Current Region & Language
Current Region & Language
Current Region & Language
Currency
Euro
Employer Taxes
Approximately 24-28% of gross salaries, mainly for social security.
Payroll Frequency
Monthly
Language
German
Date Format
DD/MM/YYYY
Germany By The Numbers
84 million
Population
EUR 4.2 trillion
GDP
9
National Holidays
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Weekly Working Hours
National Holidays
Leave
In Germany, employees are entitled to various types of leave, including sick leave, maternity leave, and parental leave. Employees can also take care leave for relatives in need of care, as well as family care leave for personal or family matters. Special leave is provided for events such as marriage, the birth of their own child, the death of close relatives, or relocation. Additional leave may be granted in cases of severe disability or for educational purposes. In certain situations, employees may be entitled to further leave as specified in individual cases or collective bargaining agreements (CLA), which may provide for additional types of leave.
Employment Contracts
Employers are required to provide written employment contracts and policies that outline the terms and conditions of employment, including job responsibilities, compensation, benefits, and workplace expectations, in compliance with applicable labor laws.
Types of Employment
Employees, temporary agency workers, and independent contractors are all recognized types of employment.
Employment Costs
Total employer costs ranges from 24.45% to 28.09% (inclusive among others of Employer Social security, workers compensaiton insurance, maternity insurances). For specific insurances German employer costs can cap at high salary rates.
IC Class Factors
A status assessment is a comprehensive process that takes into account various factors, requiring a totality approach to determine the correct classification. Key considerations in this assessment include the degree of control exercised over the individual, their level of subordination, exclusivity in the working relationship, the economic risks borne by the individual, their integration into the organization, the potential for subcontracting work, and the right to substitution.
Labor Leasing
The placement of contingent or temporary workers at third party sites requires a labor leasing license.
Minimum Wage Requirements
Every two years, an independent commission of the collective bargaining partners, the Minimum Wage Commission, proposes to the federal government the level at which the minimum wage should be adjusted. The commission examines which minimum wage level offers appropriate minimum protection for employees, enables fair competitive conditions and does not jeopardise employment. It bases its decision on the development of collectively agreed wages in Germany. From 1 January 2025, it increased to 12.82 euros per hour. There is also a special hourly minimum wage for temporary work: On 1 March 2025, the minimum wage for temporary workers will increase to €14.53 per hour.No temporary worker may be assigned by a temporary employment company to an end client for less than this minimum wage.
Medical Benefits
In Germany, employees who are absent from work due to illness or are undergoing treatment are entitled by law to receive 100% of their salary for up to 6 weeks, provided that the employment relationship has lasted at least 4 weeks. However, this entitlement ends when the employment relationship concludes.
Probationary Periods
Probation periods are defined in the employment agreements, with the maximum duration typically being 6 months. During this period, both the employer and employee assess the suitability of the employment arrangement.
Termination Notice
During the agreed probationary period, which can last up to six months, the employment relationship can be terminated with two weeks’ notice. Collective agreements may, however, allow for shorter notice periods during this period. Once the probationary period ends, the notice period for termination by the employer is four weeks, effective either on the fifteenth or the end of the calendar month. If the employment relationship has lasted longer, the notice periods increase according to the length of service. For example, after two years of employment, the notice period is one month, ending at the end of a calendar month. After five years, the notice period increases to two months; after eight years, it becomes three months; after ten years, four months; after twelve years, five months; after fifteen years, six months; and after twenty years, the notice period extends to seven months, all ending at the end of a calendar month.
Severance
With a few specific exceptions such as in cases of discriminatory termination, the employee is not legally entitled to severance pay. In theory, a claim for severance pay can only be made if both the company and the employee have approved its payment.
Collective agreements may provide a minimum pay in the event of termination due to a change in the operation.
Legally speaking, there is no statutory termination pay. The termination is either valid or it is not.
However, in most cases, dismissal protection proceedings end in a termination/ settlement payment. The amount depends on whether the termination would likely be valid.
For each year that the work relationship has been in place, the payment is equal to half of the monthly compensation (accounting for all components of the salary); any duration longer than six months is rounded up to a full year.
Pre-hire Checks
Background checks are generally not permissible due to strict data protection laws (GDPR, BDSG).
Exceptions may apply in cases in which the information gained from the checks is necessary to assess a candidates suitability for the position, such as financial background checks may be deemed necessary for a cashier or banker and criminal background checks necessary for a kindergarten teacher or a youth worker.
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