In its judgement of 16 April 2025(case reference: 10 AZR 80/24), the Federal Labour Court ruled for the first time that a contractually agreed commission claim can also be fulfilled in the cryptocurrency Ether, provided this is objectively in the employee’s interest. It should be noted that the part of the salary that is within the garnishment-free limit is excluded from this. This non-garnishable amount of pay must continue to be paid out in euros.
Background
The plaintiff was employed by the defendant, a company specialising in cryptocurrencies, among other things. Her most recent basic salary was EUR 2,400.00 gross per month. The employment contract also provided for a commission based on monthly transactions. The contract stipulated that the commission was initially to be calculated in euros, converted into ETH at the current exchange rate on the due date and paid. Although the plaintiff had already notified the defendant of a corresponding wallet on 11 August 2020, the defendant failed to make a transfer. It was not until the payroll for December 2021 that the defendant paid the plaintiff a lump sum commission of EUR 15,166.16 gross. The plaintiff considered this payment to be insufficient and demanded an additional 19.194 ETH for the months of February and March 2020. The defendant was of the opinion that, insofar as the commission claims were justified, it had fulfilled them by paying the EUR 15,166.16 in December 2021. It was also of the opinion that Section 107 (1) GewO did not permit payment only in euros and not in ether.
Both the Labour Court and the Baden-Württemberg Regional Labour Court largely upheld the claim; the defendant then lodged an appeal with the Federal Labour Court.
The decision of the BAG
The BAG overturned the judgement of the court of first instance and referred the case back to the Baden-Württemberg Higher Labour Court for a new decision.
The BAG clarified that the plaintiff was entitled to the claimed commissions on the merits and that these were to be fulfilled by transferring Ether.
Although cryptocurrencies do not qualify as remuneration within the meaning of Section 107 (1) GewO, the remuneration must therefore be paid in euros. Nevertheless, Section 107 para. 2 sentence 1 GewO opens up the possibility of agreeing remuneration in kind as part of the remuneration, provided that it serves the interests of the employee or corresponds to the nature of the employment relationship. In the present case, such an interest of the plaintiff was given, as the transfer of the commission in crypto was explicitly agreed in the employment contract.
The BAG also emphasised the protective function of the garnishment exemption limits: Employees must not be forced to sell benefits in kind first in order to be able to cover their living expenses. The non-garnishable portion must always be paid out in euros. Only the value that exceeds this exemption amount can be paid in euros.
Therefore, an agreement that provides for the non-garnishable net remuneration in cryptocurrency is partially invalid because it violates Section 107 para. 2 sentence 5 GewO. The consequence of such a violation is that the remuneration must be paid in cash up to the respective garnishment exemption limits and the remuneration in kind must be reduced accordingly.
The LAG Baden-Württemberg had correctly assumed these principles, but had not correctly applied the statutory requirements when determining the garnishment exemption limits in accordance with Sections 850 et seq. ZPO did not correctly take into account the statutory requirements. The case therefore had to be referred back to the LAG for a new hearing and decision.
Conclusion
It is to be welcomed that the BAG has provided clarity for the first time regarding the payment of wages in cryptocurrency, as cryptocurrencies have long been more than just a niche phenomenon. Numerous companies are advertising direct salary payments in crypto assets or salary conversion from euros to crypto, for example, thus opening up new remuneration options.
Practical tip
Employers should ensure that remuneration in the amount of the seizure exemption limit is paid out in full in euros. In addition, crypto-based remuneration models must be transparent and clearly regulate conversion rates, due dates and transfer modalities. Compliance with the minimum wage threshold must also be ensured.