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It is money, not just a number
Behind every hour of credit stands an entitlement to pay that has already arisen. The account only shifts the moment at which it is met, and the form: time off instead of payment.
From that follows the most important consequence: credit cannot simply expire. A clause under which hours fall away without replacement at the end of the year is an unreasonable disadvantage and, as a standard term, as a rule ineffective under section 307(1) BGB.
What can be validly agreed
A cap above which further hours are paid out or transferred into a long-term account. A date on which it is settled. Priority for compensatory time off over payment. An exclusion period within which claims have to be asserted, provided it is at least three months and binds both sides equally.
What is impermissible, by contrast, is anything removing an entitlement that has already arisen without replacement.
It is settled on departure
Credit that can no longer be run down as time off has to be paid out. That applies even where the employment contract provides only for compensatory time off: where that is in fact no longer possible, payment takes its place.
Example: payment on departure
- Balance on departure: 62 hours.
- Monthly salary 3,400 euros, weekly working time 38 hours.
- Hourly rate: 3,400 euros ÷ (38 × 4.348) = 20.58 euros.
- Payment: 62 × 20.58 euros = 1,275.96 euros gross.
Common mistake
The credit gets built up over years and nobody works out what it costs. With twelve employees at 60 hours each that quickly comes to 15,000 euros, which ought to appear as a provision in the accounts and often does not.
This is not legal advice; for a specific case at your workplace you are better off asking someone qualified to give it.
Published by: AMNAU GmbH
Editorial responsibility: Ugur Aydogan, Product development.
Last reviewed: 2 September 2026