Germany

Capital city: Berlin
Currency

Euro (€, EUR)

Language spoken

German

Population size

83,149,300

Payroll frequency

Monthly

VAT – standard rate

19%

GDP –  growth rate

1.425%

Employment law in Germany is not contained under a single law. Instead it is governed by statutory regulations codified in (among other laws) the German Civil Code, then furthermore governed by various federal acts such as the Part-time and Fixed-term Work Act, Employee Leasing Act, Holidays Act, Act on Maternity Protection and the Dismissal Protection Act. Furthermore, collective labor law through codetermination, trade unions and collective bargaining plays a role.

German employment law provides strong labor conditions and protections for employees, so employing people will generally be an important investment and commitment.

Temporary agencies are popular options for more flexible workforce arrangements. For these and many other reasons, the following are only guidelines in the broadest sense, and professional legal services are recommended when employing in Germany.

Employing in Germany requires employers to own a legal entity in the country and manage payroll, tax, benefits and compliance through their own in-country resources. The complexity of employment regulations in Germany makes full compliance with employment laws a burdensome process.

Remotepayroll will take care of payroll, tax, benefits and compliance so you can focus on what matters most — your people.

EU Blue Card

An EU Blue Card gives highly-qualified workers from outside the EU the right to live and work in an EU country, provided they have higher professional qualifications, such as a university degree, and an employment contract or a binding job offer with a high salary compared to the average in the EU country where the job is.

Germany has increased the minimum salary requirements for first-time applications and for renewals as well, as follows:

  • non-shortage occupations: from €55,200 to €56,800 annual salary
  • shortage occupations: from €43,056 to €44,304 annual salary

Taxes in Germany

Learn about employment taxes and how they affect your employees’ paycheck

Employer

  • 9.30% - Pension
  • 7.30% - Health Insurance
  • 1.525% - Nursing Care Insurance
  • 1.25% - Unemployment Insurance
  • 1.18% - Accident Insurance

Employee

  • 9.30% - Pension
  • 7.30% - Health Insurance
  • 1.525% - Nursing Care Insurance
  • 1.25% - Unemployment Insurance
  • 0.00% - Up to 9,000
  • 14.00% - 9,000 - 55,961
  • 42.00% - 55,961 - 265,327
  • 45.00% - Over 265,327

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