German employment law is governed by many separate laws and to a large extent by case-law. There is no unified law regulating the relationship between employer and employee, but rather separate laws for particular issues – i.e. the Federal Vacation Act (BUrlG), the Hours of Employment Act (ArbZG) or the Maternity Protection Act (MuSchG). Most provisions in German employment law require interpretation when applied to a specific case. The labour courts perform such interpretation and sometimes even establish general principles not expressly included in statutory law. Case-law is therefore of very high importance. As German employment law mainly serves the purpose of protecting the employees, the interpretation of the labour courts is mostly employee-friendly. We have outlined the most important legal requirements to be observed when employing employees in Germany below.
A. WORKPLACE REQUIREMENTS
Employers are obliged to provide a healthy and safe workplace to their employees. If the employer does not fulfill the rules of occupational safety, the employees are entitled to refuse to work at an unsafe workplace without losing their claim to remuneration for such time. Furthermore, employees are entitled to demand that health and safety regulations are observed in the future and may claim compensation for any damages incurred. The fulfillment of the applicable health and safety regulations are monitored by the German administrative authorities.
B. HIRING PRACTICE
During the hiring process, the potential employer must be aware that not all questions are permissible in a job interview. In general, the potential employer may require any information relating to the applicant’s qualifications necessary for the open position. However, questions concerning e.g. pregnancy or family planning, religion or severe disability are generally not allowed in a job interview. If such questions are asked, the employee is entitled to refrain from answering or offering an untruthful answer and the employer cannot base any adverse legal measures on this.
Another important aspect to be considered during the hiring process as well as during the employment is the German General Equal Treatment Act (AGG), which aims to abolish unequal and unjustified treatments of employees based on certain criteria, such as ethnic origin, gender and age. Therefore, to avoid possible discrimination issues, the employer should always base the rejection of an applicant on objective hiring criteria such as job profile and required qualifications. Applicants who are rejected based on discriminatory criteria may claim compensation in the amount of up to three monthly salaries of the position they applied for. Due to such potential discrimination claims, the employer is entitled to store personal data of the rejected applicant for 3-6 months after the end of the recruitment process. Beyond this period, personal data of the applicant may only be stored in case of the applicant’s explicit permission.
C. EMPLOYMENT CONTRACTS
The general terms and conditions of employment are regulated to a large extent by statutory law, collective bargaining agreements concluded with the unions and agreements with the employee representatives at company level (works council), if in place. As a general rule, the employment contract may not deviate from these provisions to the detriment of the employee. The employer is obliged to provide the main contractual terms in writing to the employee no later than one month after the commencement of the employment. Therefore, employment contracts in written form are very common and certainly recommended. When the employment contract is preformulated by the employer and not negotiated with the employee clause by clause on an individual basis, the contractual provisions are subject to court review, if challenged by the employee. In particular, clauses that are considered an unreasonable disadvantage to the employee will be considered null and void.
D. WORKING CONDITIONS
Employees in Germany are entitled to a minimum of 20 working days of paid leave per calendar year, based on a five-day workweek. However, most employees are usually granted 25 to 30 days of holiday per calendar year, depending on seniority and the type of business.
The statutory maximum working time is 8 hours per day from Monday to Saturday. Working on Sundays and public holidays is generally forbidden. However, under certain prerequisites the regular daily working time may be extended to up to 10 hours. Furthermore, an uninterrupted rest period of 11 hours after daily work must be guaranteed. The law allows for certain deviations through collective bargaining agreements.
As a general rule, remuneration is determined by mutual agreement. However, since 1 January 2015 a minimum wage is in force. It currently amounts to 8.84 EUR gross per hour and is reviewed every two years. The next possible increase of the minimum wage would take effect on 1 January 2019. The minimum wage generally applies to all employees in all sectors of business, with some exceptions, e.g. for employees under 18, trainees and interns.
Please further note that the employer is obliged to pay contributions to the social security in addition to the employee’s gross salary and is responsible for deducting the income tax from the gross salary. Therefore, all employees must be registered with social security and the tax authorities. The employer must further pay contributions to the statutory accident insurance.