The employer is entitled to reduce the annual holiday of an employee for any full month of parental leave on a pro-rated basis (Sec. 17 para 1 Federal Parental Benefit and Parental Leave Act). For such reduction of the holiday claim, the employer must unilaterally inform the employee thereof. This does not require a specific format or time line. However, please note that due to a recent ruling of the German Federal Employment Court from 19 May 2015, such declaration cannot be exercised after the termination of an employment relationship. It is recommended to notify the employee of the pro-rated reduction of holiday for the time of parental leave in the letter of the employer confirming the duration of parental leave. Otherwise, an unreduced holiday claim may have to be granted in kind or compensated at the end of an ongoing employment relationship.