How to create offer letters for employees in Germany
After you’ve interviewed all the candidates and selected the person you think is the best fit for an open position, it’s time to take the next step in the hiring process: Sending the lucky applicant a job offer letter.
When you’re getting ready to hire an employee in Germany, drafting an offer of employment is an important step. In this document, you’ll discuss the details of the position and also start the process of negotiating the salary and benefits. An offer letter also protects you from any consequences of not following German labor codes.
Here’s everything you need to send a legally compliant offer letter to hire a full-time employee in Germany.
Germany job offer letter checklist
- Position (job title), job description, start date, and probationary period. In addition to their official job title and a description of their duties, include the commencement date in the offer letter. Let the employee know they’ll be undergoing a trial period to ensure they are suitable for the position. In Germany, probationary periods usually last around six months and state the company’s policy on termination during this time. Generally, it’s acceptable for either party to terminate the employment contract with two weeks’ notice during probation – no explanation required.
- Definition of workplace. Specify whether the employee is expected to commute to an on-site location or if they’ll be able to perform their duties from home.
- Compensation & Benefits.
- Salary. In addition to the amount of the employee’s annual salary, indicate when they’ll be paid each month. Typically, workers in Germany receive paychecks either in the middle or at the end of the month.
- Benefits. While specific details about the benefits the employee will receive isn’t expected until you draw up an employment contract, it’s helpful to include some general information about company benefits in the initial job offer letter. The following are statutory benefits for full-time employees in Germany:
- Retirement pensions
- Unemployment insurance
- Healthcare benefits
- Long-term / nursing care
- Workers’ compensation
- Vacation days. Specify how much paid vacation time the new employee can expect to receive each year. Under German labor laws, workers can expect – at minimum – 20 days of vacation if they have a five-day work week and 24 days if their work week lasts six days.
- Working hours. Clearly state the new hire’s expected working hours and the company’s overtime policies. The average work week in Germany is around 36 to 40 hours, and the Hours of Work Act put a strict cap on the number of hours people can work in a day: eight. Furthermore, if an employee is required to work on a Sunday or a public holiday, you are expected to compensate them with a day off within the next two weeks. Additionally, specify whether their work week will be five or six days long, as this will affect some benefits the team member receives. Include your company’s policies on overtime and whether you’ll compensate the new employee with additional money or vacation time for working extra hours. For more on working hours and overtime, read our guide to hiring in Germany.
- Sick leave. Explain your company’s sick leave policies, including the process for notifying direct managers in the event of an illness. Generally, if an employee is sick for less than three days, their employer isn’t obligated to provide them with paid leave. Should their illness last four days or more, the company they work for is expected to pay them their regular salary for up to six weeks as long as their manager receives a legitimate doctor’s note.
- Termination policy. Include information on your company’s policy on termination. Give the reasons employees can be dismissed and how much notice they should expect to receive. In Germany, the length of the notice period directly corresponds to how long a person has been working for the company. Once an employee has been working for more than six months at the same business, they’re protected from unfair dismissals, and the onus is on the employer to provide a written notice that clearly explains why they are being dismissed. Note that if the employee in question is a disabled individual or a pregnant woman, you must take the steps to notify the proper authorities first and get their approval before you can issue a dismissal notice.
- Contact information and phone number.
- Non-compete and non-solicit agreements. If the employee is subject to a non-compete or non-solicitation clause, include the provisions in the job offer letter. Note that, under German labor laws, companies are not permitted to prevent their workers from seeking jobs at competing businesses after they are no longer employed for the initial company unless that company is willing to pay them until the agreement is no longer valid. Furthermore, be aware that non-compete and non-solicit agreements can last for a maximum of two years.
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Disclaimer: Rippling and its affiliates do not provide tax, legal or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for tax, legal, or accounting advice. You should consult your own tax, legal, and accounting advisors before engaging in any related activities or transactions.
