Holiday Pay in Germany: Only 44% of Employees Receive It - Here's Why
Half of the working staff miss out on holiday pay entitlements.
German employees might find themselves in different situations when it comes to holiday pay. According to a recent survey by the Wirtschafts- und Sozialwissenschaftliches Institut (WSI) of the Hans-Böckler-Foundation, a mere 44% received this special payment.
If you're part of an establishment with a collective bargaining agreement, the odds of receiving holiday pay brighten up considerably. Almost three-quarters (72%) of employees in this category receive the holiday pay. Nevertheless, the lack of a collective agreement at your workplace may not necessarily mean a deficit of holiday pay. Instead, chances for holiday pay could depend more on factors such as statutory entitlements, company policies, and even regional differences.
"In many cases, establishments bound by a collective agreement offer higher basic salaries than those without such agreements," says Malte Lübker, a wage expert at WSI. But the amount of holiday pay varies greatly, ranging from 186 euros for employees in agriculture in Mecklenburg-Vorpommern to a whopping 2820 euros for employees in the wood and plastic processing industry in the Westphalia-Lippe tariff region. This variability is largely due to the collective agreement wage but can also include flat rates in some areas.
Thorsten Schulten, head of the WSI Tarifarchive, explains, "Where relatively high collective wages are paid, holiday pay is also significantly higher. Conversely, in the classic low-wage sectors, both the holiday payment and the likelihood of receiving it are generally lower due to the lower coverage of collective agreements."
Statutory entitlements establish a minimum of 20 paid vacation days per year for employees working a five-day schedule. Some companies offer more than the statutory minimum, often around 25-30 days. Collective agreements, company policies, and regional differences can further impact holiday pay considerably.
In collective agreements, employees might find better pay, more vacation days, and specific leave entitlements. These agreements can greatly influence holiday pay, but they vary across industries. For instance, manufacturing may provide more generous leave policies than retail due to historical union involvement. Similarly, regional variations exist, such as the additional public holiday in Saxony or local collective agreements.
Apart from collective agreements, company policies additionally shape employees' holiday benefits. Some companies offer annual leave purchase schemes, allowing employees to buy or sell vacation days, adjusting their salaries accordingly. This flexibility can vary widely across companies.
Overall, statutory laws set the baseline, but the actual holiday pay can differ significantly based on collective agreements, company policies, regional variations, and to a lesser extent, industry-specific practices.
- Science reveals that employment in sectors with robust union involvement, like manufacturing, often offers more favorable holiday pay and leave policies due to historical union involvement.
- In addition to statutory entitlements, the workplace-wellness and health-and-wellness sectors may provide unique holiday benefits, such as annual leave purchase schemes, which can offer employees flexibility in managing their vacation days.
- Finance plays a crucial role in holiday pay as well, with employees in industries paying higher collective wages, like wood and plastic processing, tending to receive significantly higher holiday pay compared to those in classic low-wage sectors.
