Employer of record in Germany: cost and rules (2026)

Employing someone in Germany costs the employer about 24.8% on top of gross salary in statutory contributions, plus an EOR fee of $199 to $699 per month at providers that publish prices ("from" prices). Example: a gross salary of EUR 6,000 per month costs EUR 7,489 per month (about $8,289) before any EOR fee.

Rates checked: 2026-11-14. The employer pays about half of the statutory pension, unemployment, health and long-term care insurance, plus several small levies: sick-pay and maternity reimbursement schemes, an insolvency levy and accident insurance. Each insurance stops charging above its own monthly earnings ceiling, and the health and care ceiling is lower than the pension and unemployment one. There is no mandatory 13th salary. Estimates only, not advice: see the note at the bottom of the page.

Employer contributions in Germany

Employer contribution	Rate	Base and limits	Source
Pension insurance (Rentenversicherung), employer half	9.3%	gross pay; capped at EUR 8,450/month The total rate is 18.6%, split equally. The 2026 monthly ceiling is EUR 8,450 (EUR 101,400 a year), the same in all of Germany. Pay above it is not charged.	Deutsche Rentenversicherung, Werte der Rentenversicherung 2026; BMAS ordinance 2026
Unemployment insurance (Arbeitslosenversicherung), employer half	1.3%	gross pay; capped at EUR 8,450/month The total rate is 2.6%, split equally. It uses the same EUR 8,450 monthly ceiling as pension insurance.	Deutsche Rentenversicherung, insurance values 2026; BMAS ordinance 2026
Statutory health insurance (Krankenversicherung), employer half	8.75%	gross pay; capped at EUR 5,813/month The general rate of 14.6% is split equally, so the employer pays 7.3%. The employer also pays half of each fund's extra contribution (Zusatzbeitrag). We use the official 2026 average extra rate of 2.9%, so the employer half is 1.45%. Each fund sets its own rate, so the real figure differs a little. The 2026 monthly ceiling is EUR 5,812.50 (EUR 69,750 a year). Employees above the compulsory-insurance threshold may choose private insurance, where the employer pays a subsidy instead.	Federal Ministry of Health, GKV contribution rates 2026; BMAS ordinance 2026
Long-term care insurance (Pflegeversicherung), employer half	1.8%	gross pay; capped at EUR 5,813/month The total rate is 3.6%, split equally, so the employer pays 1.8%. Saxony is different: the employer pays 1.3% there and the employee 2.3%. We use the standard 1.8% for all of Germany. The childless surcharge is paid by the employee alone. The monthly ceiling is EUR 5,812.50, the same as for health insurance.	Federal Ministry of Health, financing of social care insurance
Sick-pay reimbursement levy (Umlage U1)	2.1%	gross pay; capped at EUR 8,450/month Employers with up to 30 employees pay this levy to the health fund, which then refunds part of the sick pay the employer paid. Rates are set by each fund and by the refund level chosen. We use 2.1%, the standard level at one large fund (70% refund) in 2026. Funds range roughly from 0.8% to about 4.9%. Larger employers do not take part. Calculated on pay up to the pension ceiling.	Techniker Krankenkasse, U1 and U2 rates 2026; Minijob-Zentrale secondary
Maternity-cost levy (Umlage U2)	0.44%	gross pay; capped at EUR 8,450/month All employers pay this levy to the health fund, which refunds maternity-related pay costs in full. The rate is set by each fund. We use 0.44% (2026 rate at one large fund). The Minijob-Zentrale's own rate is 0.22%.	Techniker Krankenkasse, U1 and U2 rates 2026; Minijob-Zentrale secondary
Insolvency-pay levy (Insolvenzgeldumlage)	0.15%	gross pay; capped at EUR 8,450/month A uniform levy paid together with the social insurance contributions. The rate is 0.15% in 2026.	Minijob-Zentrale, taxes and charges for employers
Accident insurance (Berufsgenossenschaft)	1.3%	gross pay Paid by the employer alone to the trade accident insurer. The cost depends on the industry's hazard class and the insurer's yearly rate, so it varies a lot. We use 1.3%, the long-term average given by the DGUV. It is billed once a year after the fact.	DGUV (German Social Accident Insurance), contributions

