--- title: "Hiring in Germany 2026 | Employer of Record Guide" description: "Hire in Germany through Teamed's EOR via our own German entity. Minimum wage EUR 13.90/hour, around 21 to 22 percent employer social security, 20 statutory leave days, notice under section 622 BGB. The Germany guides, one per layer." canonical: https://www.teamed.global/country-hiring-guides/germany --- Germany · Country overview Served by Teamed-owned entity: Teamed GmbH, Berlin # What do you need to know to hire in *Germany*? Germany requires a written contract in the first week, social-insurance registration before day one, and notice that climbs to seven months with tenure. The minimum wage is EUR 13.90 an hour, statutory leave is 20 days, and employer social security runs around 21 to 22 percent on top of gross. Each guide below takes one layer. Last reviewed 16 June 2026 · Germany guide ## How does Teamed handle German hiring for you? Teamed becomes your legal [employer of record](/lp/employer-of-record) in Germany for [**from $599 per employee per month**](/pricing), with **zero FX mark-up** in any currency. Payroll, the German employment contract (Arbeitsvertrag), social-insurance registration, and the full compliance stack run on **one platform**. **Real HR and legal experts** manage every German hire, from the first offer letter to the final Lohnabrechnung. **An actual person**, not a chatbot or a pooled queue, handles your German team alongside EOR, contractor onboarding, and entity payroll on **one platform**. There is **no setup fee** and **no exit fee**. Employer cost **passes through at cost, itemised** on every invoice. A German contractor who converts to employment keeps their record, and that same employee can **graduate** from EOR to your own German GmbH without re-onboarding. Run the [Crossover Calculator](https://www.teamed.global/tools/crossover-calculator) to see the month the model flips. EOR is the right model for a first German hire, **until it isn't**. Three things US buyers underestimate about hiring in Germany - **Notice climbs to seven months, and runs to fixed dates.** Statutory notice under section 622 BGB starts at 4 weeks but rises with tenure to 7 months, and it runs to the 15th or the end of a calendar month. A flat four-week assumption understates the real exit cost. [The termination guide](/country-hiring-guides/germany/termination-and-severance) has the full schedule. - **Dismissal is not at-will once you pass ten staff.** After 6 months of service in an establishment with more than 10 employees, the Kuendigungsschutzgesetz (KSchG) requires every dismissal to be socially justified. [The compliance guide](/country-hiring-guides/germany/compliance-and-day-one-rights) covers dismissal protection and works-council rights. - **Hiring direct can create a taxable presence.** A direct hire who negotiates or concludes contracts for you can trigger a permanent establishment (section 12 AO), and misclassifying a contractor (Scheinselbststaendigkeit) brings back-payments. [The permanent establishment guide](/country-hiring-guides/germany/permanent-establishment-risk) and [the misclassification guide](/country-hiring-guides/germany/misclassification) set out the line. Answer.cite this Hiring in Germany adds roughly 21 to 22 percent of gross salary in employer social security: pension, health, long-term care, unemployment, and accident insurance. The statutory minimum wage is EUR 13.90 an hour in 2026. Statutory paid leave is 20 working days on a five-day week. Continued pay in sickness is six weeks at full salary. Notice and dismissal are governed by section 622 BGB and the Kuendigungsschutzgesetz. Teamed runs German payroll, contracts, and compliance through its own German entity, Teamed GmbH in Berlin. This page is the map. Each guide below is the detail. At a glance · Germany EUR · German · Monthly payroll Currency EUR € Employer social security ~21-22% pension, health, care, unemployment, accident; precise rate in tax guide Minimum wage €13.90 per hour from 1 Jan 2026; MiLoG Annual leave 20 days 5-day week; BUrlG section 3 Minimum notice 4 weeks section 622 BGB; rises to 7 months at 20 years Probation 6 months maximum; section 622(3) BGB Employer sick pay 6 weeks full pay; Entgeltfortzahlungsgesetz Dismissal protection KSchG over 10 staff, after 6 months service ![A warm, wide illustration of Berlin at golden hour: the Brandenburg Gate in the foreground, tree-lined boulevards leading into the city, and a clear amber sky above the rooftops.](/images/country-guides/germany-hiring.webp) Germany · per employee · per month · flat $ 599 Zero FX. No setup fees. Onboarding in days, not weeks. The price your finance team can forecast against without an asterisk. Zero FX Fixed No setup fee No exit fee Fast onboarding ## How much does it cost to hire an employee in Germany in 2026? A German hire costs roughly 121 to 122 percent of gross salary once employer social