationship ends through dismissal during or after the probationary period, there is an entitlement to payment in lieu of the vacation days accrued up to that point. This rule also applies if the dismissal is given during a period of illness.
How is vacation entitlement calculated on dismissal during probation?
An example: someone starts on 1 February and is dismissed on 30 April while ill. With an annual entitlement of 20 vacation days (five-day week), 1.67 days accrue per month. After three full months (February, March, April), the entitlement is five vacation days. These must either be taken before the contract ends or paid out.
The probationary period is not automatically extended because of illness. Employer and employee can agree on an extension but are not obliged to do so. The vacation entitlement accrued during the probationary period is retained in any case.
Vacation entitlement on dismissal during illness: take the vacation or have it paid out?
If the employment relationship is terminated by dismissal during illness, vacation days not taken must be paid out if they can no longer be taken. Payment in lieu of vacation is always secondary to actually taking the vacation. Payment is only required if the remaining working time is too short or the employer refuses the vacation for operational reasons.
The amount of payment in lieu of vacation is calculated on the basis of average earnings in the last 13 weeks before the employment relationship ends. This is the gross salary for this period divided by the number of working days. If the person was on sick leave during this time, there are two calculation approaches: some courts use earnings before the illness began, others the income that would have been earned without the illness.
Which deadlines apply for claiming payment in lieu of vacation?
Many employment contracts contain exclusion clauses under which all claims must be asserted in writing within certain periods (often three months). These clauses also apply to payment in lieu of vacation. After a dismissal, you should therefore notify your employer of your claim to remaining vacation in writing immediately to preserve the deadlines.
The employer's perspective: duty to inform, documentation, typical mistakes
Employers have an active duty to inform employees about open vacation days and impending forfeiture. Without timely, clear notice, vacation is not forfeited, even if the statutory or contractual deadlines have passed. This case law significantly strengthens employees' position.
What must the employer's notice contain and when must it be given?
The notice must contain three elements: first, information on the number of open vacation days. Second, the request to take the vacation. Third, a reference to the impending forfeiture on 31 December or 31 March. The notice should be given in writing and early enough for it to be realistically possible to take the vacation. Ideally, the notice is given in November for forfeiture at year-end or in January for forfeiture on 31 March.
In the case of long-term illness, the employer must keep an eye on the 15-month period and give notice in good time for this as well. If no notice is given, vacation entitlements can remain in place for years and add up. When the employment relationship ends, considerable payments in lieu then fall due.
Checklist for employers
To do every year:
- Check the vacation balances of all employees as of 31 October
- Send written notices to everyone with remaining vacation (November)
- Secure proof of delivery (signature or email read receipt)
- Document vacation balances as of 31 December
- In January, give notice again of forfeiture on 31 March (for carried-over vacation days)
- For employees on long-term sick leave, calculate and document the 15-month period
- Before a dismissal, clarify vacation balances and record them in writing
Additionally, when a contract ends:
- Prepare the final vacation statement
- Clarify whether vacation can still be taken during the notice period
- Calculate payment in lieu of vacation (13-week average)
- Make the payment with the final payroll
- Keep documentation for any later queries
Conclusion: mistakes employers should avoid
Mistake number one: employers assume that vacation is forfeited automatically and do not actively inform employees. Without notice, nothing is forfeited. Mistake number two: the notice comes too late, so it is no longer realistically possible to take the vacation. A notice on 28 December for forfeiture on 31 December has no effect. Mistake number three: the 15-month period is not observed for employees on long-term sick leave. Employers assume the vacation is forfeited after one year and settle accounts incorrectly.
Clean documentation protects against back claims. Employers should record all notices, employee responses and vacation taken in writing. In legal disputes, the employer must prove that the duty to inform was fulfilled. Without proof, courts assume in favor of the employee that no notice was given.
FAQs
Is a doctor's certificate enough to get my vacation days back if I fall ill during vacation in Germany?
Yes, if the certificate of incapacity for work (AU-Bescheinigung) covers the first day of illness and you informed your employer without delay. The certificate must confirm actual incapacity for work, not just general malaise. If you fall ill abroad, the certificate must also be submitted to your health insurance fund, and your employer must be informed of your whereabouts. Without timely notification, you may lose your entitlement to continued pay.
Is my employment contract valid if it states that vacation is not forfeited despite illness?
Yes, such clauses are valid and more favorable to employees than the law. On 15 July 2025, the German Federal Labor Court confirmed that employment contracts can override the 15-month period if they explicitly protect statutory vacation in the case of long-term illness. Wording such as "Statutory vacation is not forfeited in the event of incapacity for work due to illness" means vacation entitlements are retained until the employment relationship ends. Check your contract for such clauses.
Can I take vacation while receiving sick pay from my health insurance fund?
No, you cannot take vacation while receiving sick pay (Krankengeld), because vacation requires fitness for work. If you receive sick pay, you are by definition unable to work. Your vacation entitlement does, however, continue to accrue in full during this time. Once you have recovered and returned to work, you can apply for the vacation built up during the sick pay phase; the days are only forfeited after the regular deadlines.
What happens to my vacation entitlement when sick pay ends after 78 weeks?
Your vacation entitlement remains fully intact, even after sick pay is exhausted. The 78-week period only concerns sick pay from the health insurance fund, not the vacation entitlement from the continuing employment relationship. As long as you are not dismissed, you can take the vacation days accrued during the entire illness after you recover; if the employment relationship ends, these days must be paid out. Document your vacation balances in writing with your employer after 78 weeks.
How do I calculate my vacation entitlement during probation if I am ill?
For each full month of employment, 1/12 of the annual vacation accrues, regardless of illness. Example with 20 days of annual vacation: after three months of probation (two of them on sick leave), you are entitled to 5 vacation days (3 months × 1.67 days). If you are dismissed during probation, this pro rata entitlement is retained, and the employer must either grant these days before the contract ends or pay them out. Illness does not interrupt the accrual of vacation entitlement.
How is payment in lieu of vacation calculated if I was dismissed during illness?
The calculation is based on the average gross salary of the last 13 weeks before the contract ends. If this period was marked by illness, there are two approaches: some courts use earnings before the illness began, others the hypothetical income without illness. With a monthly gross salary of €3,000 (five-day week) and 13 weeks of full work, the daily rate is around €138, so 10 open vacation days correspond to €1,380 gross in payment in lieu. Request the payment in writing immediately to preserve exclusion periods.
