The minimum wage - Questions and Answers

Why did Germany introduce a statutory minimum wage?

A general statutory minimum wage was introduced to protect workers in Germany from unreasonably low wages. The statutory minimum wage also contributes to fair and effective competition. At the same time it ensures greater stability in Germany’s social security systems.

What is the legal basis regulating the minimum wage?

The minimum wage is regulated by the Minimum Wage Act. In addition binding sector-related minimum wages may be negotiated on the basis of the Act on the Posting of Workers.

Who benefits from the minimum wage?

The minimum wage protects workers in low-paying jobs from wage dumping and guarantees appropriate social participation. The minimum wage also contributes to ensuring that businesses do not engage in competition at the expense of workers by agreeing ever lower wages, but that they in fact compete for better products and services.

To whom does the general minimum wage apply?

The statutory minimum wage applies to all workers over 18 years of age.

To whom does the general minimum wage not apply?

The following persons are not workers within the meaning of the Minimum Wage Act:

• Trainees under the Vocational Training Act
• Volunteers
• Persons providing voluntary service
• Participants in an employment promotion programme
• Home workers under the Home Work Act
• Self-employed persons
• 18 years of age without completed vocational training
• Long-term unemployed persons during the first six months of re-entering the labour market

Are foreign workers also entitled to the minimum wage?

Yes. The minimum wage also applies to them, if they work in Germany - regardless of whether they are employed by a domestic or a foreign employer.

In the cross-border sector for the transport of people and goods, in particular road transport, some special rules have to be observed with regard to the application of the Minimum Wage Act. These are detailed on the following website of the Federal Customs organisation: Zoll online – Application of the Minimum Wage Act in the area of cross-border transport of people and goods (in particular road transport).

What rules apply to cross-border activities?

No special rules apply to workers who are employed in Germany and perform cross-border activities. The public-law obligation to pay the minimum wage that is subject to administrative fines payable in case of non-compliance only applies in Germany. However, in general, employers continue to be bound by their obligations towards their employees under labour law even when borders are crossed. This includes the entitlement to the minimum wage.

What applies to people in marginal employment?

The statutory minimum wage applies to all workers, regardless of their working hours or their working time regime - and thus also to those working in marginal employment. The statutory minimum wage is a gross hourly wage. The employer’s share of the contributions to social insurance is not taken into consideration when calculating the minimum wage. This means that also contributions to the statutory health insurance and to the statutory pension insurance are paid by the employer - and this in addition to the gross hourly wage. What is new since the introduction of the minimum wage is the employer’s obligation to record the working hours of people in marginal employment. Employers have to keep the records for two years and must be able to present them if the Federal Customs services carry out an inspection. The duty to keep records does not apply to persons in marginal employment in private households and not to close family members of the employer (spouses, registered partners, parents, children).

Are seasonal workers also entitled to the minimum wage?

The statutory minimum wage also applies to seasonal workers. If employment is limited from the outset to no more than three months or 70 working days per calendar year and if it is not exercised as a professional activity (short-term employment), no contributions have to be paid to the health, long-term care, pension or unemployment insurance. This regulation does not impact the minimum wage level.

Does the minimum wage apply to persons with disabilities who are employed in workshops for persons with disabilities?

This depends on the nature of the employment relationship. If it is an employment relationship such as in work integration social enterprises, the minimum wage applies. Where persons with disabilities work as “employee-like persons”, as for example when they work in recognized workshops for persons with disabilities, the minimum wage does not apply to them.

What particular rules apply to interns?

As a fundamental principle, interns are entitled to the minimum wage. Exceptions apply to compulsory internships, i.e. especially to internships that must be completed by virtue of secondary education regulations, vocational training regulations or university regulations.

In the case of voluntary internships that do not last longer than three months, the individual is not entitled to the minimum wage when the internship serves career orientation purposes in the context of deciding on a vocational training course or university studies, or if the internship is undertaken during a person’s vocational training or university studies. In addition, the minimum wage does not apply to internships undertaken in connection with an introductory training programme conducted pursuant to Book Three of the German Social Code (SGB III) or in connection with training preparation schemes pursuant to the Vocational Training Act.

