Are negative hours allowed by law?

Yes, negative hours are allowed by law. However, only within a working time account, and they only count as negative hours if they are not caused by the employer.

When do negative hours expire?

In principle, negative hours cannot expire. The contract sets out how long employees have to work off accumulated negative hours. If that does not happen, employers can reduce their pay accordingly.

Am I obliged to make up negative hours?

Yes, if the negative hours are your own fault (e.g. leaving early, oversleeping, etc.), you are obliged to balance them out within the framework set out in your contract and, of course, within the legal conditions. If negative hours arise because of the employer, for instance because they send you home early, they still have to pay for that time and have no right to expect you to make up the hours.

Negative hours in the working time account: the rules

What are negative hours?

Put simply, under employment law negative hours are the time that was not worked contrary to the contractual agreement. The result is a negative balance in what is known as the working time account. But that is where it starts: hours can only be described as negative hours if a working time account is in use and all statutory requirements for it are met.

What is a working time account?

A working time account works as follows: every hour worked is documented and offset in the working time account. At the end of the month or the year, these accumulated hours should match the target agreed in the contract.

If the total is above the target, it is overtime. How this is handled in the company - whether by payment or time off - has to be set out in the contract beforehand.

If the total is below the target, these are negative hours. Depending on the agreement and what triggered them, they can be deducted from pay. More on the criteria later.

A working time account must be agreed to expressly and in writing through a clause in the employment contract, in the works agreement and in the collective agreement! At that point it must also be recorded whether it is a long-term account (hours can be collected over the long term) or a short-term account (that is, the balancing period is limited to a maximum of one year). And also from what point this clause takes effect, meaning how much deviation is allowed without consequences, how the balancing takes place, and what happens to any negative hours when the employment relationship ends.

When do negative hours arise?

Legally speaking, negative hours can only arise for one single reason: when employees cut their working time on their own initiative for personal reasons and therefore do not reach the weekly, daily or monthly target set out in their contract.

This means the following are not described as negative hours:

Time lost and negative hours due to illness, because the German Continued Remuneration Act (Entgeltfortzahlungsgesetz) applies here. Under it, employees receive their pay during illness too, and no negative hours arise at this point.
Reduced working time due to a lack of jobs to do (instructed by the employer). In this case employers bear the responsibility for the hours not worked.
Vacation days. If these were requested and approved beforehand, they have to be paid. How many vacation days employees are entitled to is set out in the employment contract.

In these cases people generally also speak of negative hours through no fault of the employee.

What happens with negative hours that may have been calculated incorrectly?

How incorrectly calculated negative hours have to be handled depends on the cause. One reason can be faulty recording or documenting of working hours through a very error-prone time tracking system, because hours are written down after the fact, for example, or entering them is forgotten altogether. In most cases, employees have the option of correcting such errors afterwards (usually within a deadline). If that does not happen, negative hours can arise.

In other cases, incorrectly calculated negative hours can arise from hours being transferred incorrectly. Here too the cause is mainly the time tracking system. Since employers are obliged to keep the recorded working hours for at least two years, putting things right should be straightforward.

As you can see, choosing a reliable time tracking system is essential in order to avoid errors and conflicts. You will find an overview of the various time tracking solutions and their pros and cons here.

‍

May the employer order negative hours?

In principle, negative hours cannot be expressly ordered. Particularly where working hours are fixed in the contract, they cannot simply be changed by the employer. However, if a working time account is in use that has been agreed to in writing, and there are no fixed working hours, the employer can send employees home earlier.

In that case, though, the employer is also responsible for the negative hours that arise. That means they carry a legal and financial risk. So if, under Section 615 of the German Civil Code (Bürgerliches Gesetzbuch, BGB) negative hours arise for operational reasons ,because there is not enough work at that moment, employers have to pay for the hours not worked. Making up these hours or even cutting pay is not lawful at this point and can be pursued in court.

Note: negative hours caused by a lack of jobs to do are not legally tenable. Employers are obliged to enable their employees to meet their working time target.

Can negative hours build up during pregnancy?

During pregnancy, too, employees can build up negative hours, which can be offset in the same way as for other employees. However, no negative hours can arise from antenatal check-ups. The employer has to give pregnant employees time off for these appointments without any negative hours arising as a result.

Can apprentices build up negative hours?

Just as with other employees, apprentices can also build up negative hours, as long as a working time account has been agreed in the contract. But the same applies here: hours only count as negative hours if the employee caused them of their own accord. If an apprentice has nothing to do, the employer has to release them from work, and so they build up no negative hours.

Is short-time work the same as negative hours?

It is true that both short-time work and negative hours involve reduced working time. With short-time work, however, we are talking about a longer period in which employees work less. Negative hours, by contrast, relate to a much shorter period of a few hours. Short-time work also only arises when, due to special circumstances, there is significantly less work in the business, and it is declared by the employer.

How do negative hours have to be settled?

As set out above, hours only count as negative hours if employees are themselves at fault for the missing working hours. And even then there can only be consequences if the working time account was agreed in the contract beforehand.

Negative hours are usually balanced out with overtime. That can mean starting the working day earlier or leaving later. It is important to stay within the legal framework here. More on the legal basis here. These hours have to be worked off within what is known as the balancing period. That is set out in the employment contract. If the hours are not worked off within this period, a pay cut can follow. Negative hours cannot expire, though.

What happens to negative hours on termination?

If the employment is terminated, there are two ways of dealing with negative hours:

1. Either the employee is able to balance out the accumulated negative hours during the notice period,

2. or, if they cannot manage it within the legal framework, the employer may reduce their pay by the negative hours.

The negative hours that have accumulated must not, however, have been ordered by the employer, and they must have been recorded in a working time account.

What happens to negative hours at the end of the year?

If the working time account shows a negative figure at the end of the year, that does not automatically mean a pay cut. The employment contract sets out the period within which negative hours have to be balanced out. So they do not simply expire at the turn of the year either. That means anyone with negative hours at the end of the year can assume that these will be carried over into the following year, as long as the balancing period has not been exceeded.

Negative hours and working time accounts under the obligation to record working hours

So does the obligation to record working hours mean I have to introduce a working time account in my company? We can put your mind at rest. No, introducing a working time account does not necessarily go hand in hand with the obligation to record working hours.

The obligation to record working hours is based on the German Working Hours Act (Arbeitszeitgesetz, ArbZG) and is intended to make sure that the statutory break times and rest periods are observed. It can of course also be used to make sure employees are paid correctly and meet their working time target, but it does not oblige you to introduce a working time account that has to be regulated by contract.

But note: if, when introducing a time tracking system, it becomes apparent that employees are working too few hours, employers are not entitled to cut their pay automatically at that point. As long as no contractually agreed working time account has been introduced, unbalanced negative hours can at first only be raised in a conversation. If failure to meet the working time target occurs repeatedly, further consequences can follow, such as an amendment to the hours to be worked under the contract, or dismissal.

‍