Germany Labor Law Guide for Hiring Employees and Contractors
Minimum Wage
€12.41 per hour
Overtime Wage
125% of regular pay rate
Meal Breaks
30 minutes after 6 hours of work
Rest Breaks
15 minutes
Working hours
Maximum 8 hours/day, 48 hours/week
Salary Payment Cycle
Monthly
Payroll Taxes
Social Security, Health Insurance, Unemployment Insurance
Paid Vacation
At least 24 working days annually
Overtime Hours
Above 8 hours/day
Night Shift Hours
25%–100% premium on regular pay
Holidays
9–13 (depending on the federal state)
No Work Days
Sunday and public holidays
The cost of setting up a business entity varies, but the average is about €1,000–€2,000 for registration fees, notary costs, and legal advice. Incorporating a business typically takes between 1–3 months.
Employment contracts in Germany must be in writing and should include clauses such as job title, duties, salary, working hours, vacation entitlement, and notice period.
Germany makes a clear distinction between employees and contractors.
Employees are entitled to full labor law protections, whereas contractors have more flexible terms but lack such protections.
Germany has a federally mandated minimum wage law. As of 2024, the minimum wage is set at €12.41 per hour.
Exceptions exist for specific groups, such as apprentices or those undergoing internships that are part of a curriculum, where different rates or exemptions may apply.
Some federal states may set minimum wages for regional jobs or industries, but these are usually in line with or higher than the federal rate.
Employers are also required to pay employees for all public holidays.
Night shifts, typically between 11 PM and 6 AM, attract premiums ranging from 25% to 100% above the regular pay rate, depending on the employer and industry.
The minimum age for employment is 15 years, with strict regulations concerning the employment of minors to protect against child labor.
| Income Level (€) | Applicable Tax Rate (%) |
|---|---|
| Up to 9,744 | 0 |
| 9,745 – 57,918 | 14 – 42 |
| 57,919 – 274,612 | 42 |
| Above 274,613 | 45 |
- Paid Vacation: At least 24 working days annually.
- Maternity Leave: 14 weeks (6 weeks before and 8 weeks after childbirth).
- Paternity Leave: Up to 3 years (unpaid, shared with maternity leave).
- Sick Leave: Up to 6 weeks at full salary per illness.
- Adoption Leave: Same entitlements as parental leave following the official custody.
- Public Holidays: Vary between 9–13 depending on the federal state.
List of public holidays in Germany:
| Holiday | Date |
|---|---|
| New Year’s Day | January 1 |
| Good Friday | Varies |
| Easter Monday | Varies |
| Labor Day | May 1 |
| Ascension Day | Varies |
| Whit Monday | Varies |
| German Unity Day | October 3 |
| Christmas Day | December 25 |
| Boxing Day | December 26 |
- Pension Insurance: Equally shared by employer and employee.
- Healthcare Insurance: Split between employer and employee.
- Unemployment Insurance: Equally shared.
- Long-term Care Insurance: Equally shared.
- Annual Bonuses: Often industry-specific but not mandated by law.