Minimum wage: Further relaxation of the documentation obligations
Since the statutory minimum wage of EUR 8.50 per hour was introduced, the administrative obligations in respect of the minimum wage continue to frustrate employers. Companies with employees in irregular or temporary positions or employees in specific industries (e.g. industrial cleaning, logistics or construction) are obliged to record the start, end and duration of the daily working time of their employees and to keep these records for two years.
In December 2014, the documentation obligations were relaxed by several regulations issued by the legislator in respect of certain groups of employees and job profiles. The changes included:
- The documentation obligations no longer apply to employees who earn more than EUR 2,958.00 gross per month.
- If the employee exclusively carries out mobile activities and can independently schedule their working time, only the duration of the daily working time is to be recorded (not the start and end working time).
- If specific conditions are fulfilled, the number of documents that have to be provided by employers to their registered office abroad, pursuant to the German Minimum Wage Act (Mindestlohngesetz, MiLoG), is reduced.
These changes alone, however, were insufficient for most employers who still faced a heavy administrative burden, in particular with regard to employees with ‘Mini-jobs’ (designated employment contracts with capped, low earnings, usually part time hours and with special tax and insurance treatment). The government responded to the employers' arguments that the documentation obligations were still burdensome and on 29 July 2015, the law was amended to reflect that the documentation obligations no longer apply if:
- the regular salary of the employee exceeds EUR 2,000.00 gross; and
- it can be proven that the monthly salary was paid in respect of the previous twelve months.
Furthermore, on 1 August 2015 a new regulation came into force which means that the documentation obligations no longer apply to the employment of close family members (spouse, civil partner, children and parents of the employer).
Another relevant decision with regard to minimum wage was recently passed by Düsseldorf Labour Court (decision dated 20 April 2015, file ref.: 5 Ca 1675/15). The court decided that, in addition to the base salary, any performance bonus that has been paid and cannot be rescinded also counts towards the minimum wage.
The question regarding which benefits count towards the minimum wage (apart from the base salary) has not yet been unanimously answered by the courts and continues to be a controversial topic under discussion in Germany. This matter can only be settled with a decision from the German Federal Labour Court. Employers should therefore keep a close eye on further developments.