In the private sector in Germany, this summer as well, just like last year, almost half of employees will receive vacation pay – that is, compensation for annual leave. This is the result of an online survey by an internet portal specializing in salaries.

The amount of compensation to be paid has hardly changed: while in 2023 the compensation amounted to 47 percent of gross salary, this year it amounts to 46 percent.

It is known when the money will be paid out

The money is usually paid with the June or July salary, WSI reported on Tuesday in Düsseldorf. The stated figures were obtained based on data from almost 68,000 workers from the beginning of May 2023 to the end of May 2024.

In companies with collective agreements, that rate amounts to 74 percent, German media report.

Whether workers will receive vacation pay or not depends on several factors. “By far the most important is whether a collective agreement applies in the company,” the statement says.

In private sector companies that are bound by collective agreements, around three quarters (74 percent) of those surveyed received vacation pay. In companies without a collective agreement, that is only 36 percent.

Where a collective agreement applies, basic salaries are generally higher, the institute points out. “Vacation pay is a real bonus for workers – and a good argument for employers bound by collective agreements who are looking for qualified workers,” explained a WSI income expert.

Coverage by collective agreements has declined significantly

However, coverage by collective agreements has declined significantly in Germany since the 1990s. According to data from the Institute for Employment Research (IAB), only half of all employees (49 percent) have a collective agreement. If only the private sector is taken into account, the rate is 42 percent.

The amount of vacation pay depends on the exact provisions of the collective agreements. “This year the range goes from 186 euros for employees in agriculture in Mecklenburg-Western Pomerania to 2,686 euros in the wood and plastics processing industry.”

The data refer to workers in the middle pay group.

Lower compensation in agriculture and hospitality

Apart from agriculture, vacation pay is also relatively low in the hotel and catering industry: in Bavaria, workers who have collective agreements receive an additional 240 euros, in Saxony 195 euros.

Special payments are noticeably higher in the paper processing industry, metal industry, graphic industry, motor vehicle industry, insurance sector, retail trade, construction industry and chemical industry, German media report.

Source: fenix-magazin.de