Germany
Keep your business legally secure in Germany with Lerio's accurate and timely legislative insights.
Hiring in Germany at a glance
€ / EUR
40 hours / week
8 holidays / year
The most common payment frequency is monthly.
By law there is no legislative payment frequency.
German
83M
€12.41 / hour
1st Jan – 31st Dec
Employment Tax
- Social Insurance: 19.55%
- Pension: 9.30%
- Health Insurance: 7.30%
- Nursing Care Insurance: 1.7%
- Unemployment Insurance: 1.25%
- Income tax: based on your income and other factors, see below.
- Church tax: 8% – 9% (applicable if you attend church)
- Solidarity fund: 5.5%
- Social insurance: 19.60%
- Pension: 9.30%, capped at €7 550
- *Health insurance: 7.30, capped at €59 850 annually
- Long-term care: 1.70%, capped at €4 987.50
- Unemployment insurance: 1.30%, capped at €7 300
- Sickness/maternity leave allocation 2.75%
- Insolvency fund: 0.06% .
- Workers compensation insurance: around 1.6%
* Those who earn €66 600 or below annual salary must be insured by a government entity while those above can decide between public or private medical insurance.
Income tax
| Taxable salary (Single taxpayer) | Taxable Salary (Married taxpayer) | Tax Rate (%) | |
| €0 - €10 908 | €0 - €21 816 | 0% | |
| €10 909 - €62 809 | €21 817 - €125 618 | 14% for lower end and rises to 42% at the upper end | |
| €62 810 - €277 825 | €125 620 - €555 650 | 42% | |
| €277 826 + | €555 650 + | 45% |
Employer of Record
in Germany
As the recognized employer entity, an Employer of Record ensures strict adherence to all legal requirements pertinent to employment in Australia. This includes overseeing payroll processes, fulfilling tax obligations, and providing employees with accurate documentation as per labor laws.
Employer of
Record Process
- Company
- Full legal name of prospective employee
- Employee contact details
- Employee nationality and residency status
- Proposed start date
- Right to work status
- Job title
- Working hours
- Job description and deliverables
- Salary information
- Benefit information
- Intellectual property and confidentiality agreement
- Terms of termination (e.g. notice period)
- Probation period
- EMployee bank details
- All other company-specific requirements (e.g. non-compete, intellectual property clauses, etc.)
Finds their perfect hire and provides Lerio with all the information required to prepare an employment agreement. For Australia, that includes:
- Lerio
Prepares the employment agreement and shares with the prospective employee for signing. Requests all additional documents such as identity documents, proof of right to work in Australia, tax information, etc.
- Employee
Signs employment agreement and submits required documents.
Umbrella Process
- Employee
Now no longer a prospective employee but simply an official employee, who ensures to keep Lerio updated on any personal information changes.
- Lerio
Onboards employee to payroll and benefit programs to get started ensuring that salaries are paid every month and benefits are administered. Tax contributions and benefit fees are paid and payslips are provided to the employee.
Lerio provides an invoice and statement to the company for each month.
- Company
Receives monthly invoice, reviews and processes. Provides information on whether anything has changed in their relationship with the employee, the employee’s role or the company that will have an effect on the upcoming payroll run.
Employee Benefits
- Pension
- National health insurance
- Unemployment insurance
- Long-term care
- Workers compensation insurance
Non-mandatory
Employee Benefits
- Annual bonus/13th cheque
- Additional time off
- Flexible work
- Housing subsidy
- Company pension
- Public transport
- Life insurance
- Incapacity of work insurance
Employee Rights
- A safe and healthy work environment free from risk, both physically and psychologically
- Protection from discrimination, harassment and bullying
- Fair and just dismissal
- Protection of personal information
- Right to join a labour union
Leave
20 days off annually after 6 months of employment
First 6 weeks: fully paid leave,paid by the company after 4 weeks of employment.*
After 6 weeks: 70% of standard salary paid by health insurance.
6 weeks of paid sick leave after 4 weeks of employment. Full salary for 6 weeks. After that employees are paid 70% of their salary directly from health insurance.
* If a company has 30 or less employees they can claim up to 80% that they paid out back
14 weeks paid leave, 6 of which is before birth and 8 weeks after. Payment for maternity leave is split between the company and the health insurance company.
No statutory leave entitlement
3 years available until the child turns 3. 1 year of which can be saved to use between the ages of 3 – 8. 65% of the employee’s salary will be paid by the government.
