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Germany’s private sector vacation pay coverage falls to 44%

The drop in collective bargaining coverage is eroding workers’ vacation pay entitlements.

Der Anteil der Beschäftigten der Privatwirtschaft in Deutschland, denen Urlaubsgeld ausgezahlt wird, ist verglichen mit dem Vorjahr gesunken. Der Wert lag bei 44 Prozent, wie das Wirtschafts- und Sozialwissenschaftlichen Instituts (WSI) mitteilte
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Overview

  • The share of private sector employees receiving vacation pay declined from 47% in 2023 to 44% in 2025.
  • Only 49% of workers remain under collective bargaining agreements, with 72% of those covered getting vacation pay versus 34% without a tariff deal.
  • A regional gap persists as 46% of West German workers receive vacation pay compared to 33% in East Germany.
  • Men are more likely to receive vacation pay at 48% versus 39% for women.
  • Larger employers lead the way on vacation bonuses, with 59% of firms over 500 employees paying vacation pay against 36% of firms with fewer than 100 staff.