Employer Payroll Tax
Employee Payroll Taxes
Employee Income Tax
Minimum wage in Germany is €9.35 per hour.
Salaries are paid monthly at the end of the month, typically around the 25th.
A work week varies between 38-40 hours. Workdays are typically 8 hours and should not exceed 10 hours.
Overtime payment is only required when stated in employees’ individual contracts or collective labor agreements.
Employers contribute 20.55% of workers wages. Employees contribute 19.37% of their salary.
› First pillar: mandatory state pension insurance (gesetzliche Rentenversicherung). This is part of the basic social security system. All employees and employers pay a percentage of salaries into this system (about 9.5% dependent on the region). › Second pillar: voluntary occupational pension insurance. › Third pillar: private insurance. Common practice for private insurance is monthly employee contribution of up to 4% their gross salary and employer contribution of 4% of the gross salary by standard plus half the percentage of the employee’s contribution (maximum 6% employer contribution in total).
German holidays differ based on the state. However, there are 9 national holidays that all states follow.
Mothers are entitled to 6 weeks leave at full pay prior to their child’s birth, and eight weeks at full pay after birth. In the case of premature or multiple births, 12 weeks paid leave is permitted. After six weeks the insurance provider will cover the fees.
Paternity leave falls under the parental leave.
Parental leave is leave of 36 months till the child turns three. This leave can be divided as chosen between the parents. The eight weeks of maternity leave is counted towards this. During parental leave, parents can choose to work part-time up to 30 hours per week.
Termination is monitored by the German Employment Protection Act (Kündigungsschutzgesetz) and provides protection to employees by ensuring dismissals are justified.
An employer must notify the employee with a written notice 4 weeks prior. If the employee has been in the company for over 20 years, the termination notification period becomes 7 months.
Severance payment is not mandatory if a justified reason and proper notice is given for the termination. However, severance payment must be given for termination caused by operational changes. When severance payment is given, it is a half month of the employee’s regular wage for every year the employee was in the company.
19% standard rate.