When a voluntary internship lasts longer than three months, is the minimum wage to be paid starting the first day or the fourth month?

In the case of voluntary internships (internships for the purpose of career orientation, during vocational training or university studies) that do not last longer than three months, the minimum wage does not apply. When this type of internship lasts longer than three months, the entire internship is subject to the minimum wage, and the minimum wage is to be paid from the first day on. This applies not only when it is known from the start that the 10 The minimum wage internship will last longer than three months but also when a three-month internship is extended beyond three months.

Minimum wage during internships?

It is very easy to find out whether an internship is subject to the minimum wage by following this link on the website www.bmas.de/mindestlohn.

Writing one’s graduation thesis during an internship - does the minimum wage apply?

If students merely write their study-related final thesis (like a bachelor or master thesis) or a Ph.D. thesis, this is not deemed an internship relationship as the student does not perform any work for the company. If they are not to be classified as employees either, there is no obligation to pay the minimum wage.

However, the obligation to pay the minimum wage may apply if a (thesis-related) internship has been agreed and the student is also involved in work for the company in the framework of this internship and no exemption applies in accordance with the Minimum Wage Act. Whether these prerequisites are fulfilled has to be determined according to the circumstances of the specific.

What applies when provisions in collective agreements conflict with the statutory minimum wage?

The minimum wage takes priority over collective agreement provisions that conflict with the minimum wage and are less favourable for workers.

Are piecework pay and monthly wages compatible with the minimum wage?

Every worker has a statutory right to being paid the statutory minimum wage. It will still be permissible to agree unit and piece rate wages after the minimum wage is introduced if it is guaranteed that a worker is still paid the minimum wage for the hours actually worked during the accounting period.

In what cases do employers have to document the working hours of their workforce?

In certain cases, employers are subject to a documentation duty in order to ensure that the minimum wage is really paid for the working hours performed. This applies in general to people in marginal employment (exemption: marginal part-time work in private households) and the economic sectors listed in the Act to Combat Clandestine Employment. These include the construction sector, restaurants and hotels, the shipping, transport and logistics sector, forestry, facility cleaning services, trade fair builders and the meat industry.

Only close family members are excluded from the documentation obligation (spouses, registered partners, parents, children) and, if the employer is a legal person or 12 The minimum wage unincorporated firm, organs entitled to represent the employer and their members as well as partners entitled to represent the employer. This also applies to workers whose set monthly salary exceeds 4,319 euros gross (4,461 euros as from 1 January 2025). As for workers who regularly earned more than 2,879 euros gross per month (2,974 euros as from 1 January 2025) in the course of the last twelve months, employers are also exempt from their documentation obligation. Here, proof has to be furnished that this salary has really been paid.

The Minimum Wage Act thus follows up on already existing documentation obligations. A documentation obligation also applies to marginal employment in the framework of the “guidelines governing social security thresholds” of the social insurance branches and of the Federal Employment Agency.

In what form must employers required to keep records document working hours?

Employers who are in general obliged to document working hours under the Minimum Wage Act (see above) must record start, end and duration of their employees’ daily working hours. This documentation does not require any specific form. Working hours can for example also be recorded in handwriting on a simple timesheet. Nor does the specific duration and scheduling of the breaks need to be shown separately. In the case of employees who work exclusively as mobile workers and who are able to organise their working time in a flexible and autonomous manner, such as newspaper deliverers, it is sufficient to record the duration of the working time.

The obligations to draw up documentation for the meat industry have been changed in such a way that employers and user undertakings are obliged to record the start of the daily working time of workers and temporary agency workers electronically and tamper-proof immediately upon commencement of work and the end and duration of their daily working time on the day they work. The records have to be stored electronically. Set-up, dressing and washing times have to be counted as working time provided they are necessary and prescribed by the employer. The above does not apply to companies in the meat industry within the meaning of the Act to Secure Workers’ Rights in the Meat Industry.