3 – 5 days for urgent family responsibilities
2 days for the death of a close relation
Short term: Unpaid, up to 10 days and long term: unpaid, up to 6 months
- During probation: 2 weeks
- 2 years: 1 month’s notice
- years: 2 months’ notice
- 8 years: 3 months’ notice
- 10 years: 4 months’ notice
- 12 years: 5 months’ notice
- 15 years: 6 months’ notice
- 20+ years: 7 months’ notice
Probation
Maximum probation period is 6 months but is not mandatory
What is a work permit in Germany?
Technically, it doesn’t exist in Germany. Instead Germany makes use of only work visas and residence permits to qualify people to love and work in Germany. Germany has a variety of short and long-term visas that fill the needs of different type of work non-citizens may need to do in Germany. In combination with the specific work visa, a residence permit also has to be applied for which serves much like work permits do in other EU member states.
Who needs a work permit in Germany?
Germany requires everyone who is not a citizen or a permanent resident to go through a process of obtaining legal right to work, with certain exceptions:
EU member state citizens: All EU citizens have the right to work in another EU member state. They may however need to register their presence in the country (if staying for three months or less) or register your residence (staying for longer than three months). Germany is an EU member state and therefore EU member state citizens don’t need to obtain any documents to prove their right to work and live in Germany. They are required to register their residence in Germany to receive a certificate of residence when staying for longer than three months.
Iceland, Liechtenstein and Norway: As members of the EEA (European Economic Area), Iceland, Liechtenstein and Norway citizens have the same rights as any EU member state citizen to work and live in Germany. They are required to follow the same process as EU citizens as described above.
Switzerland: Though not a part of the EU or the EEA, the EU has an agreement with the Swiss government that allows a mutual freedom of movement. This affords Swiss nationals the same rights as any EU citizen to work and live in Germany. They are required to follow the same process as EU citizens as described above.
Therefore, anybody who is not a citizen of an EU member state, Iceland, Liechtenstein, Norway or Switzerland needs to go through the process to obtain a legal right to work.
*UK citizens: Please see here to understand the rights of UK citizens who settled in Germany prior to Brexit.
Who needs a work permit in Germany?
Residency permits take about two to three weeks to be processed and visas about fifteen days. Unlike with other countries, these can be done at the same time as you don’t need to wait for the permit to apply for the visa.
Types of work visas in Germany?
Work visa for qualified professionals
This visa is available to individuals who are highly qualified in their field.
Eligibility
- Offer of employment from a German company
- Relevant degree and other necessary qualification
- Salary must meet minimum specification
Visa for professionally experienced workers
This visa is available for those who have extensive professional experience and qualifications
Eligibility
- Offer of employment from a German company (Declaration of Employment)
- Minimum 2 years of experience in the last 5 years relevant to the role
- The role is not in a regulated profession
- Minimum salary must be above the specified amount
EU Blue Card
The EU blue card is a combined work and residency permit available to highly skilled individuals. It allows holders access to live and work in 25 out of the 27 EU member states (Denmark and Ireland not included).
Eligibility
- Bachelors or higher degree, some states accept 5 years of relevant experience without a degree
- Must be a salaried employee, not self-employed
- Annual salary must be at least 1.5 times the average national income of the state applying for
- Offer of employment
- Health insurance
Country-specific requirements and application processes can be seen here.
Application process in Germany
Apply for a visa
- Start the application on the local consulate or embassy website through their online portal.
- Complete the required information on the portal and submit any documents requested
- Attend the appointment where you,
- Submit additional documentation
Record biometric information - May have a short interview
- Submit additional documentation
- Applicant will be notified about the outcome
- If approved, visa can either be collected or be delivered
Applying for a residence permit
- After arriving, submit an application and book an appointment with the local Foreigners Authority
- Go to the appointment with the required documentation
- The application will be shared with the Public Employment Authority to approve
- Once approved, collect the residence permit
What documents are required to apply for a work permit in Germany?
Visa application
- Completed visa application
- Two passport photos
- Offer of employment in this form Declaration of Employment
- Proof of qualifications and experience
- Valid passport
- Return flight information
- Accommodation information
- Proof of health insurance
- Proof of finding
- Itinerary
Residence permit
- Completed application form
- Two passport photos
- Valid passport
- Proof of health insurance coverage
- Employment agreement (unless applying as job seeker)
- Evidence of academic qualification and resume
- Proof of annual salary
- Evidence of knowledge of German language if required for the role
- Criminal record check
Contact Us
If you have questions - feel free to ask them. We are happy to help our clients.