According to the Minimum Vacation Act (Bundesurlaubsgesetz – BUrlG), § 7(1):
General rule:
The employee has the right to determine the timing of their vacation (§ 7(1) BUrlG), and the employer must, in principle, comply with the employee’s preferred dates. (CMS Blog)
Sole exception:
The employer may reject or postpone the vacation request only if
there are urgent operational reasons (dringende betriebliche Belange), such as staff shortages in a critical period or an essential project that must be completed;
there are vacation requests from other employees that enjoy social priority (e.g. parents with small children). (anwalt.de)
If the employer refuses the vacation request due to urgent operational reasons:
They must substantiate and, in case of dispute, prove these reasons.
The employer also remains obliged to grant the vacation at a reasonable alternative date within the same calendar year, or during the carry-over period until 31 March of the following year (§ 7(3) BUrlG) (kanzlei-dieckmann.de).
Summary
The employer may not refuse vacation arbitrarily or merely in order to limit the employee’s options.
Refusal or postponement is only permissible when the company’s interests significantly and seriously outweigh the employee’s interest, or when there is a conflict with colleagues’ vacation requests that have social priority.
In all cases, the vacation must still be granted later within the statutory time frame.
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