Germany ranks 114th in ease of opening a new business. It can take six months to get started and a tax advisor is strongly recommended as there are many financial filings to make on the way, from the type of business you’re trying to open, to two sets of tax registration, and obtainment of a certificate of registration. For this reason, many companies use our German PEO and employer of record model in Germany to facilitate an easy access to the market. By using our German PEO, you can hire an employee in Germany within a few days of finding your ideal candidate.
When negotiating terms of an employment contract and offer letter with an employee in Germany, it may be useful to keep the following in mind:
Effective 1 April 2017, there are strict laws in place in Germany about employment secondment. Companies hiring people to work on behalf of other companies in Germany, as part of a global PEO solution, are legally required to have an AUG or temporary agency license. While the licensing requirements are nebulous, we take pride in following the absolute letter of the law in Germany. This is to our customers’ advantage as well as our own, because according to the law, the end client is at risk if an employee is engaged on their behalf in Germany under a company which is not licensed. As far as we know, Globalization Partners is the only Global PEO providing a fully-compliant solution in Germany.
Our comprehensive solution and Global PEO service enables customers to run payroll in Germany while HR services, tax, and compliance management matters are lifted from their shoulders onto ours. As a Global PEO expert, we manage employment contract best practices, employee expenses, as well as severance and termination if required. We also keep you apprised of changes to local employment laws in Germany.
Your new employee is productive sooner, has a better hiring experience and is 100% dedicated to your team. You’ll have peace of mind knowing you have a team of dedicated employment experts assisting with every hire. Globalization Partners allows you to harness the talent of the brightest people in 187 countries around the world, quickly and painlessly.
Germany has many different visa types available, which can make it tough to choose which is best for your employees. If you’re already in the midst of a global expansion, it can prove difficult to focus on obtaining work visas in Germany when you’re also dealing with hiring, payroll, compensation, benefits, and more.
Types of Work Visas in Germany
If your employees are not European Union (EU) or European Economic Area (EEA) nationals, they need to acquire a residence permit to work or study in Germany for more than 90 days. They must acquire this permit in addition to a visa and work permit. The most common resident permit types include:
- Temporary residence permit
- Blue Card
- EC long-term residence permit
- Permanent settlement permit
Most individuals seeking work in Germany will acquire a temporary residence permit that’s valid for one year. They can renew it depending on their employment status, occupation, and nationality. Typically, the residence permit renewal is a formality as long as your employee’s personal situation doesn’t change. It’s best to contact the local Aliens Registration Office and consult with an immigration lawyer if they switch employers, stop working, or go through a marriage shift, as these situations can impact their residency status.
Requirements to Obtain Germany Work Visas
After an employee gets a residence permit, they can apply for a work permit. They’ll need a confirmed job offer and proof that the vacancy cannot be filled by an EU national or another immigrant who applied first. Work permits are typically granted for a year, but renewal is possible. Highly skilled employees will get a different kind of permit that’s valid for several years.
Recently, Germany simplified the process by allowing migrants to apply for a work and residence permit through a single permit directive of the EU. Obtaining a single permit allows non-EU nationals to work and reside in all EU countries, including Germany. To be eligible, an individual must be a non-EU national entering Germany for work or residence or already living in the country with access to German jobs.
Obtaining a working visa in Germany typically requires the following steps:
- Getting a job offer
- Checking for visa requirements for long stays
- Submitting a visa application
- Collecting all the required documents
- Making an appointment for a visa interview
- Paying the German Employment Work Visa fee
- Attending the interview
- Waiting for a response on the application
An employee has to submit several documents to the German embassy or consulate in their country of residence to show that they fulfill all the right conditions for an employment visa, including proof of residency, proof of qualification, a personal covering letter, and a binding job offer. Keep in mind that the typical fee for a German long-stay visa is 75 EUR.
Conclusion: Other Important Considerations
Germany started trialing a points-based system called Punktebasiertes Modellprojekts für ausländische Fachkräfte (PUMA) in 2016. Currently, it’s only in place in Baden-Württemberg, but it could transition to the entire country. The system allows third-country nationals to enter and work in Germany if they get 100 points for everything from German, English, or French language skills to previous time spent in the country and the existence of German relatives.