This is a preview. Log in to read the full article. Don't have a log-in?

Learn more Request a demo

Germany: Pay and benefits

Original author: Karen Ullmann
Updating author: Dr Christian Ley

Summary

  • Pay rates are normally set by collective bargaining agreements, and employees may receive various bonuses on the basis of "company practice". (See Pay - general)
  • Wages must be paid monthly unless provided otherwise, and must be accompanied by a written statement. (See Payment of wages)
  • Save for certain exceptions, employers may not make deductions from wages. (See Deductions)
  • Male and female employees must receive equal pay for "like work". (See Equal pay)
  • A national minimum wage is set by statute, and sectoral minimum wage rates can also be set by collective bargaining agreements that are declared generally applicable, as well as statutory regulation. (See Minimum wages)
  • All employees must be insured under the compulsory state pension scheme if their monthly income exceeds a specified minimum, and all employees are entitled to demand that their employer pays a proportion of their wages into an occupational pension scheme. (See Pensions)
  • Employers are obliged to make social insurance contributions and to deduct employees' contributions and income tax from their pay. (See Income tax and social security)
  • There are various rules regarding pay for employees absent from work due to sickness or certain other reasons. (See Pay for employees not at work)