The discussion about mandatory digital time recording has been going on in companies for some time now. In this article, you will find all the important rulings and announcements relating to the time recording obligation, sorted by topicality. We explain the effects of the BMAS draft law, the BAG ruling and the ECJ ruling on time tracking and whether digital time tracking will become mandatory.
Note: This article is regularly updated by our HR experts.
April 2025: Does the 2025 coalition agreement between the CDU/CSU and SPD include an amendment to the time recording obligation?
The coalition agreement, which was presented by the CDU/CSU and SPD on April 9, 2025, also includes planned changes in the area of working time recording. The focus is on the mandatory introduction of time recording for all companies. This measure aims to promote transparency and fairness in the workplace. Employees are to be better protected by accurately documenting their actual working hours. The future federal government plans to use this obligation not only to strengthen employees’ rights, but also to ensure compliance with labor law provisions.
What specific regulations on time tracking are included in the 2025 coalition agreement between the CDU/CSU and SPD?
The 2025 coalition agreement between the CDU/CSU and SPD places greater focus on time tracking. The three parties emphasize the need to make working hours more transparent and comprehensible. It is expected that companies will be obliged to implement precise systems for recording their employees’ working hours. This regulation follows the rulings of the ECJ from 2019 and the BAG from 2022 and aims to prevent working time violations and strengthen employees’ rights.
In addition, digital solutions are to be promoted in order to minimize the administrative burden for both employers and employees. These measures should help to make the labor market more modern and fairer and improve the work-life balance. However, it remains to be seen when these plans will be implemented as planned and what specific form they will take.
Are there transitional periods for certain companies?
The 2025 coalition agreement states that transitional periods are planned for the introduction of mandatory time tracking. These periods are intended to give small and medium-sized enterprises (SMEs) in particular the opportunity to gradually adapt to the new requirements.
It is expected that the deadlines will vary depending on company size and sector – this was already part of the BMAS draft bill from 2023. The aim is to keep the administrative burden on companies as low as possible while ensuring that all companies can implement the new regulations within a reasonable timeframe. The exact details and conditions of the transition periods will be specified in further legal regulations or ordinances.
What does this mean for trust-based working hours?
The Coalition Agreement 2025 places great emphasis on the introduction of mandatory time tracking. This means an adjustment for trust-based working hours, as companies are now obliged to systematically document their employees’ working hours. This could affect the flexibility of trust-based working hours, at least to the extent that employees will have to record their hours and their position more precisely, including the legally prescribed rest breaks.
However, trust-based working hours are to remain in place in order to give employees the freedom to organize their working day. The focus is on increasing transparency and fairness to ensure that working hours are recorded correctly and overtime can be remunerated appropriately. Employers are required to implement suitable time tracking systems that comply with legal requirements while taking employees’ needs into account. This could lead to an increased use of digital tools to make time tracking efficient.
What other regulations on working hours does the coalition agreement provide for?
The Coalition Agreement 2025 provides for the maximum working hours to be made more flexible in order to meet the requirements of the modern working world. Under the current legal situation, employees’ working hours on weekdays may not exceed eight hours in accordance with Section 3 ArbZG. It can only be extended to up to ten hours if an average of eight hours per working day is not exceeded within six calendar months or within 24 weeks.
In future, a maximum weekly working time would enable employees to work more than the maximum working time of 10 hours per day and to balance their working hours over the course of a working week. The aim is to enable a better work-life balance. However, the exact form of these regulations is still being negotiated and depends on further talks between the coalition partners.
How can companies prepare for the new requirements?
A thorough analysis of the existing working time regulations in the organization is already advisable now in order to think about necessary adjustments that will result from specific legal regulations that will follow the coalition agreement. A modern software solution such as ZMI can help to optimally map flexible working time models and make the processes for recording attendances and absences more efficient.
April 2023: The draft bill of the Federal Ministry of Labor and Social Affairs
In light of the rulings of the ECJ (judgment of 14.05.2019) and the Federal Labor Court (13.09.2022, case no. 1 ABR 22/21), the Federal Ministry of Labor and Social Affairs (BMAS) presented a draft amendment to the Working Hours Act in April 2023. In particular, this is intended to regulate the already mandatory recording of working hours in more detail.
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More InformationWhat exactly are employers supposed to document in future according to the government draft?
