The new digital sick note

Until now, every employee in Germany knew what the procedure was: they had to give their employer a printed sick note by the fourth day they were unfit for work. That requirement to provide a physical document is now to be abolished as of 1 January 2023 (at least in some cases) and replaced by a digital sick note.

In this article we’ll look at the context and at how the change in the law will be implemented in practice.

Legal situation to date

Under the 1st sentence of section 5(1) of the German Continued Remuneration Act (the “Act”), an employee has to tell their employer without undue delay that they are unfit for work and for how long (duty to notify). Besides simply telling their employer, employees also have the following duties under section 5(1) of the Act:

• If the employee is unfit for work for more than three calendar days, they must hand in a sick note saying roughly how long they will be off work, on the fourth day at the very latest (2nd sentence of section 5(1)).
  
  
• However, the employer may insist the employee hands in the sick note earlier (3rd sentence). Many employment contracts and collective or company agreements explicitly specify this.
  
  
• If the employee is off work longer than the sick note says, the employee has to provide a new sick note (4th sentence), and is still obliged to do so even if the employee will not receive any further pay in the event of illness.

New legal situation from 1 January 2023

The employee’s duties under section 5(1) of the Act will essentially still apply after the change in law from 1 January 2023. But a new subsection (1a) has been added to section 5, and this new subsection specifies exceptions to the principles of section 5(1) as follows:

The 2nd to 5th sentences of subsection 1 do not apply to employees with public health insurance. Those employees must have a doctor determine their unfitness for work on the dates given in the 2nd to 4th sentences of subsection 1 and how long they are likely to be off work for and issue a sick note in accordance with the 2nd to 4th sentences of subsection 1. The 1st and 2nd sentences do not apply to:

1. Part-time workers in private households (section 8a of the German Social Code, Volume 4)

2. Sick notes provided by doctors who do not work within the public health insurance system.

This addition to section 5 of the Act is accompanied by various social insurance rules:

• Under the existing section 295(1) 1st sentence, no. 1 of the German Social Code, Volume 5, doctors who work within the public health insurance system have to record the details of unfitness for work and send them to the public health insurers.
  
  
• Under the new version of section 109 of the German Social Code, Volume 4, also coming into force on 1 January 2023, after receiving those details from the doctor, the public health insurers will then produce a notification for the employer to call up. This will include in particular the employee’s name, start and end dates of unfitness for work, the date of the sick note, whether it is the first or a follow-on notification, and whether there are any indications the unfitness for work is due to an accident at work or another accident or to the consequences of an accident at work or another accident (new section 109(1) German Social Code, Volume 4).
  
  
• If the public health insurer discovers, based on the diagnosis information in the sick note and other data it has, that an employer’s continued pay for sickness will run out since the employee has deductible previous periods of sickness, it notifies the employer concerned, giving details of relevant previous periods of sickness (new section 109(2) German Social Code, Volume 4).

This means the new rules on electronic transmission of data on unfitness for work from the doctor to the public health insurer to the employer only apply if

• an employee has public health insurance,
  
  
• their unfitness for work is certified by a doctor working within the public health insurance system and
  
  
• the employee does not want to claim continued pay as a part-time worker in a private household.

However, in all other cases the old law remains in place, in other words the duty to hand in a printed sick note in accordance with the 2nd to 5th sentences of section 5(1) of the Act. This covers, in particular, employees with private health insurance, part-time workers in private households or those with a sick note from a private-sector doctor (one who does not work in the public health insurance system).

Despite the change in law, employees still have to notify their employer in accordance with the 1st sentence of section 5(1) of the Act. That means in future an employee still has to proactively tell their employer on the first day of sickness that they are unfit for work and how long they expect to be off work for.

Aim of the new law

The aim of the digital sick note is to reduce the administrative burden on employers and employees.

According to the rules in section 109 German Social Code, Volume 4, the public health insurer, after receiving a sick note for a publicly insured employee, is to provide the employer with the details previously recorded in the printed sick note for retrieval by the employer. The intention is that as a result of this digital procedure, publicly insured employees will no longer have to hand in a printed sick note.

In future, rather than handing in a printed sick note, according to the 2nd sentence of section 5(1a) of the Act, if relevant, employees will only have to consult a doctor on the dates mentioned in the 2nd to 4th sentences of section 5(1), have the doctor declare that the employee is unfit for work and for approximately how long, and get a properly issued, i.e. especially printed, sick note according to the 2nd to 4th sentences of section 5(1).

Thus the employee can keep the printed note as legally intended evidence of high probative value, as the case law concedes, so that if there are any glitches (such as the electronic transmission failing) the employee can prove their unfitness for work, in order to qualify for continued payment under section 3 of the Act.

