Lukas Bornschlegl

Granting time off during the notice period is often sensible and advisable for employers, for example to avoid tension in the workplace or to protect trade secrets and customer relationships. However, such a leave of absence is not automatically legally permissible: the right to employment, which derives from the general right to privacy, generally continues until the end of the employment relationship. In its ruling of 25 March 2026, reference number 5 AZR 108/25, the Federal Labour Court (BAG) has provided legal clarity on leave-of-absence clauses in employment contracts, which have since become standard features of such contracts. This article summarises the Federal Labour Court’s ruling on exemption clauses and provides answers to the question of what employers should now bear in mind regarding exemptions in the event of termination.

With the “Programme for Economic Recovery and Employment” adopted by the coalition committee, the Federal Government has announced numerous reforms to labour law. The aim is to ease the burden on businesses, make the labour market more flexible and reduce red tape. The announced changes are already attracting considerable attention. On closer inspection, however, it becomes clear that many of the proposals affect only a limited group of employers or can already be implemented to a large extent under current law. There is currently no need for businesses to make hasty adjustments. It is, however, advisable to monitor further legislative developments closely and, if necessary, to respond in due course.