Overtime compensation litigation remains extremely difficult for employees

Prevailing law made it extremely difficult for employees and their representatives to claim overtime compensation because employees had to assert and prove not only that they did in fact work each individual overtime hour claimed, but also that the employer either ordered or tolerated such overtime work.

In view of this situation, some employee representatives seemingly deduced from the May 14, 2019 judgment of the Court of Justice of the European Union (C-55/18) that, due to employers’ obligation to introduce a working time recording system, this would also permanently shift the employees’ substantive and procedural requirements in overtime compensation litigation to the employers.

This view has now been clearly rejected by the German Federal Labor Court’s ruling of May 4, 2022 – 5 AZR 359/22. Despite the judgment of the Court of Justice of the European Union, employees still need to demonstrate and prove in overtime compensation litigation that they performed work exceeding normal working hours and that the employer expressly or impliedly ordered, tolerated, or subsequently approved the overtime hours worked. In the Federal Labor Court’s opinion, this remains unchanged by the judgment of the Court of Justice of the European Union, as that ruling aims to ensure the protection of employees’ safety and health, but is not applicable to employee remuneration.

Following this Federal Labor Court ruling, overtime compensation litigation continues to present employees with the extreme difficulties they have already been experiencing to date.