security is added. Employer social security runs around 21 to 22 percent on top of gross. A EUR 60,000 salary lands around EUR 72,780 to EUR 73,380 fully loaded, before the Teamed fee. Employer social security in Germany covers pension (Rentenversicherung), health (Krankenversicherung), long-term care (Pflegeversicherung), unemployment (Arbeitslosenversicherung), and statutory accident insurance. The combined employer share runs around 21 to 22 percent of gross, applied up to the annual contribution ceilings. Pension and unemployment contributions are split evenly between employer and employee; health and care are close to evenly split. All of this sits on top of the base salary. Germany pays a standard twelve monthly salaries. There is no statutory 13th or 14th payment, though many collective agreements and contracts add a Christmas or holiday bonus. The statutory minimum wage is EUR 13.90 an hour in 2026 under the Mindestlohngesetz, which sets the floor for almost every role. Teamed's Germany price is a starting rate, with zero FX in any currency pairing. No setup fees. No exit fees. Salaries, taxes, and benefits passed through at cost on every invoice. The full breakdown, with worked examples at current statutory rates, is in the cost guide. [Read the full Germany cost breakdown](/country-hiring-guides/germany/cost-breakdown) ## Do you need a German entity to hire employees in Germany? No. An Employer of Record runs German payroll and contracts from day one. Your own German GmbH becomes cheaper than EOR at around 6 to 9 employees on average German tech salaries. The crossover calculator returns the exact number for your team. Forming a German GmbH requires EUR 25,000 in share capital (at least EUR 12,500 paid up at registration), notarisation, and entry in the Handelsregister, then ongoing accounting, payroll, and social-insurance filing obligations. An [Employer of Record](/lp/employer-of-record) is faster and cheaper at low headcount. Teamed runs German payroll, contracts, and compliance from day one through its own German entity, Teamed GmbH in Berlin. The crossover where your own entity becomes cheaper typically lands at around 6 to 9 employees on average German tech salaries, and moves earlier at higher salaries. It also depends on benefits and your in-country accounting and legal costs, so run the [Crossover Calculator](https://www.teamed.global/tools/crossover-calculator), or read the [EOR vs entity guide](/country-hiring-guides/germany/eor-vs-entity), for the number that fits your team. Hiring direct, without an entity or an EOR, can create a permanent establishment for your company in Germany (section 12 AO), which brings corporate-tax exposure. The [permanent establishment guide](/country-hiring-guides/germany/permanent-establishment-risk) explains how the EOR structure avoids it. You progress from contractor to EOR to your own German entity on **one platform** under Teamed's Graduation Model, with tenure preserved. [Read the full Germany EOR vs entity guide](/country-hiring-guides/germany/eor-vs-entity) ## What are the key employment law rules in Germany in 2026? A written employment statement is due within the first week under the Nachweisgesetz, and probation is capped at six months (section 622(3) BGB). After 6 months in establishments with more than 10 employees, the Kuendigungsschutzgesetz removes at-will dismissal: every termination must be socially justified. German employment law is codified across the Buergerliches Gesetzbuch (BGB), the Kuendigungsschutzgesetz (KSchG), the Arbeitszeitgesetz (ArbZG), and a layer of collective agreements (Tarifvertraege) in many sectors. Working time under the ArbZG is 8 hours a day, extendable to 10 if the average stays within 8 over six months. A works council (Betriebsrat) carries co-determination rights once employees elect one. Payroll tax (Lohnsteuer) returns are filed monthly. Probation (Probezeit) runs up to six months, during which either side can end the contract on 14 days notice. Day-one rights, the written-statement deadline, and onboarding steps are covered in the [probation and onboarding guide](/country-hiring-guides/germany/probation-and-onboarding) and the [compliance and day-one rights guide](/country-hiring-guides/germany/compliance-and-day-one-rights). [Read the full Germany hiring guide](/country-hiring-guides/germany/hiring-guide) ## What benefits must you provide German employees in 2026? The statutory floor is 20 working days of paid annual leave and six weeks of full employer sick pay. Parental leave (Elternzeit) runs up to three years per child, with Elterngeld paid by the state during part of it. Statutory minimum paid leave is 20 working days on a five-day week under the Bundesurlaubsgesetz (BUrlG section 3), or 24 working days on a six-day week. Most German contracts grant 25 to 30 days. Continued pay in sickness (Entgeltfortzahlung) is the employee's full salary for six