Employer of Record Germany
Hire in Germany without setting up a GmbH. We become the legal employer for your new team member, so their German contract, payroll, Lohnsteuer and social insurance are handled correctly from day one.
Book a DemoOur EOR Portal
Everything you need to employ people in Germany, in one platform
The day-to-day of employing someone in Germany runs through one system. New starters, monthly payslips, holiday and contract changes all sit in the same place, so your team and ours stay in step and nothing gets missed.
- See onboarding steps and signed documents at a glance
- Approve payroll and download German payslips
- Manage leave, pay changes and contract updates
- Stay aligned with German payroll, tax and employment rules
Why EOR Germany?
Why businesses trust us to employ their people in Germany
Germany is the whole of our work here, not a line on a longer list. As your Employer of Record you get people who deal with German employment every working day, from Lohnsteuer and the statutory health and pension funds to the paperwork the Finanzamt and Deutsche Rentenversicherung expect. Whether you are hiring your first person in Berlin or building a team across several cities, we have done it before.
We take on the legal employment through our own German entity, which holds an AÜG licence (Arbeitnehmerüberlassungserlaubnis) from the Bundesagentur für Arbeit, the permission German law requires to employ someone on your behalf. We run the monthly payroll and keep every hire compliant, from the first contract under German law to the day a person moves on.
Employment Costs
What it costs to employ someone in Germany
The first question we usually get is what it really costs to employ someone in Germany.
Employer social contributions
Employing in Germany means paying social contributions on top of the gross salary: roughly 21% extra on a standard contract, split across pension, health, long-term care and unemployment insurance, with a few smaller levies alongside. The full fee breakdown lives on our EOR Germany pricing page.
Employee deductions
Before net pay reaches the employee, two deductions come off the payslip:
- Lohnsteuer, the wage tax, runs on a progressive scale that starts at 14% in 2026 and climbs to 45% at the top, with the exact amount shaped by the employee’s tax class.
- Employee social contributions come to roughly 20% of gross salary, split across pension, health, long-term care and unemployment insurance, each up to its own ceiling. Childless employees pay a small extra care surcharge.
Worked example
A worked example on €70,000
Your total cost
≈ €85,200
Salary plus about 21% employer social contributions, capped at each branch ceiling
Employee take-home
≈ €42,000
After income tax (Lohnsteuer) and employee social contributions, for a single employee on tax class I
The exact figure depends on the employee’s tax class, health insurer, church-tax status and whether they have children.
Each month we run that calculation, send the contributions to the health and pension funds, file the Lohnsteuer with the Finanzamt and produce the payslip. One invoice arrives from your EOR Germany team covering salary, statutory costs and our fee.
The EOR Process in Germany
What employing someone in Germany actually involves
When you hire someone in Germany, a handful of steps happen before they start, and a few keep running each month while they work for you.
Before day one, the employee has to be registered for social insurance and given written terms of employment. The Nachweisgesetz requires the main terms in writing, including pay, working hours, holiday and notice. A German contract can be open-ended (unbefristet) or fixed-term (befristet).
Within hours of receiving your details we issue the contract, drafted to German employment law, and where a Tarifvertrag covers the role its terms are incorporated.
Next we register the employee with the health insurer and the pension system and set up payroll. Each month we calculate and deduct wage tax (Lohnsteuer) and the employee’s social contributions, pay the employer share, and file with the Finanzamt and the social insurance bodies.
For hires from outside the EU who need German work rights, we sponsor the residence and work permit as the legal employer, including the EU Blue Card where the salary qualifies. Your company needs no German presence for any of it.
Not every EOR handles sponsorship. It means you can bring in talent from outside the EU without opening a German company.
Software, engineering, retail, non-profit: the sector changes the pay norms and sometimes the collective agreement that applies, while the employment process itself stays identical.
Flexible Employment Contracts
Onboard in as little as 24 hours
Speed matters when a role is open and the right person is ready to start. Give us their details and we handle the German paperwork quickly, without letting anything slip on compliance.
A simple easy portal
Your German hires, their documents and every payroll task, in a single view.
Stress-free onboarding
German onboarding paperwork is our job, handled by your EOR Germany specialists from offer letter to first payslip.
Accurate German payroll
Payroll lands on schedule with Lohnsteuer and social insurance taken correctly, cycle after cycle.
Predictable pricing
No entity formation bill and no ongoing company admin when you hire through us.
No local entity required
The legal employment sits with us in Germany. The daily work stays under your direction.
Compliance covered
Contracts, leave entitlements, payroll duties and everyday HR questions, all dealt with in-country.
One Dedicated Point of Contact
Reliable, responsive service is what keeps a working relationship strong
Good service starts with understanding your business. You work with one dedicated Germany specialist across onboarding, payroll and day-to-day HR questions, so answers come back quickly and nothing gets lost in handovers.
Get in touchEOR vs. your own entity
Do you need your own German company, or can you use an EOR?
There are two routes to employing in Germany: create a vehicle of your own, a GmbH, a smaller UG or a branch, or hire through an employer of record.
Setting up your own German company
Forming a GmbH ties up €25,000 in share capital, half of it paid in before you begin. The name gets reserved, the articles go before a notary, and the Handelsregister entry follows. Then come the trade office and the Finanzamt.
After that you still need a Betriebsnummer from the Bundesagentur für Arbeit, the social insurance registrations and a Steuerberater for payroll and filings. Realistically the whole sequence runs to several weeks.
