Federal Labor Court Decision: No wage claim of marginally employed persons in the event of a temporary closure of the company due to a corona lockdown

In a ruling dated October 13, 2021 (5 AZR 211/21), the Federal Labor Court (Bundesarbeitsgericht, BAG) decided that employees are not entitled to wage payments if the employer has to temporarily close its business as a result of a government-imposed general “lockdown” to combat the Coronavirus pandemic.

Facts:

The plaintiff, a marginally employed person, demanded payment of wages for the month of April 2020 from her employer, who operates a trade in sewing machines and accessories. In April 2020, he had to close his Bremen branch due to the “Corona Order” issued by the Free Hanseatic City of Bremen. As a result, the plaintiff was unable to work and the employer accordingly stopped paying her wages.

Both the Verden Labor Court and the Lower Saxony Regional Labor Court then ordered the employer to pay the wages for the period of the lockdown. In their reasoning, these courts stated that the employer owed payment of the remuneration even if the employee was unable to work, from the point of view of default of acceptance. In the opinion of the Labor Court and the Regional Labor Court, the employer bore the operating risk. If he could not employ the employee due to the officially imposed lockdown, this did not change the fact that it was the employer’s risk to be able to employ his employees. The employee in question was therefore entitled to the default of acceptance wages. Contrary to the previous instances, however, the Federal Labor Court (Bundesarbeitsgericht, BAG), in its decision of October 13, 2021 (5 AZR 211/21), found that the plaintiff could not claim any remuneration for the period of the lockdown-related loss of working hours and dismissed the action.

Reasoning:

The BAG justifies its decision by stating that the employer does not bear the risk of loss of working hours if an official government order leads to the closure of all facilities that are not necessary for the supply of the population.

It is true that the operational risk lies in principle with the employer, which is why in the event of employees being unable to perform their work due to operational reasons, the workers employed by the employer are regularly entitled to wage payments, even if the employer was unable to put them to work. However, this does not apply in the case of plant closures as a result of a general “lockdown” ordered by the state and the associated loss of work.

According to the view of the Federal Labor Court (Bundesarbeitsgericht, BAG), a plant closure resulting from a government-ordered lockdown is the consequence of a sovereign intervention to combat a dangerous situation affecting society as a whole. It is thus the responsibility of the federal government to ensure that the financial disadvantages of the affected employees are adequately compensated. The state complied with this by facilitating access to short-time work allowance.

However, marginally employed persons are not subject to social security contributions. Accordingly, these employees do not have access to short-time work allowance, so that the loss of earnings is not compensated by the state. However, the Erfurt judges emphasized that these circumstance do not justify an obligation to pay on the part of the employer. This has to be seen as a gap in the social security system, which should not be blamed on the employer.

Conclusion:

In this decision, the Federal Labor Court limits employers’ liability for absences due to inabilities to work by ruling that officially ordered measures leading to work absences do not result in an employer’s obligation to pay remuneration for the lost work time.