Mandatory Electronic Time Tracking: What Changed in Germany at the End of 2025

In December 2025, German employers faced an important clarification in labor law. The Federal Labor Court (BAG) made a ruling that requires all working hours to be tracked electronically—this applies to all companies, regardless of their size. Even small businesses with just a few employees can no longer ignore this rule.

Why Did This Happen Now?
It all started with a decision from the European Court of Human Rights (ECHR) in the Stegmann case in 2024. The ruling clearly stated that, in order to protect the health of workers, it is necessary to know exactly how many hours they work. Without a reliable time tracking system, it is impossible to control overtime, breaks, and adherence to legal standards. The BAG used this as the basis for its decision and on December 9, 2025, in its ruling (case number 9 AZR 234/24), confirmed: electronic time tracking is now the standard for all businesses.

Previously, many companies—especially smaller ones—relied on trust. Employees would record their hours manually in spreadsheets or not track them at all. However, the court decided that this was not enough. The system must be objective, reliable, and accessible; paper records or simple Excel files no longer suffice, as they can be easily tampered with or lost.

What Does This Mean in Practice?
Employers are now required to implement electronic tools: apps, programs, or cloud services where employees log the start and end of their working day, breaks, and overtime. This applies not only to office work but also to remote workers, freelancers, and even seasonal workers.

The Benefits Are Clear:

• Better protection against burnout – overtime becomes visible.
• Less conflict over overtime pay.
• Transparency for everyone: both for the employer and the team.

However, there are also challenges. Small businesses are concerned about the added bureaucracy and software costs. Large companies have been using such systems for years, but family-run businesses and startups will have to catch up. The good news is that a transition period is in place, and small businesses may be given some leeway.

How to Prepare?
If you’re an employer, don’t wait: choose a convenient tool (there are plenty of options, from simple mobile apps to payroll integrations). Train your team and explain why this is necessary—not as a control measure, but as a way to care for their work-life balance.

For employees, this is also a plus: it will now be easier to prove your hours and take rest time according to the rules. Ultimately, everyone benefits from greater fairness.

This change is a step toward a modern work culture in Germany. It emphasizes that health and honesty are more important than old habits. If implemented correctly, electronic time tracking will not be a burden but a helpful tool in everyday work routines.