Minimum wage: EUR 2,409 per month. The statutory minimum is EUR 13.90 per hour from 1 Jan 2026 and EUR 14.60 per hour from 1 Jan 2027. The monthly figure is our conversion, assuming a 40-hour week (13.90 x 40 x 52 / 12 = 2,409.33). Real monthly pay depends on the hours agreed. Source: BMAS, Fifth Minimum Wage Adjustment Ordinance (MiLoV5)

Worked example: EUR 6,000 gross per month

Item	Base (EUR)	Per month (EUR)
Pension insurance (Rentenversicherung), employer half	6,000	558
Unemployment insurance (Arbeitslosenversicherung), employer half	6,000	78
Statutory health insurance (Krankenversicherung), employer half	5,813	509
Long-term care insurance (Pflegeversicherung), employer half	5,813	105
Sick-pay reimbursement levy (Umlage U1)	6,000	126
Maternity-cost levy (Umlage U2)	6,000	26
Insolvency-pay levy (Insolvenzgeldumlage)	6,000	9
Accident insurance (Berufsgenossenschaft)	6,000	78
Gross salary		6,000
Total employer cost (mandatory items)		7,489

Contractor, EOR or own entity in Germany

Option	Per month	Per month (USD)	Per year	Notes
Contractor	EUR 6,005 to EUR 6,044	$6,646 to $6,690	EUR 72,054 to EUR 72,531	No employer contributions. Misclassification risk. Includes the contractor-management fee range (management plans only).
Employer of record	EUR 7,668 to EUR 8,120	$8,488 to $8,988	EUR 92,021 to EUR 97,442	Salary + statutory costs + EOR fee range.
Own legal entity	EUR 7,489	$8,289	EUR 89,863	Salary + statutory costs. Setup, accounting and legal costs are not estimated.

Contractor

If a contractor works under the client's instructions, at set times and inside its organisation, German authorities can treat the work as employment. The client then owes back social insurance contributions, and the risk is called false self-employment (Scheinselbständigkeit). Either side can ask the Deutsche Rentenversicherung for a status determination (Statusfeststellungsverfahren) to get a binding answer. A genuine freelancer pays their own taxes and arranges their own insurance. Source: SGB IV §7a (Statusfeststellung)

Own entity

A private limited company (GmbH) needs share capital of at least EUR 25,000, and at least half of that must be paid in before registration. It exists only once it is entered in the commercial register, which needs a notarised deed. A smaller form, the UG (haftungsbeschränkt), can start with as little as EUR 1 of capital. You also need a German address, a business bank account and registrations with the tax office, the health funds and the accident insurer before you can pay staff. Source: GmbHG §5 (Stammkapital)

Leave, notice, probation and termination

Annual leave: 20 days. The Federal Leave Act sets 24 working days on a 6-day week, which is 20 days on a 5-day week. Contracts and collective agreements often give 25 to 30 days.

Public holidays: 9. These apply in every state (New Year, Good Friday, Easter Monday, 1 May, Ascension, Whit Monday, 3 October, 25 and 26 December). States add their own, such as Epiphany, Corpus Christi or Reformation Day, so the total is 9 to about 13 depending on the state. Source: Federal Leave Act (BUrlG), sec. 3; public holidays are set by state laws

Notice

The basic notice period is 4 weeks, to the 15th or the end of a calendar month. For notice given by the employer it grows with length of service: 1 month after 2 years, 2 months after 5, 3 months after 8, 4 months after 10, 5 months after 12, 6 months after 15 and 7 months after 20 years, always to the end of a month. An employee's own notice stays at 4 weeks unless the contract says more. During an agreed probation of up to 6 months, either side can give 2 weeks' notice. Source: BGB §622 (Kündigungsfristen)

Probation

A probation period of up to 6 months can be agreed in the contract. It must be reasonable for the job. The general protection against dismissal does not apply in the first 6 months of employment. Source: KSchG §1 (dismissal protection); BGB §622(3) (probation)

