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17.12.2024 | KPMG Law Insights

BAG: Part-time employees can also claim overtime pay

If full-time employees are entitled to overtime pay from the first hour of overtime, this must also apply to part-time employees, the Federal Labor Court (BAG) has ruled (judgment of December 5, 2024 – Ref. 8 AZR 370/20 – previously only available as a press release). A collective agreement provision according to which employees only receive overtime pay if they exceed the working hours of a full-time employee, regardless of their individual working hours, discriminates against part-time employees. In the specific case, the plaintiff is employed with a capacity of 40 percent. Her employment relationship is governed by a collective agreement concluded between the employer and the trade union ver.di. According to this agreement, overtime is subject to a surcharge. However, the collective agreement only defines overtime as hours that exceed the monthly working hours of a full-time employee. According to the collective agreement, full-time working hours are 38.5 hours per week. Part-time employees have therefore rarely benefited from overtime bonuses if they have worked more than their individual weekly working hours.

Part-time employees are entitled to remuneration in proportion to their working hours

The BAG had referred the question to the ECJ as to whether the collective bargaining regulation violated EU law. The ECJ affirmed this and answered the question in its ruling of July 24, 2024(C-184/22 and C-185/22) as follows The collective agreement regulation violates both Directive 97/81/EC on part-time work and the Equal Treatment Directive (2006/54/EC), as considerably more women than men were affected by the regulation. The ECJ had argued in the reference that overtime pay was regulated equally for all employees, in that everyone was entitled to the supplement if the limit of 38.5 hours was exceeded. However, part-time employees have to work a larger number of overtime hours without a supplement, while full-time employees can claim a supplement from the first overtime hour. This is inadmissible unequal treatment. The remuneration of part-time employees must correspond proportionately to their working hours to that of comparable full-time employees. Unequal treatment can be justified by objective reasons. However, the BAG did not see an objective reason. In particular, the BAG does not appear to follow the argument that a burden justifying the overtime bonus can only be assumed once the working hours applicable to full-time employees have been exceeded. The BAG awarded the plaintiff a time credit in the amount of the overtime premium as well as compensation for indirect discrimination on the basis of gender.

How employers should react to the BAG ruling

Until now, it has not been unusual for overtime bonuses to be paid only for hours worked in excess of the regular working hours of full-time employees. Corresponding regulations can often be found in collective agreements. From now on, they should apply the same standards for calculating overtime bonuses for their part-time employees as for full-time employees, i.e. they must be granted a bonus from the first hour of overtime in relation to their individual working hours if this is also the case for comparable full-time employees. Part-time employees can often be inadvertently discriminated against. There is a risk that part-time employees are unjustifiably disadvantaged not only in terms of pay, but also in terms of vacation arrangements, the allocation of tasks and access to company facilities. The discrimination of part-time employees is prohibited under Section 4 (1) TzBfG. If employers do not comply with the equal treatment requirement, they risk legal action. If the part-time employees are predominantly women, this may also constitute discrimination on grounds of gender and trigger a claim for compensation pursuant to Section 15 (2) AGG.

 

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