Work and Wages

Minimum Wage

Generally, there is no national statutory minimum wage in Germany at the moment, but in accordance to the reform, employers must pay minimum wages as from 1 January 2015 for nearly all employees in the amount of €8.50 per hour – see the so called minimum wage law (Mindestlohngesetz (MiLoG), 11 August 2014) (see Bundestag printed matter (Bundestags-Drucksache) 18/2010(neu) and Bundestag printed matter 18/1558). The minimum wage extends to the parties of collective agreements, but there are periods of transition (see § 24 MiLoG). Some exceptions exist for seasonal workers, youth, long-term unemployed, threshold workers and newspaper delivery person (see § 22 MiLoG).  Often wages are determined by collective agreements. Separate minimum wages exist for temporary workers (§ 3a Temporary Employment Act) and posted-workers (Posting of Workers Act), which take precedence over the rules of Minimum Wage Law, if the minimum wage under Temporary Employment Act is not lower than the minimum wage of Minimum Wage Law (§ 1 III MiLoG).

Minimum wages may be extended also by government decree to a whole branch in form of generally binding collective agreement. A collective agreement may be extended on the request of at least one party to the collective agreement to employees and employers who are covered by its scope but who are not members of the agreement concluding organizations, provided that a board of three representatives each of employers’ and workers’ umbrella organizations agrees. The agreement is extended yet in case that at least 50% of all employees are employed by employers bound by the collective agreement and it is considered to be in the public interest (see alsoBundestag printed matter 147/14). Through reforms in 2014 from 1 January 2015 the 50%-quorum is not necessary; from January 2015 a collective agreement can be extended at the joint request of the parties to collective agreements generally binding (see § 5 Collective Agreement Act).

The Act on the Determination of Minimum Working Conditions, which yet provides the possibility to set minimum working conditions, including wages, for sectors which are not, or only to a minor extent, covered by collective agreements, to become inoperative by the so called Tarifautonomiestärkungsgesetz from 11 August 2014 (see Art. 15 of this Act).

Wages agreed to between employers and employees that yet do not exceed two-thirds of the amount in the relevant bargaining agreement are deemed unfair and void; if this is the case, payments must be made according to the relevant bargaining agreement.

The Act on Minimum Pay does not apply to Amateurs in football and other sports, who receive pay for playing and its application on foreign truck drivers in transit operations in Germany has also been suspended.

(Minimum Wage Law; Collective Agreement Act §5; Posting of Workers Act §4, §7 and so on) (see for further information also;jsessionid=479FE1B2400A82AB94B9C4EF1C0E3F29.cae3;;

The current minimum wage rates can be found in Minimum Wage Section.

Regular Pay

In accordance with §614 of the Civil Code, remuneration is payable to the performance of services; is measured over a set remuneration periods, so it is payable after the expiry of each of the periods. Germany has no legislation concerning standard pay days in employment relationships however salaries are normally transferred into the employee’s account in the middle of the month or at the end of the month as written in employment contract or in collective agreement.

Wages tax, solidarity surcharge and, where appropriate, church tax, and also employees’ shares of contributions for social security insurance (healthcare and pensions insurance) and unemployment insurance are principally deducted from the agreed gross pay and transferred directly by the employer to the agencies responsible. Employer is required to inform the worker, through employment contract, the composition and amount of remuneration including supplements, allowances, bonuses and special payments, as well as other components of pay and their due dates.

(Sec. 612, 614 of German Civil Code; §§ 2, 1, 6, 10 of Law on notification of conditions governing an employment relationship (Nachweisgesetz) and so on)