Time credit
Time credit is the positive balance of a working time account: hours worked above the target time that have not yet been offset by time off or payment.
As of:September 2026
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.
MetronHR works these figures out itself: time accounts, premiums, overtime and the limits of the German Working Hours Act, with every booking.
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.
Further reading
- Section 307(1) BGB
- Section 611a(2) BGB
- Sections 7b to 7e SGB IV for long-term accounts
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: September 2026
Knowing the terms is one thing. Settling them cleanly is another.
MetronHR keeps time accounts, calculates premiums and checks the limits of the German Working Hours Act automatically. Try it free for 14 days.
No credit card, cancel any time
Related terms
Working time account
A working time account records how many hours somebody is above or below the agreed working time. The balance is settled over a defined period, through time off or through payment.
Negative hours
Negative hours are a negative balance in a working time account: the time worked is below the target time. Whether they have to be made up or can be set off depends on who caused them.
Cap limit
A cap is the agreed maximum or minimum value of a working time account. When it is reached, a defined consequence applies, for instance payment, transfer, or a ban on further extra work.
Time off in lieu
Compensatory time off means that extra work performed is offset by paid release from work instead of payment. It requires an agreement; it does not follow from the law.
Value credit
Value credit is accumulated remuneration set aside for later paid release from work, for instance for a sabbatical, care leave or early retirement.
Additional hours
Extra work in the narrow sense is work beyond the statutory maximum working time. Overtime is work beyond the contractually agreed time. In everyday language the two terms get mixed up.
Blanket settlement
A blanket settlement is the contractual clause under which overtime is supposed to be already paid for with the agreed salary. In its widespread wording it is ineffective.