weeks, after which statutory health insurance pays Krankengeld. Public holidays are set per Bundesland and range from 9 to 13 days a year. Working time and leave, including the Arbeitszeitgesetz limits and rest rules, are set out in the [working time and leave guide](/country-hiring-guides/germany/working-time-and-leave). Maternity protection (Mutterschutz) covers six weeks before and eight weeks after birth, and either parent can then take Elternzeit of up to three years. The [benefits guide](/country-hiring-guides/germany/benefits) covers each statutory entitlement and the common contractual extras. [Read the full Germany benefits guide](/country-hiring-guides/germany/benefits) ## What are payroll taxes in Germany in 2026? Employee social security is roughly 20 to 21 percent of gross, up to the annual contribution ceilings. Income tax is progressive, from 14 percent above the EUR 12,348 tax-free allowance (Grundfreibetrag) to a 42 percent upper rate, with a 45 percent top rate on the highest incomes. German social insurance splits across pension, health, long-term care, and unemployment under separate codes. The employee share totals roughly 20 to 21 percent of gross, applied up to the annual ceilings, with the employer paying a similar amount on top. Pension contributions total 18.6 percent, split evenly between employer and employee. Health and care add the rest, with care carrying a small surcharge for employees without children. Income tax (Lohnsteuer) is progressive. The first EUR 12,348 a year is untaxed under the Grundfreibetrag. The rate then rises from 14 percent through the progressive zone to a 42 percent upper rate, with a 45 percent rate on the highest incomes. A 5.5 percent solidarity surcharge applies only above high thresholds, and church tax is optional. Lohnsteuer payroll filings are submitted monthly. The tax and payroll guide sets out every band and threshold. [Read the full Germany tax and payroll guide](/country-hiring-guides/germany/tax-and-payroll) ## How do you terminate an employee in Germany? German statutory notice starts at 4 weeks to the 15th or the end of a calendar month for employees in their first two years. Notice then scales with tenure to 7 months to a month-end after 20 years of service (section 622 BGB). Notice under section 622 BGB runs to fixed dates, the 15th or the end of a calendar month, which can extend the practical notice period beyond the raw number of weeks. During probation, either side gives 14 days. The schedule rises in steps: one month after two years of service, then longer at five, eight, ten, twelve, fifteen, and twenty years, reaching seven months at the top. Once an employee has more than 6 months of service in an establishment with more than 10 employees, the Kuendigungsschutzgesetz applies and the dismissal must be socially justified, on operational, conduct, or capability grounds. There is no automatic statutory severance, but settlement payments (Abfindung) are common where a dismissal is contested, often around half a month of pay per year of service. The termination guide covers notice, dismissal protection, and severance in full. [Read the full Germany termination and severance guide](/country-hiring-guides/germany/termination-and-severance) ## What should you know before hiring in Germany? Two things catch US buyers out. The first is that dismissal protection is strong and procedural, not at-will. The second is the line between an employee, a contractor, and a permanent establishment, which German authorities test on substance, not labels. **Dismissal is procedural in Germany.** Once the Kuendigungsschutzgesetz applies, you cannot end employment at will. You need a recognised ground, the right notice to a month-end, and often a settlement if the dismissal is challenged before the Arbeitsgericht. US buyers routinely underestimate exit costs by assuming a short, flat notice period. The [termination guide](/country-hiring-guides/germany/termination-and-severance) runs the full process. **Classification is tested on substance.** Labelling a worker a contractor does not settle the question. The Deutsche Rentenversicherung can find Scheinselbststaendigkeit and demand back-payment of social contributions, and a direct hire with contracting authority can create a permanent establishment for your company. The [misclassification guide](/country-hiring-guides/germany/misclassification) and the [permanent establishment guide](/country-hiring-guides/germany/permanent-establishment-risk) set out where the lines sit and how the EOR structure stays on the right side of them. [Read the full Germany hiring guide](/country-hiring-guides/germany/hiring-guide) ## Frequently asked questions How much does it cost to hire an employee in Germany? Plan on roughly 121 to 122 percent of gross salary once employer social security (around 21 to 22 percent of gross) is added. A EUR 60,000 gross salary lands around EUR 