Part-Time Sick Leave and Bonus Payments Better than Sick Pay Cuts or Waiting Days
ResearchZEW Study on Discussions Around Reducing Absence Rates
Germany has one of the highest sick leave rates worldwide. The very generous provisions for sick pay in Germany drive these high rates, as studies have shown. Some political and business representatives are therefore calling for a waiting day (“first sick day unpaid”) or a reduction of the minimum sick pay level as stipulated by German social security law to around 80 per cent of gross wages (“wage replacement rate”). However, such measures would be counterproductive. These are the findings of a ZEW study, which was recently published in the 2025 Absence Rate Report issued by the AOK Research Institute (WidO). The report instead advocates the introduction of part-time sick leave, firm-specific bonus payments for those with few sick days, and more company initiatives for flu and Covid vaccination programmes.
“Germans feel it would be socially unjust to be penalised for being ill. It is true that studies confirm a reduction in sick days as a result of waiting days or a lower sick pay: For instance, if sick pay was reduced by 20 per cent, the number of sick days taken would fall by roughly 20 per cent as well. Such measures would reduce the number of shirkers. However, at the same time, cuts in sick pay would result in more presenteeism – where employees are working sick, some of them despite having an infectious illness, and risk passing on the illness to co-workers. In addition, a study from Sweden shows that waiting days would lead to an unnecessary increase in long periods of sick leave to avoid another unpaid sick day in case of relapses,” says Professor Nicolas Ziebarth, head of ZEW’s “Labour Markets and Social Insurance” Research Unit.
Part-time sick leave: A proven concept in Sweden
Ziebarth proposes instead: “An approach to modernise our sick pay system would be to introduce part-time sick leave, which has already proven its effectiveness in the Scandinavian countries. Depending on the illness and occupation, it may well be possible to work half a day instead of a full day in certain cases. This applies, for example, to working from home for a few hours in the case of mild colds, back pain or mental illness. The doctors issuing the sick note would have to be trained accordingly, however. If it were possible to convert just ten per cent of sick days – a good 900 million – into half-day sick leaves, the German economy would gain around 45 million working days, roughly the same as if a national public holiday were eliminated.”
Rewards and incentives instead of penalties
Companies could implement further options themselves: “Studies in psychology and behavioural economics show that rewards are more effective than penalties. Companies could design positive incentive systems in which employees with fewer days of absence receive cash bonuses, in other words ‘attendance bonuses’. Furthermore, because absenteeism also reflects the job satisfaction of the workforce, companies should develop targeted measures to improve the workplace climate. Also, in an international comparison, flu vaccination rates in Germany are very low at only one third of adults, although absence rates due to infectious diseases have strongly increased in recent years. Motivating employees and offering low-barrier options for flu and Covid shots at work would be effective countermeasures.”
Wage reductions already failed in the 1990s
In 1996, following a similar debate, the then CDU/FDP government implemented a cut to statutory sick pay to 80 per cent of gross wages. “Most trade unions were successful in negotiating this away in collective bargaining. At the time, employers in almost all industries agreed to voluntarily continue to pay 100 per cent of wages, making the statutory sick pay reduction a blunt sword. Moreover, the sick pay cut increased inequality across jobs because it primarily affected employees in lower-paid professions who were not covered by collective agreements. The reform therefore had only limited effectiveness, and in 1999 it was withdrawn by the newly elected red-green government. Even in the election campaign for the 2025 federal election, no party put the issue on the agenda,” explains Ziebarth.
