What has long been discussed is now becoming a reality: the systematic - and in fact digital - recording of working time is becoming the standard. For many companies, this means more than just a new tool. It affects processes, responsibilities and, above all, the ability to provide evidence to authorities, courts and clients.
The legal basis: why the obligation is coming now
The European Court of Justice (ECJ ) laid the foundation for the current development with its ruling C-55/18 of 14 May 2019. At that time, the ECJ ruled that member states must oblige employers to introduce "an objective, reliable and accessible system for measuring daily working time". This judgement affects all employers in the EU - regardless of sector or company size.
The Federal Labour Court (BAG ) confirmed this case law in its ruling 1 ABR 22/21 of 13 September 2022 and clarified two key points: Firstly, that the obligation to record working hours already exists today. And secondly, that employers must record the daily working hours of all employees - not just overtime or extra hours. At the same time, the BAG made it clear that manual systems such as Excel lists are not sufficient if they are not objective, reliable and accessible.
What exactly will change for companies?
Digital time recording is becoming the new standard for one simple reason: only digital systems fulfil the high requirements for traceability, access and evaluation that authorities and courts now demand. Those who still rely on handwritten lists or simple tables not only risk legal uncertainty, but also expensive consequences.
The legislator does not prescribe a specific system, but rather defines a framework.
There are likely to beexceptions for small companies (the exact limit has not yet been finalised) and for companies bound by collective agreements, which can make their own arrangements.
The current legal situation in the DACH countries
🇩🇪 Germany: Already mandatory - digital implementation to follow in 2026
Germany does not yet have a definitive law that explicitly prescribes digital time recording. However, the EU directives and the case law of the ECJ and BAG are clear: the obligation to record working hours already applies today. Companies that fail to act now risk fines, legal disputes and problems during official audits.
The Financial Control of Undeclared Labour (Finanzkontrolle Schwarzarbeit) of the customs authorities already carries out regular checks. Violations of the obligation to keep records can be penalised with up to 30,000 euros per violation - and this is already based on current law.
🇦🇹 Austria: AZA-G favours digital records
In Austria, the Working Hours Recording Act (AZA-G) has been in force since 2019, which stipulates an obligation to record working hours. Although digital recording is not yet explicitly required, authorities are increasingly demanding digital evidence, for example for audits. In addition, many company agreements already provide for digital systems.
Experts expect the AZA-G to be adapted to EU legislation in 2026/2027, similar to Germany. Particularly important: all working hours - including overtime, breaks and working from home - must be recorded. Anyone who violates the requirements here can expect fines of up to 2,000 euros.
🇨🇭 Switzerland: ArG recommends digital systems
In Switzerland, the Labour Act (ArG) regulates the obligation to keep records - but so far only for overtime. A general digital obligation does not yet exist. However, SECO (State Secretariat for Economic Affairs) recommends digital systems to ensure complete documentation.
Discussions are currently underway to extend the obligation to all working hours - similar to the EU. Cantons can also issue their own regulations. Violations can result in fines of up to 10,000 Swiss francs.
Particularly affected: Project-orientated companies
For companies in which working time is directly linked to projects, budgets and billing, the digital time recording obligation poses additional challenges. Without a modern system, there is a risk of
- A lack of transparency in hours and budgets, which can lead to project losses and friction with customers.
- Late realisation of deviations, resulting in cost explosions.
- High coordination effort between HR and project management, resulting in inefficiency and errors.
- Increased risk during audits, which can result in fines or contractual penalties.
The solution lies in digitalisation: real-time overviews of project times, automatic warnings in the event of budget overruns, a central database for all departments and, above all, legally compliant documentation.
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Conclusion: Act instead of wait and see
The digital time recording obligation is coming - and it's coming fast. While the exact legal details are still being finalised in Germany, one thing is clear: "The question is no longer 'if', but 'how'."
Three key takeaways for companies:
- The obligation already exists today.
- Manual systems are no longer a safe haven - digital solutions are de facto mandatory.
- Acting now saves costs and risks - those who wait risk fines and legal disputes.