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Hire Employees in Germany
Hire in Germany compliantly without setting up a local entity. We manage employment contracts, payroll, tax compliance, and work permits, so you can hire your first German employee in weeks, not months.
Capital
Berlin
Currency
Euro (EUR)
Language
German
Min. Wage (2026)
€13.90/hour
Max. Working Day
8 hrs
Min. Leave
20 days
Minimum wage: €13.90/hour gross from 1 Jan 2026 (about €2,409/month at 40 hours), rising to €14.60/hour on 1 Jan 2027. Working day: up to 10 hours if the average stays at 8. Leave: 20 days on a five-day week. Sources: Average salary and minimum wage in Germany ·
§ 3 ArbZG ·
§ 3 BUrlG
WHY GERMANY
Why International Companies Are Hiring in Germany
Germany gives you access to one of Europe’s deepest pools of engineers, developers and technical specialists, in a market right at the centre of the continent. Its employment rules are detailed, and that puts some companies off.
In practice it works the other way round. Once your contracts and payroll are set up properly, Germany is one of the most predictable places in Europe to employ people.
Deep Specialist Talent Pool
Strong universities and Germany's dual vocational training system produce engineers, developers and skilled technicians who are hard to find elsewhere in Europe.
Central European Location
Bordering nine countries, Germany is a natural base for teams covering Germany, Austria and Switzerland, and the wider European market.
Clear, Written Employment Rules
Working time, leave and pay are set out in law. Once your contracts and payroll are set up correctly, there are very few grey areas.
Routes for Non-EU Talent
The EU Blue Card, skilled worker permits and the Opportunity Card make hiring from outside the EU a realistic option for many roles.
Time Zone Alignment
CET (UTC+1) is one hour ahead of the UK, shared with most of continental Europe, and overlaps with US East Coast mornings.
Europe's Largest Economy
A large home market and a strong industrial base, from automotive and engineering to software, pharmaceuticals and finance.
“What clients tell us again and again is that the talent is worth it. In Germany you find engineers, developers and technical specialists who are hard to hire anywhere else in Europe, and they usually want a long-term role rather than a quick move. Many of our clients start with one person here, often to be closer to customers in Germany, Austria and Switzerland, and build a team from there.”
— Asuka Obster, HR Consultant at ThisWorks
01 - TALENT MARKET
Germany: A Deep and Specialised Talent Market
Germany’s job market is spread across several strong regional hubs rather than one dominant capital. That matters when you hire: the best city for a software team is often not the best one for an engineering or finance role.
Top cities for recruitment
Berlin
Start-ups, software, e-commerce and the creative industries. A large international talent pool where English is widely used at work.
Munich
Automotive, mechanical engineering, insurance and big tech. Highly competitive for senior engineering talent.
Frankfurt
Banking, financial services and fintech, and home to the European Central Bank.
Hamburg
Media, logistics, maritime trade and a growing tech scene around one of Europe's biggest ports.
Stuttgart
Automotive, mechanical engineering and industrial research. A strong base for engineering and R&D hires.
Leipzig & Dresden
Microelectronics, logistics and a growing tech scene, often with lower salary levels than the western hubs.
Key industries
Automotive & Mobility
Mechanical Engineering
IT & Software
Chemicals & Pharmaceuticals
Financial Services
Logistics
Renewable Energy
Average gross monthly salaries in Germany (full-time, EUR, 2025)
| Group | Average gross monthly salary |
|---|---|
| Germany, all full-time employees | €4,851 |
| By region | |
| Western states | €4,961 |
| Eastern states | €4,121 |
| By gender | |
| Men | €5,046 |
| Women | €4,435 |
Average gross monthly earnings of full-time employees in 2025, excluding special payments such as holiday and Christmas pay. The gap between western and eastern states is about €840 a month, and the unadjusted gender pay gap is about 12%. Pay for a specific role depends on experience, industry, company size and city. For city and industry ranges, see our guide to average salary and minimum wage in Germany. Source: Federal Statistical Office (Destatis), average gross monthly earnings.
02 - HIRING OPTIONS
How to Hire in Germany: Your Three Options
There are three ways to hire people in Germany. The right one depends on how many people you plan to hire, how quickly you need them, and how long you expect to stay.
