Facts & figures

Government Type: Federal Parliamentary Republic

Capital: Berlin
Currency: Euro

Languages: German

GDP Per Capita: 46,445 (2019)

Main Business sectors: 68.6%

Industry: 30.7%

Agriculture: 0.7%

Employment Rate: 69.73%

Employment Manual - Germany

The employment contract is signed for an unlimited period. A fixed-term contract is possible, provided the term is agreed upon in writing before the employment commences. A fixed-term contract ends automatically without written notice at the end of its term.  The agreement must refer to:

  • Role description
  • Contract duration
  • Probation or trial period
  • Working hours
  • Salary
  • Bonuses
  • Additional benefits such as a company car or mobile phone
  • Holiday leave
  • Company pension scheme
  • Conditions of contract termination
  • Collective bargaining or company agreements (if applicable)
  • Working location & travel expectations (e.g. if working for an international company)


Termination Process: The employer may terminate the contract of employment by either giving either an ordinary notice of termination observing the relevant notice period, or by an extraordinary termination with immediate effect.

Notice Period: The statutory notice periods in Germany are ruled by article 622 German Civil Code. The basic notice period is 4 weeks effective as of either the 15th or at the end of the calendar month.

Severance Pay: In practice, employer and employee shall agree on a severance payment to avoid a possible dispute regarding the question on whether or not the employer has just reasons for a termination, and it is common to start negotiations on the basis of a calculation of 50 % of a monthly salary per year of service with the company.

Payroll Taxes

In Germany, expats working can participate in the German pension system if they meet the eligibility criteria.

Employee Payroll Taxes

Income tax rates range from 14% to 45%. However, wages lower than €8,652 per year may be eligible for a tax exemption.

Mandatory Employee benefits

  • Full time employees in the Netherlands are legally entitled to a minimum of 20 days of paid holiday leave per year.
  • Part time employees are entitled to 4 times the number of hours they work per week.
  • In practice, most employers give more holidays, with between 27 and 30 days annual leave (excluding public holidays) being very common.
  • You can be sick for up to 6 weeks of continuous sick leave period in Germany and receive 100% of the salary.
  • In the event it’s a different illness, the 6-week period will start again from zero.
  • Public Holidays: There are 10 Public holidays in Germany
  • Pregnant employees are entitled to 6 weeks pregnancy leave before the baby is born and at least 8 weeks of maternity leave after childbirth.

Specific Employee Benefits and Industry Benchmarks

Legal entitlement to time of  work given to both father and mother. During this period, parents may also apply to claim the parental allowance (Elterngeld) to alleviate loss of earnings. 

Parental leave requirements:

  • Being employed (including part-time and temporary contracts, but not anyone who is self-employed).
  • Living together with your child in one house.
  • Caring jointly for the child yourself.
  • Working no more than 30 hours per week while taking parental leave.

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