Germany is preparing to overhaul its sick leave rules, making it easier for employers to require workers to provide a doctor’s certificate from the very first day they call in sick. The proposal is part of Chancellor Friedrich Merz’s broader economic reform agenda aimed at improving productivity, reducing absenteeism, and helping revive Europe’s largest economy after a prolonged period of sluggish growth.

The proposed changes have already sparked debate. Supporters argue the measures could discourage misuse of sick leave and reduce costs for businesses. Critics, however, question whether stricter rules could place additional pressure on genuinely ill employees and burden an already busy healthcare system.

As Germany attempts to balance worker protections with economic competitiveness, the country’s sick leave rules are becoming a central part of a much larger conversation about labour reforms, taxes, and long-term growth.

TL;DR

• Germany plans to tighten its sick leave rules as part of a 34-point economic reform package.
• Employers could require employees to submit a doctor’s certificate from the first day of illness.
• The government says high absenteeism is hurting productivity and economic growth.
• The reforms also include tax cuts for lower-income households, pension changes, and more flexibility for employers hiring fixed-term workers.
• Parliament is expected to debate key elements of the package before the end of the year.

Why Is Germany Changing Its Sick Leave Rules?

The proposed policy comes amid growing concerns that Germany’s economy has struggled to regain momentum in recent years.

Businesses have faced several challenges simultaneously, including:

• Weak economic growth
• High energy and production costs
• Labor shortages in key industries
• Rising employee absenteeism

According to Chancellor Friedrich Merz, reducing unnecessary sick leave is one way to improve workplace productivity without placing additional financial burdens on employers.

Speaking while unveiling the government’s 34-point reform package, Merz said Germany’s number of sick days is “too high” and argued that both companies and employees need new tools to address the issue.

The proposal is not being presented as an isolated workplace policy but as one piece of a broader strategy designed to strengthen Germany’s competitiveness.

How Would the New Sick Leave Rules Work?

Current system

Until now, German employees have generally enjoyed relatively flexible sick leave procedures.

Depending on company policies and medical practices, workers could often:

• Report themselves sick for several days without immediately visiting a doctor, or
• Contact a physician and receive a medical certificate without an in-person examination in certain cases.

This system became especially common during and after the COVID-19 pandemic, when remote consultations expanded significantly.

Proposed changes

Under the new proposal:

• Employers would have greater authority to require a doctor’s certificate from the first day an employee calls in sick.
• Employees may need to visit a doctor in person immediately instead of waiting several days.
• The reforms are intended to make obtaining sick leave more rigorous and reduce short-term absences that employers believe are difficult to verify.

Importantly, the proposal does not eliminate paid sick leave. Instead, it changes how quickly medical documentation may be required.

Why Does the Government Believe This Matters?

The government’s argument is largely economic.

Germany has consistently reported some of Europe’s highest levels of employee absenteeism. While many absences are linked to legitimate illnesses—including seasonal infections, mental health conditions, and chronic diseases—business groups have increasingly argued that high absence rates reduce productivity and raise operating costs.

Officials say frequent short-term absences can create several challenges:

• Disrupt production schedules
• Increase overtime costs for the remaining staff
• Delay projects and customer service
• Raise administrative expenses for employers

The government believes requiring medical certification earlier could discourage abuse of the system while encouraging better attendance among workers who are capable of working.

However, economists note that absenteeism is often influenced by broader factors such as workforce demographics, workplace stress, infectious disease outbreaks, and access to healthcare—not simply employee behaviour.

What Else Is Included in Germany’s Reform Package?

The proposed sick leave changes are only one element of Chancellor Merz’s wider economic agenda.

More flexibility for employers

The government wants companies to have greater freedom when hiring new employees.

One proposal would allow businesses to offer fixed-term employment contracts lasting up to four years for newly hired workers through 2030.

Supporters say this gives employers more confidence to hire during uncertain economic conditions.

Critics argue that longer temporary contracts could reduce job security for workers.

Income tax cuts for lower-income families

Another major feature of the package is approximately €10 billion in income tax relief.

The government says these tax cuts are intended to increase disposable income and stimulate consumer spending.

To help finance the reductions, the top income tax rate would increase:

• Current top rate: 45%
• Proposed top rate: 47%
• Applies to annual earnings of €280,000 or more

This approach aims to combine tax relief for middle- and lower-income households with higher contributions from top earners.

Pension reforms

The package also includes pension reforms designed to improve the long-term sustainability of Germany’s retirement system.

While the government has not yet finalised every detail, officials say the goal is to adapt the pension system to an aging population while maintaining fiscal stability.

Why Is Germany Under Pressure to Improve Productivity?

Germany’s economy has faced an unusually difficult combination of structural and global challenges over the past several years.

Among them:

• Higher manufacturing costs
• Slowing industrial output
• Global supply chain disruptions
• Rising competition from international manufacturers
• Demographic changes leading to labour shortages

Because Germany is Europe’s largest economy and one of the world’s leading exporters, even modest declines in productivity can have broader effects across European markets.

The government believes labour market reforms—including changes to Germany’s sick leave rules—can help businesses become more efficient without significantly increasing public spending.

Still, many labour experts caution that productivity depends on multiple factors, including investment, technology adoption, workforce training, and healthcare access.

What Are the Main Arguments For and Against the Proposal?

Supporters say:

• It discourages misuse of sick leave.
• It improves workplace accountability.
• It reduces administrative uncertainty for employers.
• It could help increase overall productivity.

Critics argue:

• Genuine patients may feel pressured to work while ill.
• Doctors could face higher appointment demand for relatively minor illnesses.
• Healthcare waiting times may increase.
• The policy may not significantly reduce absenteeism if illnesses are legitimate.

The debate ultimately reflects a broader question many developed economies face: how to balance strong worker protections with economic competitiveness.

What Happens Next?

The governing coalition plans to move key elements of the reform package through parliament before the end of the year.

Because the package spans taxation, labour laws, pensions, and employment regulations, lawmakers are expected to debate individual provisions extensively.

The final legislation may differ from the current proposal depending on negotiations among coalition partners and parliamentary committees.

For employers and workers alike, the coming months will determine whether Germany adopts one of its most significant labor policy changes in years.

What This Means Beyond Germany

Although the reforms are aimed at Germany’s domestic economy, policymakers elsewhere will likely watch closely.

Several European countries are also grappling with:

• Aging populations
• Labor shortages
• Slower economic growth
• Rising healthcare costs

If Germany’s approach successfully improves productivity without undermining employee well-being, it could influence future labour policy discussions across Europe.

Conversely, if the reforms create unintended consequences—such as increased healthcare strain or reduced employee morale—other governments may hesitate to pursue similar measures.