Can a contractor be held liable if a subcontractor does not comply with the Minimum Wage Act?

A prime contractor who uses the services of a sub-contractor to comply with his own obligations vis-à-vis his or her contracting partner, is liable for compliance with the statutory minimum wage by the subcontractor vis-à-vis workers of the latter. The same applies to liability vis-à-vis workers employed by further companies contracted by this subcontractor or to workers from temporary work agencies. This so-called contractor liability is laid down in the Posted Workers Act and has thus already applied for many years. The Minimum Wage Act draws on this existing rule as it has proven its worth. Only contractor liability can prevent systems designed to conceal exploitative working methods through so-called subcontractor chains. Without such a rule, there would be a loophole in the law which would ultimately harm honest employers and workers in particular.

Who will decide on adjustments to the minimum wage?

The adjustment of the minimum wage level is a matter for an independent commission of the collective bargaining partners. As part of an overall assessment, the commission must examine what minimum wage level provides adequate minimum protection for employees, allows for fair competition and does not lead to job losses. It must base its decision on the development of collectively agreed wages in Germany. The Federal Government can make the adjustment proposed by the Minimum Wage Commission binding by means of a statutory instrument. However, it can only implement the proposal as it stands and cannot set a different level autonomously.

How is membership in the Minimum Wage Commission composed?

Following the principle of parity, the Minimum Wage Commission is composed of six members from among the community of employers and employees who have voting rights, as well as two advisory members from the academic community appointed by the Federal Government at the proposal of the umbrella organisations of employers and employees respectively. In addition, there is a chairperson with voting rights who is also appointed by the Federal Government at the joint proposal of the umbrella organisations. The members of the Minimum Wage Commission will be newly appointed every five years. The members’ names are published at www. mindestlohn-kommission.de.

The Minimum Wage Commission’s decision making process

The Commission has a quorum when at least half of its voting members are present, i.e. when three or more voting members are present. The two advisory members have no voting rights. The decisions of the Minimum Wage Commission are taken with a simple majority of the members who are present. The chairperson must initially abstain from voting.

In the event that a majority of votes is not reached, the chairperson will submit a proposal for a compromise. When, after further deliberations regarding the proposed compromise, a majority is not reached, the chairperson will exercise his/her right to vote and cast the deciding vote.

Who is responsible for monitoring compliance with the obligation to pay the minimum wage?

As has been the case already with sectoral minimum wages, the Federal Customs Administration unit in charge of enforcing the law on illegal employment and benefit fraud (Finanzkontrolle Schwarzarbeit - FKS) is responsible for monitoring compliance.

What system is used to monitor whether the minimum wage is paid?

The Federal Customs Administration unit in charge of enforcing the law on illegal employment and benefit fraud carries out inspections using a risk-oriented approach. Compliance with the minimum wage is checked during all FKS inspections.

What sanctions apply in the event of violations?

Minimum wage violations can be punished with a fine of up to 500,000 euros. Infringements of obligations to be complied with during inspections, such as presenting the documentation of working time, may be penalised by a fine of up to 30,000 euros. In addition, the company can be excluded from the award of public contracts.

Who can employees contact if the minimum wage is not paid?

The Federal Customs Administration units are responsible for taking legal action in the event of violations of the law. Employees can obtain information about their rights under the Minimum Wage Act by calling the Minimum Wage Hotline, available at +49 30 60 28 00 28.

In the case of complaints requiring the intervention of the Federal Customs Administration units, callers may be referred directly to the competent customs office. It is up to the workers themselves to enforce their individual minimum wage entitlements.

You can lodge a complaint with the competent labour court also without a lawyer. If the victims are members of a trade union they enjoy legal protection by their trade union to enforce their minimum wage entitlements.

Who can I contact for questions about the minimum wage?

The minimum wage hotline answers any minimum wage-related questions. This is an offer for individuals, workers and employers alike.