Minimum wage to be raised in 2017

  • Germany
  • 06/30/2016
  • Berry Appleman & Leiden LLP

What is the change? Germany’s Minimum Wage Commission has recommended an increase in the minimum wage in 2017 from €8.50 to €8.84 per hour (from approximately US$ 9.41to $9.79 per hour).

What does the change mean? Businesses should budget for the 4-percent increase which will take effect Jan. 1, pending government approval.

  • Implementation time frame: Jan. 1, 2017.
  • Visas/permits affected: All work and residence permits.
  • Who is affected: All companies employing or assigning workers in Germany.
  • Business impact: The minimum wage increase will affect corporate budgets and the cost of sending workers to Germany.
  • Next steps: Companies should prepare for the increase and plan to meet the salary threshold for new hires in 2017 as well as for extension applications as of January 2017.

Background: Germany introduced the €8.50 minimum hourly wage on Jan. 1, 2015. The Minimum Wage Commission reviews the threshold every two years.

BAL Analysis: This is the first increase in Germany’s minimum wage since its introduction two years ago. The increase could significantly impact companies whose salaries are set at the current minimum wage.

This alert has been provided by the BAL Global Practice group and our network provider located in Germany. For additional information, please contact your BAL attorney.

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