Termination

There is no general statutory severance. If the employer has more than 10 employees and the worker has been employed for over 6 months, the Protection Against Dismissal Act requires a valid reason (conduct, personal or business reasons), and the dismissal can be challenged in labour court. A court case or settlement often ends with a payment. The Act also offers an option of half a month's pay per year of service if the employer states in the dismissal that it is for business reasons and the employee does not sue. Works council rules and collective agreements may add more. Source: KSchG §1a (severance option)

What the calculator simplifies

Each health fund sets its own extra contribution. We use the official 2026 average, with the employer paying half.
Saxony: the employer's care insurance share is lower there (1.3% instead of 1.8%). We use 1.8% everywhere.
The U1 and U2 levies differ by health fund and refund level. We use one large fund's standard rates. U1 does not apply to employers with more than 30 employees.
Accident insurance is shown as a flat average. Real cost depends on the industry hazard class and is capped at a maximum annual earnings amount.
Public holidays differ by state: 9 apply everywhere and most states have more.
Employees above the compulsory-insurance threshold can use private health insurance, where the employer pays a capped subsidy instead. This is not modelled.
Minijobs and midijobs (low earnings) follow different rules and are not modelled.
The monthly minimum wage is our conversion from the hourly rate, assuming a 40-hour week.

EOR provider prices

Provider	EOR price (USD)	Contractor price (USD)	Billing and deposit	Source and checked
Skuad	from $199 Starting price	from $19 Contractor management from $19; agent of record from $99	Not published Deposit: Not published	price page 2026-11-13
Multiplier	from $459 On annual contracts; $499 on monthly. Add-ons and setup fee may apply	from $400 (contractor of record) Contractor of record from $400 per contractor per month	Annual or monthly contracts (annual about 8% cheaper) Deposit: Not published	price page 2026-11-13
Papaya Global	from $499 Starting price per employee per month	from $5 Contractor solution from $5; contractor of record from $199	Not published Deposit: Not published	price page 2026-11-13
RemotePeople	from $499 EOR Global from $499; a cheaper 'Select' plan from $199 has conditions on country and salary	from $29 Contractor management $29 (the page says per payout in one place and per contractor per month in another)	Not published Deposit: Not published	price page 2026-11-13
Deel	from $599 Starting price	from $49 Contractor plan from $49; contractor of record from $325	Not published Deposit: Not published	price page 2026-11-13
G-P (Globalization Partners)	from $599 Starting price	from $39 From $39 per contractor, charged only in months with a paid invoice	Not published Deposit: Not published	price page 2026-11-13
Remote	from $599 Starting price on annual contracts	from $29 Contractor management $29; Plus (with misclassification protection) $99; contractor of record $325	Annual contracts for EOR Deposit: No setup or onboarding fee and no standard deposit; a refundable reserve may be required in some cases (amount confirmed at onboarding)	price page 2026-11-14
Oyster	from $699 List price; annual billing discount exists (amount not published)	from $29 Global contractors $29 per contractor per month, 30-day free trial	Monthly or annual Deposit: No setup, onboarding or offboarding fee; refundable deposit for EOR employees (amount not published)	price page 2026-11-14
Rippling	Price on request (custom quote)	Price on request	Not published Deposit: Not published	price page 2026-11-13

Prices are "from" (starting) prices as shown on each provider's own page, usually per employee per month. What you pay can be higher and depends on country, headcount and contract length. Sorted by price, lowest first; providers that publish no price come last.

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Calculator for Germany

FAQ

How much does it cost to employ someone in Germany?

On top of gross salary, statutory contributions and mandatory accruals add about 24.8% at a gross salary of EUR 6,000 per month. That is a total of EUR 7,489 per month before any EOR fee.

How much does an employer of record cost in Germany?

Providers that publish a price list charge $199 to $699 per month for EOR plans ("from" prices, checked 2026-11-14). This is on top of salary and the statutory employer costs above. Source

How much paid leave do employees get in Germany?

Annual leave is 20 days, plus 9 public holidays. The Federal Leave Act sets 24 working days on a 6-day week, which is 20 days on a 5-day week. Source

What is the notice period in Germany?

Is there a probation period in Germany?

What are the rules on ending employment in Germany?

Sources

Rates checked: 2026-11-14.