72,780 to EUR 73,380 fully loaded before the Teamed fee. Teamed's Germany fee is one flat number per employee per month, with zero FX mark-up. The cost breakdown guide has worked examples at current statutory rates. Can a US company hire in Germany without an entity? Yes. An Employer of Record like Teamed runs German payroll, contracts, and social insurance through its own German entity, Teamed GmbH in Berlin. You direct the work. Teamed becomes the legal employer of record, usually within days of terms being confirmed. Forming your own GmbH requires EUR 25,000 in share capital (at least EUR 12,500 paid up at registration), notarisation, and Handelsregister entry, and takes several weeks. What is the statutory annual leave entitlement in Germany in 2026? Statutory minimum paid leave is 20 working days on a five-day week under the Bundesurlaubsgesetz (BUrlG section 3), or 24 working days on a six-day week. Most German contracts grant 25 to 30 days. Public holidays are set per Bundesland and range from 9 to 13 days a year, counted separately from annual leave. What are German statutory notice periods? Statutory notice under section 622 BGB starts at 4 weeks to the 15th or the end of a calendar month in the first two years of service, then rises in steps with tenure to 7 months to a month-end after 20 years. Notice during probation is 14 days. After 6 months in establishments with more than 10 employees, the Kuendigungsschutzgesetz (KSchG) also requires the dismissal to be socially justified. What is the minimum wage in Germany in 2026? The statutory minimum wage is EUR 13.90 per hour from 1 January 2026 under the Mindestlohngesetz (MiLoG). It applies to almost all employees. Some sectors set higher floors through collective agreements, which Teamed applies where they bind a hire. Does using an EOR in Germany create a permanent establishment? No, when it is structured correctly. Teamed is the legal employer through its German entity. Your company contracts with Teamed and Teamed contracts with the employee. Provided the employee has no habitual authority to conclude contracts for your company and you keep no fixed place of business in Germany, no permanent establishment is triggered under section 12 AO or the relevant double-tax treaty. The permanent establishment guide covers the detail. Teamed Legal Operations Germany reads as a heavily codified hire: a written contract in the first week, social-insurance registration before day one, and dismissal protection that turns on headcount and tenure. The surprises are the notice schedule that climbs to seven months, the Kuendigungsschutzgesetz that removes at-will dismissal once you pass ten staff, and the permanent establishment line you can cross by hiring direct. These guides exist so the first German hire does not turn into an unexpected liability. A note from Tom Price-Daniel Germany protects the employee by default, and the contract you sign on day one is the contract a court reads later. Notice climbs to seven months, dismissal must be socially justified, and hiring direct can create a taxable presence. Read the right Germany guide before that first hire, not after the first dispute. Tom Price-Daniel · Co-founder, Teamed ## Keep reading - [Germany hiring guide, offer to payslip](/country-hiring-guides/germany/hiring-guide)guide - [Germany employer cost breakdown 2026](/country-hiring-guides/germany/cost-breakdown)guide - [EOR vs entity in Germany](/country-hiring-guides/germany/eor-vs-entity)guide - [Germany termination and severance](/country-hiring-guides/germany/termination-and-severance)guide - [Germany tax and payroll](/country-hiring-guides/germany/tax-and-payroll)guide - [Germany employee benefits](/country-hiring-guides/germany/benefits)guide - [Germany working time and leave](/country-hiring-guides/germany/working-time-and-leave)guide - [Germany probation and onboarding](/country-hiring-guides/germany/probation-and-onboarding)guide - [Germany compliance and day-one rights](/country-hiring-guides/germany/compliance-and-day-one-rights)guide - [Germany permanent establishment risk](/country-hiring-guides/germany/permanent-establishment-risk)guide - [Germany worker misclassification risk](/country-hiring-guides/germany/misclassification)guide - [Employer of Record overview](/lp/employer-of-record)core - The Graduation Modelcore - [Teamed pricing, Zero FX Fixed](/pricing)core - [Crossover Calculator](https://www.teamed.global/tools/crossover-calculator/germany)tool - [Talk to an expert](https://www.teamed.global/contact)CTA A note on this page. This is a guide, not legal, tax or accounting advice. Rules change and vary by jurisdiction. Verify current requirements with the Bundesministerium der Justiz (gesetze-im-internet.de), the Bundesministerium fuer Arbeit und Soziales (BMAS), and the Deutsche Rentenversicherung for Germany, or speak to a qualified professional, before relying on any specific framework.