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Employee Leasing in Germany

As the strongest economic powerhouse in Europe and the fourth-strongest in the world, Germany offers tremendous opportunities for companies wishing to expand their activity in the country. The quality and work ethics of the German labor force, coupled with the efficiency of German infrastructure, make Germany one of the best destinations in the world for investment.

Expanding into Germany becomes extremely easy thanks to the employee services we provide at FMC Group. We help clients throughout the entire recruitment process of their local employees in Germany and we continue to handle the day-to-day administrative management of employees, while clients focus entirely on business decisions. This allows for a great cost and risk reduction in the activity expansion.


  • Advantages of Employee Leasing in Germany
  • Employee Leasing Services Offered by FMC Group
  • Advantages of the German Market
  • Recruitment in Germany
    • Minimum Wage and Payroll
    • Social Contributions and Taxes
    • Working Hours and Overtime
    • Vacation Days
    • Parental Leave and Sick Leave
    • Notice Period
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Stephan Dorn FMC Group

Advantages of Employee Leasing in Germany

  • Employee leasing in Germany gives clients access not only to the German labor force but the entire European talent pool.
  • Expanding business activity in Germany through employee leasing allows companies to have a local presence in one of the largest consumer markets and the strongest economies in the world.
  • Employee leasing greatly facilitates expanding into Germany, as it allows clients to focus solely on business decisions while entirely delegating the recruitment process and administrative management of employees to FMC Group.

Employee Leasing Services Offered by FMC Group

  • We search for and select the best candidates for your company;
  • We negotiate and sign employment contracts with successful candidates;
  • We provide professional accounting services according to international standards;
  • We pay taxes and social security contributions in accordance with German regulations;
  • We monitor your employees’ paid vacations;
  • We implement private health insurance for your employees if requested;
  • We maintain regular contact with you regarding the management of your employees.

Management and Reporting Flow of Employee Leasing Services

Management and Reporting Flow Chart

Advantages of the German Market

  • The German economy is the strongest economy in Europe and the fourth-strongest in the world. It offers a large domestic market of over 83 million consumers, as well as easy access to the entire market of the European Union with its over 440 million consumers.
  • The German labor force is one of the most productive worldwide and is also highly skilled. The general and vocational education systems in Germany are world-renowned and attract young talents from all around the globe. Some of the most popular fields of study in Germany are business administration, mathematics and statistics, and engineering and manufacturing.
  • Located at the heart of Europe, Germany is considered as the leading logistics market in the continent, thanks to the quality of its energy and communications infrastructure, as well as the efficiency of its transportation networks.
  • The “Made in Germany” label is one of the most reputable manufacturing labels in the world. It has been an international symbol for great quality for several decades and it has played an important role in helping Germany maintain its position as a world-leading exporter in several sectors for many years. Companies that expand their activity into Germany get the possibility to fully benefit from the reputation of the “Made in Germany” label.
  • Germany Trade and Invest is a rich source for regularly-updated information on investment opportunities in Germany and the advantages of the German market.

Recruitment in Germany

Minimum Wage and Payroll

  • The national minimum wage in Germany is set at EUR 10.45 per hour.
  • Salaries in Germany are paid monthly, typically on or around the 25th day of each month.

Social Contributions and Taxes

Employer Contributions
Pension Insurance 9.30%
Health Insurance 7.90%
Long-Term Care Insurance 1.52%
Unemployment Insurance 1.20%
TK Supplementary Contribution Rate 0.60%
Insolvency Charge 0.12%
Total 20.64%
Employee Contributions
Pension Insurance 9.30%
Health Insurance 7.90%
Long-Term Care Insurance 1.52%
Unemployment Insurance 1.20%
TK Supplementary Contribution Rate 0.60%
Total 20.52%
Employee Income Tax
Up to EUR 9,984 per year 0.00%
Between EUR 9,985 and EUR 58,596 14.00%
Between EUR 58,597 and EUR 277,825 42.00%
More than EUR 277,826 45.00%


Working Hours and Overtime

  • The standard working limit in Germany is 48 hours per week and eight hours per day.
  • The daily working limit can be extended to 10 hours per day if, within the previous 24 weeks, the average working hours did not exceed eight hours per day.
  • Any work above the standard working limit is paid at an overtime rate, usually defined by employer unions, collective bargaining agreements, or employment contracts.

Vacation Days

  • Employees in Germany are entitled to 24 days of paid leave per year, but it is customary for the leave to be extended to 30 days.
  • Germany celebrates eight national public holidays, along with other holidays that differ based on the state.
  • German national holidays are:
    • New Year’s Day: January 1st;
    • Good Friday: Between March and April (moveable);
    • Easter Monday: Between March and April (moveable);
    • Labor Day: May 1st;
    • Ascension Day: Between May and June (moveable);
    • Pentecost Monday: Between May and June (moveable);
    • Day of German Unity: October 3rd;
    • Christmas Holiday: December 25th – December 26th.

Parental Leave and Sick Leave

  • Expectant mothers in Germany are entitled to 14 weeks of paid maternity leave, including six weeks before delivery and eight weeks afterward. The public health insurance provides payment during this period for up to EUR 13 per day, while the employer has to cover the difference.
  • Parents have the right to take 36 months of unpaid parental leave after the birth of their child. This period can be shared between both parents. Employees must take at least 12 months of parental leave during the first three years after birth, while the remaining duration can be taken until the child is seven years old.
  • Employees in Germany can take up to 78 weeks of paid sick leave in a three-year period. The first six weeks of the leave are fully paid. After six weeks, employees receive between 70% and 90% of their regular salary for up to 78 weeks. Pay during sick leave is covered by health insurance.

Notice Period

  • The notice period for resigning employees in Germany is generally set at four weeks.

Further Useful Information

Disclaimer: Although we carefully researched and compiled the above information, we do not give any guarantee with respect to the actuality, correctness, and completeness.