If the employer does not pay the salary, or pays too late, the employee has a salary claim against the employer. A salary claim may arise, for instance, in case of insolvency, in case of conflict during sickness or in an dismissal situation.
Court proceedings
If the employer ignores the employee’s request to pay salary, the employee may initiate court proceedings. The employee should file a claim with the court no later than five years after the due date. After expiration of five years the employee can no longer claim the salary.
When do I have a salary claim?
The employee has a salary claim against the employer as of the date the salary is outstanding. Salary is outstanding from the moment that the salary should have been paid according to the employment contract or collective labor agreement or other contractual arrangements. If there are no written agreements, the employer must pay the salary ultimately on the last day of the period in which the work has been performed. For example, the salary for the month of January must be paid before 1 February. As of 1 February, the salary is overdue.
Statutory interest and statutory increase (penalty for late salary payment)
If the employee has a salary claim against the employer, the employer incurs a penalty for each day the salary is outstanding, the so-called statutory increase. The first three days, no statutory increase is due. However, after the first three days, the statutory increase may add up quickly: during day 4 – 8 the statutory increase amounts to 5% of the gross salary per day the salary is outstanding. After the 8th day, this is increased by 1% per day. The maximum statutory increase amounts to 50% of the outstanding salary.
In addition, the employee is entitled to the statutory interest. Statutory interest is the interest that a creditor may claim from a debtor in case of late payment in general. This also applies to late salary payment.
The statutory interest is calculated on the salary outstanding plus the statutory increase. In 2024 the statutory interest amounts to 7% of the sum due.
Salary claim in case of bankruptcy
If the employer does not pay salary because of insolvency, a bankruptcy petition may be filed with the court. If the employer is declared bankrupt, employees are entitled to benefits from the UWV (Employee Insurance Agency).
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