01. April 2019

The German Federal Labour Court (Bundesarbeitsgericht) has ruled: Travel time also beyond the regular working hours is regularly working time subject to remuneration – unless otherwise agreed. Therefore, employers are henceforth well advised to make explicit agreements regarding the remuneration of business trips.The classification as working time in the sense of occupational safety or as work requiring remuneration is often inconsistent, especially with regard to business trips. 

Whereas, as before, the consideration under occupational safety law depends on the extent to which the employee is occupied during the time period in question (so-called Beanspruchungstheorie), the German Federal Labour Court has now made a complete turnaround with regard to the obligation to pay remuneration with its judgment dated 17 October 2018 – file reference 5 AZR 553/17: Whilst previously an employee could not expect any remuneration for travel times beyond the regular working hours without a separate agreement or exceptionally expected remuneration in the sense of Section 612 German Civil Code (Bürgerliches Gesetzbuch), it is now exactly the opposite. In principle, he can expect compensation for any travel time unless the parties agree otherwise. Especially for employers whose employees undertake many business trips, this decision can have considerable financial consequences.

In the given case, the employee had been seconded to China for a foreign assignment. At the employee’s request, a business class flight with a stopover in Dubai was booked instead of a shorter economy flight. The employee then claimed remuneration for the total travel time of four days between his home and the external workplace. The employer had paid the contractual remuneration for only eight hours per travel day. The secondment agreement (Entsendevereinbarung) between the parties did not contain any provisions on the remuneration of travel time.

The German Federal Labour Court ruled in favour of the employee and decided that, in principle, travel time must be fully remunerated. The framework collective agreement for the employees and foremen of the construction industry (RTV-Bau) did indeed apply to the employment relationship. However, the German Federal Labour Court has not derived the claim to remuneration for the travel times from the RTV-Bau but from Section 611 para. 1 German Civil Code (now Section 611a para. 2 German Civil Code) because the customer visit is part of the employee’s major obligations by means of Section 611 para. 1 German Civil Code arising from the employment agreement.

The German Federal Labour Court thus delimits the obligation to pay remuneration in accordance with the cause for the business trip of the employee. If he acts exclusively in the interest of the employer (fremdnützig) in order to fulfil his major obligations arising from the employment agreement, the travel time is generally subject to remuneration. The domestic travel time of the employee from the company to a foreign workplace as well as the travel time from the employee’s home to the foreign workplace are to be treated likewise if these are part of the employee’s major obligations (e.g. field staff). In contrast, the employee’s travel time from his or her home to the company – which is not subject to remuneration – is exclusively in his or her own interest (eigennützig).

In the present case, however, the BAG doubted whether the travel time was actually necessary and thus made the necessity a further criterion for the question of the remuneration obligation. If the employer specifies travel details, the travel time required to meet these specifications is necessary. If, on the other hand, the employee is free to determine the travel details himself, he must choose the cheapest option in accordance with the consideration obligation pursuant to Section 241 para. 1 German Civil Code. In the present case, this would have been a direct economy class flight. Exceptionally, this may not apply if it is unreasonable for the employee in the individual case.

As a result of this ruling, it is essential for employers to ensure that the claim to remuneration for business trips undertaken in the employer’s interest is regulated or limited by individual or collective agreement. This saves them from having to pay excessive remuneration entitlements for the travel time. It should be noted, however, that the statutory minimum wage may not be undercut even if travel times are taken into account. In addition, the limits of the Working Time Act must be respected. In particular, if flight or travel times cannot be used for processing files or the like in order to comply with the statutory rest periods, an agreement to exclude remuneration for this travel period is absolutely in the employer’s interest.