FAQ – Wages and salaries

When you are paid for your work, there are different terms for the money you receive: Wage, salary, pay or remuneration. Pay and remuneration are formal terms for payment. Wages and salaries are defined differently.

• Salary = if you receive a fixed amount every month, this is called "Gehalt" (monthly salary).
• Wage = if you are paid per hour (hourly wage), this is called "Lohn". The amount of your monthly wage then depends on how many hours you have worked.

Your employment contract usually states how much you will be paid for your work (as an employee). It tells you how much money you earn in a month or in an hour. It is important to know whether a collective agreement applies to you. Collective agreements can also contain rules on wages. Some sectors have an industry-specific minimum wage, for example in the electrical trade or building cleaning.

Please note: Germany has a statutory minimum wage!

When you receive your wages must be precisely regulated. This is what is known as the due date. The law stipulates that wages are only paid after work has been performed. So if you are paid per month, you will receive your wages on the first day of the next month. This is stipulated by law.

Please note: there are exceptions to this rule:

The minimum wage must be paid no later than the last bank working day of the month following the month in which you worked: So if you worked in July, you must receive your salary for this by the last working day in August at the latest.

In the case of vocational training (trainee pay), your salary must always be paid on the last working day of the month.

The employment contract or collective agreement may stipulate something other than the statutory regulation. Here it is often agreed that the wages must be paid on the 15th day of the following month. However, an earlier payment date can also be agreed. You should check what it says in your employment contract.

Supplements to your wages

In addition to the agreed wage, supplements or bonuses may also be paid. These are amounts that the employer pays in addition to the basic wage. The only legal requirement is that there must be supplements for night work. Night work is work between 11 pm and 6 am (for confectioners/bakeries: between 10 pm and 5 am). Supplements for overtime, work on Sundays and public holidays are often agreed in collective agreements or employment contracts. The supplements can vary in amount. If you are paid supplements, they will also be listed on your payslip.

Bruttolohn = gross wage = is the wage stated in your employment contract. Social insurance contributions are deducted from this sum, for example pension insurance, unemployment insurance, health insurance and nursing care insurance. You pay these contributions pro rata, i.e. your employer also pays for you. For example, your employer pays the contribution for your accident insurance. Taxes are also deducted from your gross wage.

Nettolohn = net wage = this is the money you actually receive (after deductions).

Gross/net as a working student

As a working student, you are only allowed to work 20 hours a week during the lecture period. Only a contribution to nursing care insurance and wage tax will be deducted from your gross salary. Working students do not pay contributions to health insurance, the pension scheme or unemployment insurance.

Please note: if you turn 30 during your studies, your compulsory student health insurance ends. Then what is known as "voluntary membership" begins and your health insurance contributions will more than double.

Gross/net in a mini job

If you have a mini job, you are only obliged to pay into pension insurance. You do not pay any contributions to the other social insurance schemes. However, you can get yourself exempted from compulsory pension insurance. You need to actively apply for this, however. Then you won't have any deductions and will receive the full 538 Euros in your account. The employer pays lump sums for health and pension insurance, among other things.

Gross/net in an internship

If you have to do a compulsory internship for your school or academic vocational training, your employer does not have to pay you any money. If he/she pays you money anyway, you don’t pay any tax or social insurance contributions. There are different rules for a paid voluntary internship:

• If you work up to 20 hours a week and receive a wage of 538 Euros, you would generally have to pay into the pension scheme.
• If you work more than 20 hours a week, you are fully liable for insurance.

If you are unsure how much money you will receive net or what will be deducted, you can look at your payslip. Your gross and net wages are shown there. Or you contact your Fair Integration advice centre.

In principle, it is possible for your employer to deduct amounts for board and lodging from your wages if he/she provides you with accommodation. There are rules on how high these contributions may be. The seizure exemption limit always applies: this limit is to protect you as an employee. The limit should enable you to continue to cover your running costs (rent, food, electricity) despite having your salary/wages seized. Your employer must also adhere to this limit.

Wage or salary seizure is a type of compulsory enforcement. If you owe someone money, they can sue you in court. This person can then collect the money directly from your employer with the help of the court. However, the seizure exemption limit also applies here. The seizure exemption limit is 1,402.28 Euros, whereby the seizure exemption amount increases depending on the number of dependants.

You can view the seizure table at the following link: https://www.bmj.de/SharedDocs/Publikationen/DE/Broschueren/Pfaendungsfreigrenzen_Arbeitseinkommen.html

Please note: you should seek advice from a debt counselling centre before a seizure is carried out!

If you do not receive your wages (on time), you can claim them. You can submit this in writing to your employer. It is best to get help from your advice centre or your trade union (if you are a member). You should know exactly how much pay you are entitled to and be able to prove how much you worked and when!

Please note:  there are certain deadlines or time limits for claiming wages.

These are set out in the employment contract or collective agreement. This means that you only have time to claim your wages within this specific period. You should seek advice quickly and make your claims as soon as possible.

Please note: you are always entitled to your wages – even if you have been dismissed, do not have a written employment contract or have worked without a work permit.

As a general rule, overtime must be paid. Overtime is when you work more hours than you would normally have to (daily working hours). Overtime exists in the legal sense if your employer instructed you to work overtime or knew that you were working overtime and did nothing about it.

In certain cases, your employment contract may contain different regulations about the payment of overtime. Sometimes overtime is not paid, but compensated in time off (time off in lieu).

Please note: it is important that you write down your working hours. Then you can prove how many hours you have worked and check your payslip.

If your overtime is not paid and not compensated in time off, get help and contact your Fair Integration advice centre!

The payslip has several names in German: Lohnabrechnung, Gehaltsabrechnung or Entgeltabrechnung. This statement shows how much you have earned (gross wage) and what deductions have been made (social insurance contributions, taxes). It also says how much money you will be paid after deductions (net wage).

There are two parts to the payslip.

At the top:

• Period covered by this statement (month)
• Name and address of the employer
• Your name, address and date of birth
• Date of the start of employment
• Tax class and tax identification number
• Sometimes the remaining holiday days are also listed there.

The main part of the payslip contains the gross wage with gross payments. This part shows what your wage is made up of: Supplements and other payments may be listed, for example if you have been ill, as the employer is then obliged to continue paying your wages. The gross payments together make up the total gross amount. Both tax deductions and social insurance deductions are listed under the total gross amount.

After these deductions, the net earnings are calculated. In some cases, there are still net payments or net deductions that are deducted from net earnings. At the bottom of the payslip you will find the amount that will be transferred to your account. This is called the "Auszahlungsbetrag" (amount which is paid out).

Please note: your employer must give you your payslip every month. If you don't receive a payslip, you should demand one.

Your payslip is an important document that you always need to check. Sometimes payslips can contain mistakes. To check them, you need to know when you worked and have everything written down. You can then compare the payslip to the hours you have recorded and check whether you have been paid for everything. Extra pay may have been agreed in the employment contract or collective agreement for overtime, night work, work on Sundays or public holidays. These must also be identifiable on the payslip.

Does your employer have to give you a payslip?

You normally receive a payslip every month. If your wage has not changed compared to the previous month, your employer does not necessarily have to provide you with a payslip. You only need to receive a payslip if your wage changes.

Important: you can also ask for a payslip. Then you can check whether you have received the correct wages.

What do deductions (Abzüge) on your payslip mean?

Sometimes money is deducted from your net earnings. These are known as “Netto-Abzüge” (net deductions). For example, if your employer provides you with a flat and deducts the rent from your wages. Some deductions are not legally permitted. Your employer is only allowed to deduct money from your net earnings if your net earnings are not below the seizure exemption limit.