Hire Through an Employer of Record
Recommended for first hires- ThisWorks becomes the legal employer through our German company, ThisWorks EOR Services GmbH
- We hold an indefinite licence for employee leasing (AÜG), granted after several audits by the German authorities
- We issue the German contract, register the employee, run payroll and handle HR administration
- You decide the work, the targets and how the team runs
Best for: first hires, small teams and testing the German market
Our EOR service in Germany →Set Up Your Own GmbH
- At least €25,000 in share capital
- A notarised founding agreement and an entry in the commercial register
- Registrations with the tax office and social insurance bodies before the first payroll
- Payroll, HR and compliance run by your own team or an adviser
Best for: established teams with long-term plans in Germany
See our entity setup support →Engage Independent Contractors
- Only suitable for genuinely independent, project-based work
- If a contractor works like an employee, takes instructions and is part of your team, it can count as false self-employment (Scheinselbstständigkeit)
- The authorities can then claim social insurance contributions for past periods
- Either side can ask the German Pension Insurance for a formal decision on status
Best for: short, clearly defined projects
Sources: § 5 GmbHG · § 1 AÜG · § 7 SGB IV · § 7a SGB IV
| Employer of Record (ThisWorks) | Your own GmbH | Independent contractor | |
|---|---|---|---|
| Local entity needed | No | Yes, entered in the commercial register | No |
| Legal employer | ThisWorks EOR Services GmbH | Your GmbH | None: it is a services contract |
| Minimum share capital | None | €25,000 | None |
| Before the first hire | Contract, registrations and payroll set-up | Notarised incorporation, register entry, tax and social insurance registrations, payroll | A services agreement |
| Payroll, tax and social insurance | Run by ThisWorks every month | Run by your team or your adviser | No payroll; the contractor invoices you |
| Main risk | Low: German compliance is handled for you | Fixed cost and admin before you know the market | False self-employment if the role looks like employment |
| Best for | First hires, small teams, entering Germany | Established, long-term German teams | Short, genuinely independent projects |
Sources: § 5 GmbHG · § 7 SGB IV · § 7a SGB IV
Many companies start with an EOR and move to their own GmbH once the team in Germany is big enough to justify it. If you are comparing providers, read how an employer of record differs from a payroll provider.
03 - COMPLIANCE
Legal Requirements for Hiring in Germany
Hiring employees in Germany comes down to three things: the right to work, a contract that meets German formal rules, and correct registration with the tax office and social insurance from day one.
Work permits and visas
- EU, EEA and Swiss citizens can work in Germany without a permit.
- Non-EU nationals need a residence title that allows employment, such as the EU Blue Card or a skilled worker permit. Section 10 covers the main routes.
- UK nationals moving to Germany now follow the same routes as other non-EU nationals.
What the contract must include
German law lists the terms every employee must receive in writing. A contract drafted for another country rarely covers all of them, and missing terms can lead to fines.
What every employee must receive in writing
- Names and addresses of both parties
- Start date, and end date for fixed-term contracts
- Place of work
- Job title or a short description of the work
- Length of any probation period
- Pay: each component, how and when it is paid
- Agreed working hours, breaks, rest periods and shift system
- Whether overtime can be ordered, and on what terms
- Annual leave
- Any training the employer provides
- Company pension provider, if one is used
- Notice periods and the procedure for ending employment
- Collective or works agreements that apply
A written employment contract that covers all of these terms meets this requirement. ThisWorks issues one to every employee we employ in Germany.
Source: § 2 NachwG
Do you need a local entity?
Not if you hire through an Employer of Record. Employing someone directly means registering as an employer in Germany, running German payroll and social insurance yourself, and checking whether your activity creates a taxable presence (a permanent establishment) in Germany. Many companies set up a GmbH to manage that. With ThisWorks, our German company is the employer, so you can hire in Germany without either step. Learn about our EOR service in Germany.
04 - CONTRACTS
Contract Types & Probation Periods
Most employees in Germany are hired on permanent (open-ended) contracts. Fixed-term contracts are possible, but they have to follow strict rules, so it pays to set them up correctly from the start.
| Contract rule | What it means for employers |
|---|---|
| Permanent contract | The standard in Germany and the most common choice for ongoing roles. |
| Fixed-term contract | Possible for up to two years without a specific reason, or longer where the law recognises one, such as covering parental leave. The fixed term must be agreed in writing before work starts. |
| Probation | Up to six months, with two weeks' notice on either side. |
| Part-time work | Employees can ask to reduce their hours once they have worked for more than six months, if the employer has more than 15 employees. |
Sources: § 14 TzBfG · § 8 TzBfG · § 622 BGB
Other terms to check
Depending on the role and the business, a collective agreement or a works council can also shape working conditions. Some clauses, such as a non-compete that applies after the employee leaves, come with their own rules, including compensation. We take care of these when we draft the contract.
