German employers paid 85.6 billion euros in sick leave remuneration in 2025

Expenditure breakdown and drivers

German companies paid a total of 85.6 billion euros in continued remuneration for employees on sick leave during 2025, according to a study by the employer-affiliated German Economic Institute (IW). The figure represents an increase from 81.2 billion euros paid in 2024. Nominal expenditures for sick pay have more than doubled over the past fifteen years.

With a total of 85.6 billion euros, nominal expenditures for continued payment of wages during sickness have more than doubled within a decade and a half.

The total expenditure calculation incorporates data published by the Federal Ministry of Labour regarding the social budget. The ministry reported 72.5 billion euros in gross wages paid during illness and maternity leave in 2025. To this baseline, the IW added an estimated 13.1 billion euros in employer social security contributions, calculated using a statistical model.

Digital reporting and absence statistics

The IW attributed the rising costs to multiple contributing factors across the German labour market. Regular wage increases automatically lift the statutory costs of wage continuation, while overall employment figures have remained high. In addition, general sickness absence rates have remained above the levels observed prior to the coronavirus pandemic.

The introduction of electronic certificates of incapacity for work in 2022 altered how sick leave is recorded. Under the digital system, employees no longer submit physical paper certificates to their employers, reducing the volume of lost notices. This procedural shift produced a statistically significant rise in recorded absence days. The institute noted that before 2022, some ill employees stayed home without submitting a formal medical certificate if their employer tolerated the practice, leaving those days uncounted in earlier official wage continuation statistics.

Workforce demographics and illness duration

Changes in employee demographics and the composition of diagnoses have extended average recovery periods. An aging workforce and an elevated incidence of psychological illnesses have contributed to longer individual absences from work.

Even though the share of all cases is barely five percent, they account for around 13 percent of all absence days due to usually protracted recovery.

Under German labour law, employers are required to continue paying regular remuneration for up to six weeks for a single illness within a calendar year. If an employee receives a sick leave certificate with a new and distinct medical diagnosis, a separate six-week payment period begins. For illnesses extending beyond the statutory six-week threshold, statutory health insurance funds assume payment responsibility through sickness benefits.

Assessment of first-day medical certificate rules

The German Economic Institute evaluated proposed statutory rules that would require employees to present a medical certificate starting on their first day of illness. The research paper expressed caution regarding the effectiveness and operational adoption of such a mandate.

The study concluded that companies are unlikely to apply first-day certificate requirements uniformly. Implementing strict submission mandates creates additional administrative work for corporate human resources departments. Furthermore, institute researchers noted that enforcing rigid certification rules could place unnecessary strain on workplace trust and cooperation between staff and employers.