Section 16 (2) ArbZG-E states: “The employer is obliged to electronically record the start, end and duration of the employee’s daily working time on the day the work is performed.” This means that employers remain responsible for the proper documentation of time tracking. Even if they can leave the duty of time tracking to the employees, employers must ensure that they are aware of any violations.
Working time must be recorded daily. The daily recording obligation can only be deviated from by collective agreement, company or service agreement, whereby the time must be recorded after 7 days at the latest.
Will electronic recording become mandatory?
The principle is to be electronic time tracking. Without making any concrete specifications here, the draft bill makes electronic recording mandatory. This means that standard time recording devices or systems, apps or other electronic tables can be used.
Are there any exceptions to the obligation for electronic time tracking?
There should be an exception for small businesses: Companies with fewer than 10 employees are to be exempt from the electronic time tracking obligation. The same should apply to foreign employers without a permanent establishment in Germany, if fewer than 10 employees are posted to Germany, and private households. In addition, exceptions to the electronic form can be agreed in collective agreements, company or service agreements.
So what about trust-based working hours in the future?
The BMAS defines trust-based working hours as flexible working time models in which the start and end of contractually agreed working hours are not fixed, but are left up to employees. This should continue to be possible, although the documentation obligation should remain in place.
Does the time recording obligation apply to all employees without exception?
The draft law only provides for an exception to the documentation obligation to a very limited extent: By collective agreement or on the basis of a collective agreement in a company or service agreement, it should be possible to agree that the obligation to keep records does not apply to employees “for whom the total working time is not measured or cannot be determined in advance or can be determined by the employees themselves due to the special characteristics of the work performed.”
When will the amended recording obligation apply?
In principle, the amended recording obligation should apply on the first day of the quarter following the promulgation. However, to enable companies to switch to electronic time tracking, there is to be a transitional period of one year after the law comes into force for the electronic form of time tracking. During this transitional period, time tracking “in paper form” should still be sufficient. Depending on the size of the company, longer transition periods are also to be provided for: a transition period of 2 years is to be granted for fewer than 250 employees and 5 years for fewer than 50 employees.
What happens if employers violate the obligation to keep records?
Fines of up to 30,000 euros may be imposed for breaches of proper documentation
What is a suitable system for recording working hours?
In its 2019 ruling, the European Court of Justice (ECJ) already stipulated that the recording must be reliable, objective and easily accessible. According to the reasoning of the Federal Labor Court, the use of electronic time tracking is not mandatory. Paper documentation is also expressly permitted.
However, the system must be audit-proof and practicable for the company and the employees so that the times are actually recorded. The obligation for time tracking can also be delegated to the employees. It can be assumed that the German legislator will also not strive for strict implementation requirements.
However, the use of a modern software solution for digital time tracking and absence management significantly streamlines processes through an intuitive recording process and digital integration of all employee groups in all industries. For example, construction workers who book at the terminal on site, sales employees who book in their car via their smartphone app or commercial employees in the home office who conveniently record their working hours via an employee portal. Ideally, the recorded data is automatically evaluated and transferred digitally directly to the payroll accounting system (such as DATEV). This results in less bureaucracy and the elimination of manual administrative processes.
ZMI offers you flexible solutions for recording working time. We will also find an individual solution for your company:
- Time tracking at the stationary terminal,
- at the PC workstation or
- Mobile with a variety of end devices
Would you prefer to call one of our experts?
Please contact us at: +49 9704 60392-100.
September 2022: Federal Labor Court sees mandatory working time recording
In its ruling(1 ABR 22/21) of 13.09.2022, the Federal Labor Court (BAG) in Erfurt states that employers are obliged under Section 3 (2) No. 1 ArbSchG to introduce a system with which the working hours worked by employees can be recorded. In doing so, the Federal Labor Court refers to the interpretation of the German Occupational Health and Safety Act (ArbSchG) in conformity with European law and thus to the ECJ ruling on working time recording from May 2019. The full reasons for the BAG’s ruling have now also been available since 02.12.2022.