05- WORKING TIME
Working Hours and Breaks
Full-time hours are set in the employment contract or a collective agreement, often somewhere between 38 and 40 hours a week. Underneath that sit the legal limits, which apply to every employee.
The legal limits of a working day
One 24-hour day, under the Working Hours Act (ArbZG)
Hover over or tap each part of the bar for details.
- Up to 8 hours a working day
- Up to 10, only if the average stays at 8 over six months
- At least 11 hours' uninterrupted rest
30 min
break for more than 6 and up to 9 hours of work
45 min
break for more than 9 hours of work
Every minute
of working time must be recorded by the employer
Sources: § 3 ArbZG · § 4 ArbZG · § 5 ArbZG · Federal Labour Court, 1 ABR 22/21
Work on Sundays and public holidays is generally not allowed, with exceptions for sectors such as hospitality, healthcare and transport. There is no statutory overtime premium: whether and how overtime is paid depends on the contract or collective agreement, so the overtime clause matters.
06 — PAYROLL & TAX
How to Pay Employees in Germany: Payroll, Tax and Social Security
Employees in Germany are paid monthly, in euros, after the work is done. Each payroll run covers wage tax, solidarity surcharge and church tax where they apply, five branches of social insurance and a set of filing deadlines that do not move. This is where most first-time employers in Germany want support.
Minimum wage
Germany’s statutory minimum wage is €13.90 gross per hour in 2026, which works out at about €2,409 a month for a 40-hour week. It rises to €14.60 per hour on 1 January 2027. Collective agreements often set higher pay floors in specific sectors. For the full picture, including average salaries by city and industry, read our guide to average salary and minimum wage in Germany.
Wage tax and tax classes
Employers withhold income tax (Lohnsteuer) through payroll, using electronic tax data that the employee’s tax office provides. Every employee is placed in one of six tax classes, mostly based on marital status, and the class changes how much is withheld each month. Solidarity surcharge and church tax are added where they apply.
Social security contributions
Social insurance in Germany covers pension, unemployment, health, long-term care and accident insurance. Most branches are split equally between employer and employee, up to annual ceilings. The employee chooses their own statutory health insurer, and that insurer collects the full contribution for all branches except accident insurance.
Who pays German social insurance?
How each contribution is shared between employer and employee.
- Employer
- Employee
- Pension insurance Funds the state pension. Employer and employee each pay half of the contribution.
- Unemployment insurance Funds unemployment benefit and job support from the Federal Employment Agency.
- Health insuranceincl. the insurer's supplementary contribution Covers medical care and sickness benefit. The employee chooses their own statutory health insurer, which also collects the other social insurance contributions.
- Long-term care insurancechildless employees pay an extra surcharge themselves Covers care needs in old age or long-term illness. It is collected together with health insurance.
- Accident insurancepaid to the employers' liability insurance association Covers accidents at work, on the way to work and occupational illness. The rate depends on the risk level of the industry.
- U1, U2 and U3 leviessick pay, maternity and insolvency schemes Employer levies that fund the sick pay and maternity pay schemes and protect wages if an employer becomes insolvent.
Hover over or tap a row to see what each contribution covers.
Sources: § 168 SGB VI · § 346 SGB III · § 249 SGB V · § 58 SGB XI · § 55 SGB XI · § 150 SGB VII · § 7 AAG · § 358 SGB III
07 - EMPLOYEE RIGHTS
Employee Rights and Leave Entitlements in Germany
Leave in Germany is generous by law and often more generous by contract. Many employers offer more than the statutory minimum to stay competitive.
| Leave type | Statutory minimum | Who pays |
|---|---|---|
| Annual leave | 24 working days on a six-day week, which is 20 days on a five-day week. Many employers offer more. | Employer |
| Public holidays | Nine nationwide public holidays, plus extra days set by each federal state. | Employer |
| Sick leave | Up to six weeks' full pay per illness, once employment has lasted four weeks. Sickness benefit follows. | Employer, then the health insurer |
| Maternity protection | Usually 14 weeks: six weeks before the birth, when working is optional, and eight weeks after, when working is not allowed. Longer after premature or multiple births. | Health insurer, with an employer supplement |
| Parental leave | Up to three years per parent for each child. Up to 24 months can be taken between the child's third and eighth birthday. | Unpaid by the employer; parental allowance comes from the state |
Sources: § 3 BUrlG · Bundestag Drucksache 20/3615 · § 3 EFZG · § 44 SGB V · § 3 MuSchG · § 15 BEEG
Read our guide to maternity and paternity leave in Germany →Benefits: what the law requires and what the market expects
- Required by law: social insurance, paid leave, sick pay, and the employee’s right to put part of their salary into a company pension, with an employer top-up where the employer saves social insurance as a result.
