Last Update on
state: 19.6.2026, reading time approx. 2 min
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BAG: Unpaid wages trigger interest
A German employee successfully claimed interest on delayed wage payments after a misclassification dispute. The Federal Labor Court ruled that employers must pay interest if they wrongly withhold wages, even during legal uncertainty. The case involved a public-sector worker whose pay was corrected after years of underpayment.
Rechtsanwalt Thomas Meier-Bading
Ruling awards interest on delayed wages
Image: AI, Prompt: Thomas Meier-Bading
The Federal Labor Court (BAG) ruled on February 19, 2026 (Case No. 8 AZR 76/25) that employees can claim interest on delayed wage payments, even if the employer initially disputed the correct pay grade. This means workers who were underpaid for years may receive additional compensation for the delay. The case involved a public-sector employee whose pay was corrected after five years of underpayment.
The employer argued the delay was justified due to legal uncertainty about the correct pay grade. However, the court found that employers must pay interest if they wrongly withhold wages, even when the law is unclear. The ruling emphasizes that employers bear the risk of legal disputes over pay.
What happened in this case
A public-sector employee was paid according to a lower pay grade (EG 6) than she was entitled to (EG 9/9a). After years of legal disputes, her employer finally corrected the pay but refused to pay interest on the delayed wages. The employee sued for the interest, and the court ruled in her favor.