At the same time, flexible working hours and work locations are being implemented across the board in German companies and organizations. This is giving rise to new areas of conflict, particularly in the context of the German Working Hours Act (ArbZG). Kathrin Reitner, Partner and Head of Employment Law at Grant Thornton Rechtsanwaltsgesellschaft mbH and Daniel Vogler, Managing Director of ZMI GmbH, spoke about this area of conflict and its impact on HR work in our ZMI #HR Inside Talk on 22.09.2022.
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More InformationZMI #HR Inside Talk on the ruling of the Federal Labor Court (BAG) on the obligation to record working hours with Kathrin Reitner, Partner and Head of Employment Law at Grant Thornton Rechtsanwaltsgesellschaft mbH and Daniel Vogler, Managing Director of ZMI GmbH.
What exactly did the Federal Labor Court (BAG) decide on 13.09.2022?
The Federal Labor Court’s ruling on working time recording came as a surprise, as the original issue was whether the
works council has the right of initiative to introduce a time recording system at employers. In the course of the decision on this question, the Federal Labor Court – according to the press release available to date – stated that employers must have a system with which employees can record their working hours.
On the basis of which applicable statutory regulations does the Federal Labor Court come to the conclusion that recording working time is mandatory?
So far, the German Working Hours Act (ArbZG) only stipulates the obligation to document overtime as well as work on Sundays and public holidays. Further obligations to record working hours may arise from individual legal norms, such as the Minimum Wage Act or the Act to Combat Illegal Employment, or from a collective agreement or a works agreement concluded between the employer and employees.
The European Court of Justice (ECJ) ruled back in May 2019 that companies in the EU will have to create systems in future that allow employees to measure their working hours. However, implementation should be left to national legislators. So far, however, the legislator in Germany has remained inactive and has not transposed the ruling into national law.
The Federal Labour Court (BAG) has now created facts and referred to a standard from the Occupational Health and Safety Act (ArbSchG), which states that employers must provide a suitable organization and the necessary means to comply with occupational health and safety regulations. From this, the BAG deduces that employers are obliged to introduce a system with which employees can record working hours. The BAG bases this on the ECJ ruling from 2019, which specifically means that working time recording is mandatory.
What will change as a result of the Federal Labor Court’s ruling on time tracking?
There are no changes to the provisions of the Working Hours Act. The working time regulations had to be observed and complied with before. However, the Working Hours Act previously only required the documentation of overtime and work on Sundays and public holidays. According to the BAG’s reasoning, the documentation obligation now extends to all working hours as a result of the new ruling.
When will working time recording become mandatory in Germany?
There is already an objective legal obligation to set up an (audit-proof) system to record the beginning and end and thus the duration of working hours , including overtime , of employees in the company. Employers should therefore promptly consider how employees’ working hours can be documented. The interpretation of occupational health and safety regulations in line with European law already results in an obligation to record working hours. Employers can also delegate the duty of time tracking to their employees.
Does the ruling of the Federal Labor Court mean an end to trust-based working hours?
There is still no conclusive clarity on this issue. However, with regard to the ruling of the Federal Labor Court and the ECJ ruling from 2019, the issue is that working time is controlled. A core element of trust-based working hours, on the other hand, is that employees’ working hours are not monitored. Strictly speaking, the ruling of the Federal Labor Court therefore contradicts the basic idea of trust-based working hours.
Trust-based working time models can provide a great deal of flexibility, but on the other hand also harbor the risk of work intensification. Especially in industries and workplaces where there is already a high degree of flexibility in terms of working hours and location, the use of a digital time tracking tool is a real benefit for employees and employers. This is because the recording of working hours ensures that the activities on often very fragmented working days ultimately become transparent and comprehensible for both sides. Trust-based working hours and trust-based time recording are therefore not mutually exclusive.
Is a handwritten timesheet also a form of time tracking or does it have to be digital?
In principle, a handwritten timesheet on which the start and end of working hours and rest breaks are documented is also sufficient. However, this manual method of recording working hours is only attractive at first glance, as it – like recording working hours in Excel – is associated with massive additional costs.
Do all employees have to record their working hours or are certain groups, such as field staff, exempt?
Case law does not differentiate between office-based and field-based employees. In this respect, working hours must also be documented regardless of the place of work. Recording options adapted to the work situation or workplace, such as a time recording terminal in the company, an employee portal on their own PC – also in the home office – or a mobile app for smartphones or tablets in the field, enable continuous digital working time recording in real time that suits the employee’s individual situation. Nothing can be inferred from the reasons for the ruling with regard to executive employees. However, there is much to suggest that they will continue to be exempt from the time tracking obligation.
