Definition
A repayment clause obliges the employee to repay certain benefits provided by the employer – such as a Christmas bonus, recruitment bonuses or relocation costs – if they leave the company before the end of a specified period. Such clauses are only valid if they are clearly worded, if the length of the commitment period is proportionate to the benefit received, and if they distinguish between the employee’s voluntary resignation and dismissal by the employer. If a clause requires repayment even in the event of redundancy, it is generally invalid – and the employee does not have to repay anything.
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Classification under employment law
Clauses obliging employees to repay special payments (e.g. Christmas bonus, holiday pay) in the event of early departure are only valid if the length of the commitment period and the repayment terms are clearly and reasonably defined. The Federal Labour Court (BAG) scrutinises these clauses strictly in accordance with the law governing standard terms and conditions (§§ 305 ff. BGB).
Distinction from related terms
Reimbursement of training costs: The repayment clause forms the contractual basis for an obligation to repay. The reimbursement of training costs describes the specific application of this provision.
Reservation of voluntariness: A reservation of voluntariness excludes future claims. A repayment clause, on the other hand, establishes an obligation to repay benefits already received under certain conditions.
Practical tip
Does your repayment clause also cover the event of termination by the employer? If so, it is usually invalid – because you should not be required to repay the money for a departure that you did not cause.
