Talent Wiki - Germany
Your quick guide on talent and labor compliance norms in Germany
Capital
Berlin
Currency
Euro (EUR)
Languages
Germany and English
Payroll Frequency
Monthly
GDP per Capita
$48,397.80
Employer Tax
20.015%
Talent Overview
Germany has the largest economy in the whole of Europe. Also, Germany holds the position of the 4th-largest economy by nominal GDP and the 5th-largest by PPP. The country holds the best and growing industries within years, having the largest domestic market in the EU.
Major economic hubs:
Berlin, Hamburg, Munich, Frankfurt am Main
Skills in demand:
Software developers, architects, programmers; Electrical engineers, Nursing professionals, IT Consultants, and analysts.
Local Universities
Top Local universities in Germany are:
Ludwig-Maximilians-Universität München
Ranking
Local: 1
World: 93
Freie Universität Berlin
Ranking
Local: 2
World: 104
Technische Universität München
Ranking
Local: 3
World: 115
Ruprecht-Karls-Universität Heidelberg
Ranking
Local: 4
World: 127
Ruhr-Universität Bochum
Ranking
Local: 5
World: 151
Salary Data
The table below provides the average salary data for Germany:
| Job Title | Average Monthly Salary (EUR) | Average Monthly Salary (USD) |
| Business Development Manager | 5,880 | 6237.74 |
| Accounting Manager | 5,670 | 6014.96 |
| Human Resources Manager | 5,400 | 5728.54 |
| Financial Analyst | 4,690 | 4975.34 |
| Project Manager | 4,630 | 4911.69 |
| Business Analyst | 4,390 | 4657.09 |
Talent Sourcing Tips
Top Local Job Boards
Indeed, StepStone, Arbeitsagentur
Number of LinkedIn users
14,430,000
Multiplier Recruitment Partner
Employing in Germany
Onboarding employees in Germany will require employers to have knowledge of employment laws, statutory regulations, benefits, leaves, and allowances. This section will have the necessary information on the items previously mentioned.
Employee Contract
According to the German statutory laws, employment contracts are mandatory and to be provided by the employer with one month of employment. This contract will include all the information about the terms and conditions along with the benefit details to the employee. Employment contracts may be in any language but a German translation must always be provided and readily available.
Public and Provincial Holidays 2023
| Date | Name | Type |
| 1 Jan | New Year’s Day | National holiday |
| 7 Apr | Good Friday | National holiday, Christian |
| 10 Apr | Easter Monday | National holiday, Christian |
| 1 May | Labor Day | National holiday |
| 18 May | Ascension Day | National holiday, Christian |
| 29 May | Whit Monday | National holiday, Christian |
| 3 Oct | Day of German Unity | National holiday |
| 25 Dec | Christmas Day | National holiday, Christian |
| 26 Dec | Boxing Day | National holiday, Christian |
Employee Leaves
| Type of Leave | Duration | Mandatory |
| Annual Leave | 24 to 30 days | Yes |
| Sick Leave | 11 days | Yes |
| Maternity Leave | 14 weeks | Yes |
Payroll
Payroll Cycle
According to Germany Statutory laws, the payroll cycle is Monthly.
Minimum Wage
The minimum wage in Germany is 12 EUR per hour.
Overtime Pay
The standard working hours in Germany are 8 hours per day and 48 hours per week. Overtime pay is to be determined by the employer.
Bonus
13th Month Pay
There are no laws for 13th-month pay. The employer can determine to pay in mutual agreement.
Employee Benefits
- Social Security
- Healthcare and Insurance
- Maternity and Paternity leave
- Pension Scheme
- Unemployment Insurance
Taxes
Employer Payroll Tax
| Type of Contributions | Contributions |
| Pension Insurance | 9.3% |
| Unemployment Insurance | 1.2% |
| Health Insurance | 7.3% |
| Long term care insurance | 1.525% |
| Insolvency Contribution | 0.09% |
| Specific Supplementary Contribution | 0.60% |
| Work Accident Scheme | Depending on the type of industry, the employer has to contribute. |
Employee Payroll Tax
| Type of Contributions | Contributions |
| Pension Insurance | 9.3% |
| Unemployment Insurance | 1.2% |
| Health Insurance | 7.3% |
| Long term care insurance | 1.525% |
| Specific Supplementary Contribution | 0.60% |
| Church Tax | 0% – 9% |
Employee Income Tax
| Annual income for Single Earning member (EUR) | Annual income for Married Earning member (EUR) | Tax Rate |
| 0 – 10,347 | 0 – 21,264 | 0% |
| 10,632 – 61,971 | 21,264 – 123,942 | 14%-42%* |
| 61,971 – 277,825 | 123,942 – 555,650 | 42% |
| 277,825 and above | 555,560 and above | 45% |
*The taxable rate starts from 14% and progressively increases to 42%.
VAT
The Standard rate of Value Added Tax in Germany is 19%.
Offboarding & Termination
The employer has to provide a valid reason for termination of the employment. Moreover, after 6 months of employment, the employee is protected by the German Termination Protection Act. According to this act, an employee can be terminated based on the following categories;
- Personal situation (e.g., Long term Sickness)
- The behavior of the individual (e.g., fraud, theft)
- Business of the employer (if the employer decides to decrease the number of employees)
Four weeks of the notice period is mandatory for the employee. However, the number of days increases with years of service.
| Years of Service | Notice Period |
| Below 2 years | 4 weeks |
| 2 years to 5 years | 8 weeks |
| 5 years to 8 years | 12 weeks |
| 8 years to 10 years | 16 weeks |
| 10 years to 12 years | 20 weeks |
| 12 years to 15 years | 24 weeks |
| More than 15 years | 28 weeks |
There are no statutory laws for severance pay. However, the employer has to give severance pay if the employee was terminated without notice.
Visa and Immigration
A Long term visa is mandatory for any individual. If the individual has an employment offer based in Germany, they can avail of a work permit and residence permit. However, the following countries can directly apply for residence permits in Germany;
- EEA and EU Members
- Canada
- Israel
- Australia
- Japan
- New Zealand
- Korea
- Switzerland