Can complications arise if only the start and end of work are actively recorded, but no breaks?
On this issue, it remains to be seen to what extent the legislator will specifically regulate the obligation to record breaks. However, it is already common practice today to deduct the break times that employees have to take in order to encourage employees to actually take their breaks. The automatic deduction of the minimum break in accordance with the Working Hours Act can be easily stored in digital working time recording software.
The ECJ’s ruling on working time recording makes us sit up and take notice
Back in May 2019, the European Court of Justice (ECJ) ruled that companies in the EU must record all hours worked by their employees in future. Although the German legislator has not yet transposed the ruling into national law, it is already clear that the landmark ruling goes beyond the current binding legal situation in Germany and will change German employment law. The first court decisions based on the ECJ ruling have also been made, for example by the Emden Labor Court. In this situation, the question regularly arises as to which specific regulations now apply and what the ECJ ruling on working time recording means for companies. In the corona pandemic, this issue is becoming even more explosive, particularly due to the topics of short-time working and home office.You are currently viewing a placeholder content from YouTube. To access the actual content, click the button below. Please note that doing so will share data with third-party providers.
More InformationZMI #HR Inside Talk about home office, mobile working and the Working Hours Act with Sarna Röser, Dr. Laura Krings, Eva Grünbauer, Pascal Kober MdB and Daniel Vogler.
What regulations have applied so far?
Currently, the German Working Hours Act (ArbZG) only stipulates the obligation to document overtime as well as work on Sundays and public holidays. Further obligations to record working hours may arise from individual legal norms, such as the Minimum Wage Act or the Act to Combat Illegal Employment, or from a collective agreement or a works agreement concluded between the employer and employees. In addition, the works council ensures that the laws and regulations applicable to employees are implemented in accordance with Section 80 (1) No. 1 BetrVG. This also includes the provisions of the Working Hours Act. However, there has not yet been a comprehensive obligation for companies to record the working hours of their employees.
What will change in the future?
The German legislator will have to amend the Working Hours Act (ArbZG) in accordance with the ECJ ruling or pass an additional law that obliges employers to record all of their employees’ working hours using an objective and reliable system in future. So far, however, no details are known as to what the specific legislative structure will look like. A regulation is no longer expected before the federal elections in the fall of 2021. However, as time is running out, the pressure on legislators to implement the ECJ ruling is increasing.
What are the risks for companies in this situation?
The Emden Labor Court has already referred to the ECJ ruling on time tracking in several court rulings, arguing that an obligation for German employers to carry out time tracking can already be derived from this case law. Two of these rulings specifically concerned overtime worked by employees. The Emden Labour Court came to the conclusion that the ECJ ruling already has an impact on the burden of presentation and proof in the case of overtime in favour of the employee.
Will companies have to deal with additional bureaucracy?
In its ruling, the ECJ only stipulates that the recording must be reliable, objective and easily accessible. It can be assumed that German legislators will also not strive for strict requirements when it comes to implementation. A modern software solution for digital time tracking and absence management streamlines processes through an intuitive recording process and digital integration of all employee groups in all industries. For example, the construction worker who books at the terminal on site, the sales employee who books in the car via her smartphone app or the commercial employee in the home office who can conveniently record their working hours via an employee portal. Ideally, the recorded data is automatically evaluated and transferred directly to the payroll accounting system (such as DATEV) digitally. This results in less bureaucracy and the elimination of manual administrative processes.
Does the ECJ ruling mean the end of so-called trust-based working hours?
Trust-based working hours and trust-based time recording are not mutually exclusive. Especially in industries and workplaces where there is already a high degree of flexibility in terms of working hours and location, the use of a digital time tracking tool is a real benefit for employees and employers. This is because the recording of working times ensures that the activities on often very fragmented working days ultimately become transparent and comprehensible for both sides.
You can use ZMI’s time recording solution so that you can record working times in your company simply and easily in accordance with the BAG ruling. We will also find an individual solution for your company:
- Time tracking at the stationary terminal,
- at the PC workstation or
- Mobile with a variety of end devices
Would you prefer to call one of our experts? Please contact us at: +49 9704 60392-100.
