Performance bonus inclusion in sick pay, vacation, and year-end bonus calculations under collective agreements

The German Federal Labor Court (BAG) rejected the defendant's appeal, reinstating and partially modifying the prior judgments to rule that the employee prevails, ordering the employer to pay a monthly performance bonus of 524.26 Euros gross (less amounts already paid) for the period from July 1, 2007, to August 31, 2008, and to include this amount in the calculation of continued wage payments, vacation pay, and annual bonuses. The dispute concerned the applicability and calculation of specific compensation components under collective bargaining agreements, specifically challenging the employer's refusal or miscalculation of the performance allowance and its impact on related statutory and contractual entitlements. The decisive legal basis rests on the interpretation of the relevant collective agreements, including the Public Service Salary Law (EMTV) and the 13th Month Salary Agreement (ETV 13. Monatseinkommen), which mandate the inclusion of performance bonuses in the base for calculating supplementary benefits such as sick pay, vacation allowances, and year-end bonuses.