German Federal Labor Court: No obligation to look for a job early during a leave of absence

Do employees have to actively look for a new job during their notice period? No, decided the German Federal Labor Court (BAG) in its judgment of February 12, 2025 (5 AZR 127/24). In the case in question, the plaintiff was employed as a senior consultant. He received ordinary notice of termination and was irrevocably released from work during the three-month notice period.

Employer sent 43 job offers, stopped paying salary

His employer sent him 43 job offers, but the dismissed employee did not apply for seven of them until the end of the notice period. Thereupon, the employer stopped paying the salary for the last month and invoked Art. 615 sentence 2 of the German Civil Code (BGB), according to which remuneration can be waived if an employee maliciously refrains from earning money from other sources. Ultimately, the employee had failed to apply promptly for the job offers sent to him during his leave of absence.

BAG disagrees: No “malicious” failure to act on the part of the employee

The BAG disagreed with this reasoning. As the employer had unilaterally released the employee from his work, the former was in default of acceptance and was still obliged to pay salary for the entire duration of the notice period (Art. 615 sentence 1 in conjunction with Art. 611a (2) BGB). The judges clarified that the employee was not obliged to start and earn money from a new job before the end of the notice period in order to reduce the former employer’s financial burden.
The employer had not demonstrated that it would have been unreasonable to expect it to fulfill the plaintiff’s employment claim, which also existed during the notice period. In March 2023, the BAG had already ruled on the alleged malicious failure to earn money from other sources in another case (decision of March 29, 2023, case no. 5 AZR 255/22). Such case concerned the period after the end of the regular employment relationship. However, the current case is significantly different, as the employer stopped paying remuneration before the official end of the employment relationship.

Practical advice: Consequences for employers

Employers should differentiate between two periods when it comes to the question of compensation for default of acceptance:

1. Period between receipt of the notice of termination and the alleged termination date in the event of leave of absence:
   If the employee is released from work during this period, the employer bears the burden of proof that the continued employment of the employee was unreasonable. If this can be successfully demonstrated – and if the other requirements are met – the obligation to pay remuneration no longer applies.
2. Period after expiry of the notice period in the event of an action for unfair dismissal:
   During this period, it must be examined whether the employee can continue to claim the compensation for default of acceptance while the validity of the dismissal is being reviewed by the courts. This constellation has been the subject of several court decisions in the recent past, about which we have already reported (Berlin-Brandenburg regional labor court on September 30, 2022, 6 Sa 280/22; Baden-Württemberg regional labor court on May 3, 2024, 9 Sa 4/24)

With the current decision, the BAG emphasized the high requirements for the employer’s burden of presentation and proof when demonstrating the (un)reasonableness of employment in order to defend against claims for compensation for default of acceptance in the case of leaves of absence. Employers should continue to examine leaves of absence carefully and document their reasons and circumstances comprehensively.

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