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When employing in Germany, employers will face additional costs on top of gross salary as contracted with their staff. German social security contributions can amount to > EUR 1,400 each month, so an extra 17k annually.
Generally speaking, half of social security contributions are paid by employing companies (on top of gross salary) while the other half is to be paid by employees. Still, the employer is obliged to do all payroll deductions and transfer the amounts to respective insurances and the wage tax authority. In return, German employees are covered under health insurance, nursing care insurance, unemployment insurance and the statutory pension system.

In its decision of 13 September 2022 (1 ABR 22/21), the Federal Labour Court (Bundesarbeitsgericht - BAG) established the obligation to record working time resulting from Section 3 (2) 1 of the German Occupational Health and Safety Act (ArbSchG). The reasons for the decision, which have now been published, show which concrete implementation obligations employers have to comply with and what leeway (still) exists in the implementation.

A recent wake-up call from Germany's highest labour court, but merely "old wine in new bottles": Already in 2019, the European Court of Justice (ECJ) ruled that employers must provide an objective, reliable and accessible time recording system (ECJ, judgment of 14 May 2019 – C-55/18). Since this decision, the German legislator has also been called upon to adapt the German Working Time Act to EU law in accordance with the ECJ's requirements. The Federal Labour Court (Bundesarbeitsgericht – BAG) has now ruled that employers are already obliged to introduce a system to record the working time worked by employees (Federal Labour Court, decision of 13 September 2022 – 1 ABR 22/21).

In Companies there are employees who achieve significantly worse work results than their colleagues. What options does an employer have if such a low-performer is employed by him? The Cologne Federal Labour Court recently ruled that the dismissal of a low-performer was justified, which you should be aware of (Cologne Federal Labour Court, ruling of 3 May 2022 - 4 Sa 548/21).

From 1 August 2022, stricter requirements apply to the proof of working conditions that the lawmakers consider essential. Depending on the way the verification requirements are implemented, this may lead to mandatory compliance with the written form for employment contracts.

In connection with the Corona pandemic, short-time work was introduced in many companies. Not infrequently, this has resulted in a complete exemption from the obligation to work (so-called "short-time work zero"). According to the decision of the Federal Labour Court of 30 November 2021 (9 AZR 225/11), this may be taken into account when calculating annual leave.

Until now, employers have paid out the compensation for employees in Covid-19 quarantine according to the Infection Protection Act (Infektionsschutzgesetz - IfSG), which the federal state reimbursed them afterwards. However, since 1 November 2021, following a decision by the health ministers’ conference, state compensation for quarantine as a contact person shall be denied to unvaccinated persons with reference to the possibility of vaccination. The same applies to quarantine of unvaccinated persons after return from a travel area that was already classified as a risk area on the outward journey.

It is now important for employers to know whether they can refuse to pay wages to unvaccinated employees in contact quarantine and after-travel quarantine. It is also important to know whether they have the right to ask about the vaccination status of employees in Covid-19 quarantine.