- Annual accounts filed with the Handelsregister
- Corporate tax and VAT returns to the Finanzamt
- Running payroll and German employment law compliance
- A Steuerberater or accountant needed
- Running costs in the low thousands each year
Using an employer of record
Your hire joins the payroll of our existing German GmbH. Nothing gets incorporated on your side: no notary appointment, no Handelsregister entry, no local bank account, no year-end accounts. We issue the contract and register the employment.
- No German entity required
- Contract issued within hours
- Payroll, tax, and compliance all handled
- No accountant or Steuerberater needed on your side
- Single monthly invoice covers everything
When does each option make sense?
Use an EOR when…
A handful of German hires, a start date that cannot wait weeks, and no appetite for running a local company: that is the profile the EOR route fits best.
Set up your own entity when…
A bigger, settled German team, or a commercial reason to hold a company of your own, perhaps to contract with German customers or reach local incentives: at that point an entity starts to earn its keep.
There is no fixed headcount where one route becomes the other; it turns on your plans for the German market. Talk it through with us whichever side you land on, or see how we stack up against the best EOR providers in Germany.
Employee Entitlements
What your employees in Germany are entitled to
German employment protection has real teeth, and mistakes end up before the Arbeitsgericht or with the authorities. These are the entitlements to get right.
Annual leave
The statutory minimum is 20 working days a year on a five-day week, which is four weeks. It comes from the Bundesurlaubsgesetz, and most contracts and collective agreements offer more, usually 25 to 30 days. Leave is counted in working days rather than calendar days, so it is worth checking how a contract sets it out.
Public holidays
Public holidays are set by each Bundesland, so the number runs from about 9 to 13 a year. Nine apply across the country and each state adds its own, which means the exact days depend on where the employee is based. Bavaria has the most.
Sick pay
When someone is off sick, the employer keeps paying full salary for up to six weeks (Entgeltfortzahlung). After that the health insurer pays Krankengeld, around 70% of gross pay, for up to 72 more weeks for the same illness. A medical certificate is usually needed from the fourth day, or earlier if the contract asks for it.
Maternity leave
Mutterschutz protects mothers for six weeks before the birth and eight weeks after, extended to twelve weeks for premature or multiple births. Pay is topped up to full net income through Mutterschaftsgeld and an employer contribution, so mothers are not out of pocket during the protected period.
Parental leave
Each parent can take Elternzeit of up to three years for a child, with their job protected while they are away. It can be taken by either parent and split into phases, some of it up to the child’s eighth birthday.
Parental allowance
While a parent is on Elternzeit, they can claim Elterngeld from the state, worth roughly 65% of their previous net income. It runs from €300 to €1,800 a month, so families keep an income while a parent is at home with a young child.
We handle all of this for you
Leave balances, payslip entitlements and upcoming absences are tracked for every employee. Maternity or parental leave arrives with its paperwork already done and the rules followed.
Our Services
What we actually do
Our Employer of Record Germany service takes company formation out of the hiring sequence entirely. The German entity already exists, ours, and your team joins its payroll.
Learn more ›Employ people without a local company
If you want to hire in Germany without setting up a company, we employ your team member as their legal employer and manage the whole employment lifecycle.
Payroll and tax in Germany
We run compliant German payroll, handle Lohnsteuer and social insurance deductions, and file with the Finanzamt and the insurance funds each month.
HR and employment compliance
Practical HR guidance grounded in German employment law and any collective agreement that applies, from onboarding through to contract changes and offboarding.
Employee benefits in Germany
Set up competitive benefits that fit the German market, from supplementary health cover to meal allowances and occupational pension (bAV) arrangements.
Employing in Germany
I want to learn more aboutonboarding|in Germany
German employment throws up questions weekly: rights, leave, benefits, paperwork. With EOR Germany you put them to people who answer exactly these questions every working day.
Germany Employment Guide ›About Us
What makes us different?
We started this to take the friction out of hiring in Germany for international teams. Because we own our German entity rather than routing through a local partner, you deal directly with the people who run your payroll and keep you compliant.
Book a DemoEmployer of record Germany: your questions answered
Yes, and that is precisely what an Employer of Record exists for. The person is employed through our German GmbH, so no company registration, no German bank account and no notary or Handelsregister process ever lands on you.
Usually 24 to 48 hours after the key details reach us. Social insurance registration happens before day one, along with the German contract and the payroll setup. The pace mostly depends on how quickly the information arrives.
Placing employees with a client business is regulated in Germany and needs an AÜG licence, which our entity holds. Traditional staff leasing supplies temporary workers the agency recruited. An EOR employs the specific person you chose, on an ongoing basis.
A fixed monthly fee per employee, agreed before you start. Employment admin, payroll, the Lohnsteuer and social insurance filings and ongoing HR support all sit inside it. No percentage of salary and no surprise items; the detail is on our pricing page.
We can. Agility EOR, the group behind us, specialises in a small set of European countries, so one relationship covers hires in several of them. When your plans continue past Germany, the same team continues with you.
Ready to hire in Germany?
Someone ready to start in Germany? Your EOR Germany team will have them employed, registered and on our payroll within days, not months.
Contract, payroll and compliance on our side. On yours: the person and the work.
Speak to an expert
Get in touch
Start employing in Germany today
Book a consultation today to see how we can help you hire in Germany.