- Common extras: Christmas or holiday pay, extra leave days, public transport subsidies, bike leasing and meal allowances.
- Not required: a 13th-month salary. It only applies if the contract, a works agreement or a collective agreement provides for it.
08 — ENDING EMPLOYMENT
Ending Employment in Germany
German law gives employees strong protection, and ending an employment relationship is a formal process. Notice periods grow with length of service, the notice itself has to meet strict formal rules, and some employees, such as those on parental leave, are given extra protection.
As the legal employer, ThisWorks manages this process on your behalf. If you are thinking about ending an employment relationship, talk to us first, before anything is said to the employee.
“No two situations are the same. The right approach depends on the contract, the person and what has happened, so there is no standard letter that fits every case. The best thing an employer can do is call us early. Then we can plan it properly together.”
— Asuka Obster, HR Consultant at ThisWorks
09 —INTERNATIONAL TALENT
Hiring International Talent in Germany
Germany has opened up its immigration rules for skilled workers in recent years. For many roles, hiring from outside the EU is now a realistic option, but the salary and qualification rules depend on the route.
For the full process, read how to get a work permit in Germany and our EU Blue Card Germany guide, or see our work permit and visa services.
EU, EEA and Swiss nationals can work in Germany without a permit. Everyone else needs a residence title that allows employment. These are the main routes for employers:
EU Blue Card
€50,700
gross a year in 2026
For university graduates with a job that matches their degree. A lower threshold of €45,934.20 applies to shortage occupations and to graduates from the last three years.
Key conditions
- A degree recognised in Germany, or comparable to a German degree
- A job offer that matches the qualification
- No Federal Employment Agency approval needed at the standard threshold
- A route to permanent residence after 27 months, or 21 months with B1 German
Skilled worker permit
No fixed salary
under 45
For candidates with a vocational or academic qualification recognised in Germany. The Federal Employment Agency checks that pay is in line with local terms.
Key conditions
- A qualification recognised in Germany
- Pay and conditions comparable to those of local employees
- Approval from the Federal Employment Agency, in most cases
- From age 45, a salary of at least €55,770 for a first permit, unless the candidate has adequate pension provision
IT specialists without a degree
€45,934.20
gross a year in 2026
For IT professionals with at least three years' relevant experience in the last seven years, even without a formal qualification.
Key conditions
- At least three years of IT experience at a level comparable to a university graduate, gained in the last seven years
- A salary of at least €45,934.20 a year
- Approval from the Federal Employment Agency
Opportunity Card
Job search
points-based
Lets qualified candidates come to Germany to look for work. Useful because some candidates may already be in the country when you meet them.
Key conditions
- Allows a stay of up to one year to look for work
- Holders can work part-time, up to 20 hours a week, while they search
- Candidates can do trial work for an employer for up to two weeks
- Once hired, the candidate switches to a work permit such as the EU Blue Card
Sources: Make it in Germany: minimum salaries 2026 · Make it in Germany: IT specialists from third countries · Make it in Germany: skilled worker immigration for employers (2026) · § 18g AufenthG · § 18a AufenthG · § 18b AufenthG · § 20a AufenthG · § 2 FreizügG/EU
10 - HIRING PROCESS
How to Hire Employees in Germany with ThisWorks
Once you have chosen your candidate, hiring through ThisWorks follows six steps.
-
Tell us about the role
Job, salary, start date and the federal state where the employee will work. You get a quote for the full employment cost.
-
We draft the German contract
A contract built for German law, covering every term the employee must receive in writing.
-
Right to work
For non-EU candidates, we help with the right residence permit before the start date.
-
Registrations
Health insurer, social insurance, electronic tax data and accident insurance, all set up before the first payroll.
-
Monthly payroll
Salary, wage tax, social insurance filings and payslips, every month.