The lawmakers specifically want to keep this printed sick note so employees can prove their unfitness for work to their employers until a suitable digital equivalent with the same high probative value is available. At the same time, it should be reviewed at regular intervals whether the conditions are in place for eliminating public doctors’ duty to provide a printed note.

Putting the new rule in practice

The new law has the following implications in daily practice:

Employer retrieves data on unfitness for work

Once a publicly insured employee has consulted a (public) doctor who has issued a sick note, an employer which has been told by the employee they are unfit for work can retrieve the related data from the relevant public health insurer within the scope of section 5(1a) of the Act. In light of this, HR/payroll departments in particular should familiarise themselves with the technical requirements for retrieving details of unfitness for work. When adapting existing IT systems to retrieve that data, there may be certain data privacy and co-determination rules to be complied with.

However, if the employer cannot retrieve the details of unfitness for work because of a glitch (such as technical issues at the doctor, health insurer or employer), the employee can prove they are unfit for work and for roughly how long using the printed note provided by the doctor.

Employer’s right to refuse performance

As the law stands, the employer may refuse to continue to pay wages until the employee has presented the sick note required by section 5(1) of the Act (section 7(1) no. 1 variant 1 of the Act). Despite introducing the new section 5(1a) of the Act, the lawmakers have not extended this right to refuse performance to entitle the employer to refuse continue to pay wages until the employee has fulfilled the duties of section 5(1a) of the Act, in other words until a doctor has certified unfitness for work. In doing so, the government has weakened the significance of section 7 of the Act to the detriment of employers. It is doubtful whether a corresponding right to refuse performance can be agreed in an employment contract or collective/company agreement without a statutory basis. Section 12 of the Act also forbids any deviation from the provisions of the Act and thus also from section 7(1) to the detriment of employees.

Ultimately, the employer initially bears the risk of the employee failing to fulfil their duties, even if the employer still has other options for response. In particular, the employer can give the employee a warning if they fail to fulfil their duties under section 5(1a) of the Act. If the employer also (justifiably) doubts whether the employee is actually unfit for work, it will initially refuse to continue to pay wages, stating that the conditions for entitlement in section 3(1) of the Act are not met. But all this depends on the individual case.

Current rules in employment contracts or collective/company agreements

Under section 5(1a) of the Act, an employee no longer has to hand in a printed sick note to their employer. This appears to apply even if an employment contract or applicable collective/company agreement still refers to the previous legal situation and requires a printed sick note to be presented:

• Under section 5(1a) of the Act, placing an agreed, unrequested duty on the employee to present a sick note appears to clash with the legislative aim. Only in the event of glitches, and only at the employer’s request, does the employee have to present a sick note.
  
  
• Thus a corresponding provision in an employment contract or collective/company agreement will be in conflict with the law from 1 January 2023.
  
  
• Corresponding provisions in employment contracts or collective/company agreements will thus probably have to be reinterpreted from 1 January 2023 due to this conflict. In our view, there are good reasons for interpreting corresponding provisions to the effect that under section 5(1a) of the Act, the employee is required to consult a doctor and have their unfitness for work determined no later than on the day they are required to submit a sick note to the employer according to the arrangement in the employment contract or collective/company agreement referring to the previous legal situation.

• This interpretation does not put employees at a disadvantage because they now have to do less than before: previously they had to first consult a doctor, have the doctor assess and certify their unfitness for work, and then, secondly, present the sick note to their employer, while now they only have to take the first step: have a doctor assess and certify their unfitness for work.

The same applies if an employment contract or a collective/company agreement stipulates that an employee must submit a sick note from the first, second or third day of being unfit to work due to sickness. Section 5(1a) of the Act does not alter the employer’s right to demand proof of unfitness for work even before the fourth day off work. Whether such contractual clauses make sense, however, always depends on the individual case in practice. In this context, employers should always bear in mind that employees who are obliged to present proof of unfitness for work from the first day are often absent for longer than employees who are allowed to be absent from work for one, two or three days due to sickness even without medical proof of being unfit for work.

Revising provisions, especially in employment contracts

Even if in our view there is no immediate need to revise employment contracts or collective/company agreements entered into before 1 January 2023, although this has not yet been confirmed by case law, model employment contracts should be revised to reflect the new legal situation in the future. Corresponding provisions, in particular in collective/company agreements, can be revised at the next opportunity to create clarity for all parties involved. When revising the relevant clause, it should be made clear that the new provision in particular does not apply to employees with private health insurance.

Regardless of the contractual situation, however, employers should inform their employees in good time about the new legal situation regarding the continued payment of wages. This also creates clarity and avoids misunderstandings. Employers should focus on the HR/payroll department employees. They need to be familiar with the legal framework and the technical communication with public health insurers from day one.