-
Ongoing HR support
Leave, sickness, contract changes and, if it comes to it, a compliant end to employment.
Your start date usually depends on two things: the candidate’s notice period with their current employer and, for non-EU hires, the residence permit. We will tell you up front which one sets the pace.
“The paperwork behind a German hire is easy to underestimate. Before the first payroll we need the tax ID, the social insurance number and the employee’s choice of health insurer. If any of it arrives late, the first payslip is wrong. So we chase all of it before day one, and the first month runs like every month after it.”
– Beate Kussmann, Back Office Specialist at ThisWorks
11 - CHOOSING A PROVIDER
Why Hire in Germany with ThisWorks?
Choosing an EOR partner in Germany is about more than running payroll. You need people who know German employment law in practice, and who pick up the phone when something comes up.
Our Own German Company
Your employees are employed by ThisWorks EOR Services GmbH, under German law.
Contracts Built for Germany
Contracts and written terms drafted for German law from the start, not adapted from another country.
Payroll Run In-House
Our own payroll team handles wage tax, social insurance filings and payslips every month.
A Named HR Contact
A consultant who knows your team, not a ticket queue.
Work Permit Support
Help with the EU Blue Card and skilled worker routes for non-EU hires.
One Partner Across Europe
Hire in Germany and in other countries with the same team and the same process.
12 - HOW WE HELP
ThisWorks Services in Germany
Whatever stage of German expansion you’re at, we have a service built for it.
Employer of Record
Hire in Germany without a local entity. Contracts, payroll and HR handled by our German company.
Learn more →Payroll Services
German payroll, wage tax and social insurance filings, every month.
Learn more →Work Permit & Visa Services
Support for non-EU hires through the EU Blue Card and skilled worker routes.
Learn more →Entity Setup
For when you are ready to set up your own GmbH in Germany.
Learn more →13 - FAQS
Frequently Asked Questions
Can I hire employees in Germany without a German company?
Yes. An Employer of Record employs your team in Germany on your behalf. With ThisWorks, your employees are employed by our German company under a German employment contract, and we hold an indefinite licence for employee leasing (AÜG). We run payroll and HR administration while you manage the day-to-day work.
How long does it take to hire someone in Germany?
It depends mostly on the candidate. Many employees in Germany have a notice period with their current employer, and non-EU candidates need a residence permit before they start. Once those are clear, we set up the contract, registrations and payroll before the first day.
Is an employer of record legal in Germany?
Yes, as long as the provider follows German employment law and holds the right licence for employee leasing (AÜG). ThisWorks holds an indefinite AÜG licence, granted after several audits by the German authorities.
What is the minimum wage in Germany in 2026?
The statutory minimum wage is €13.90 gross per hour in 2026, about €2,409 a month for a 40-hour week. It rises to €14.60 per hour on 1 January 2027.
How much does it cost to hire an employee in Germany?
On top of gross salary, employers pay their share of social insurance, accident insurance, statutory levies and any benefits. The total depends on the salary, the employee’s health insurer and their personal circumstances, so we give you an exact figure for each role.
How many days of holiday do employees in Germany get?
By law, at least 20 working days a year on a five-day week. Many employers offer 25 to 30 days. On top of that, Germany has nine nationwide public holidays, and each federal state adds its own.
Do employees in Germany get a 13th-month salary?
Not by law. Christmas or holiday pay is common, but it only applies if the employment contract, a works agreement or a collective agreement provides for it.
Can I hire contractors in Germany instead of employees?
Only for genuinely independent work. If a contractor works like an employee, follows your instructions and is part of your team, the relationship can be treated as employment, with social insurance contributions payable for past periods.
Is there paternity leave in Germany?
Germany has no statutory paternity leave. Fathers can take parental leave (Elternzeit) and claim parental allowance (Elterngeld) from the state, and some contracts or collective agreements add paid days.
Do I need a work permit to hire in Germany?
Not for EU, EEA or Swiss nationals. Other nationals need a residence title that allows employment, such as the EU Blue Card or a skilled worker permit.
We're ready to support your expansion into Germany
Manager Backoffice / Payroll at ThisWorks
“Many companies are keen to hire in Germany because the talent is excellent, then slow down when they see how much is set out in law, from working hours to payroll deadlines. Once the contract, registrations and payroll are set up properly, everything runs smoothly month after month. With the right support from day one, growing a German team is very manageable.”
