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The increase in the minimum wage was already decided in 2023. It is based on the Minimum Wage Act and the Act to Increase Protection through the Statutory Minimum Wage and Amendments in the Area of Marginal Employment.
According to the Fourth Minimum Wage Adjustment Ordinance (MiLoV4), the minimum wage has been set as follows:
- From January 1, 2024: €12.41 gross per hour
- From January 1, 2025: €12.82 gross per hour
Important: Consider the impact of the minimum wage on employment contracts!
As always, the increase in the minimum wage may affect existing employment contracts. This is especially relevant if you employ mini-jobbers or midi-jobbers. Without adjusted contracts, employees may either earn too little for the same number of hours or work too many hours per month for the same income (Mini-job thresholds: €538/month in 2024; €556/month in 2025; Midi-job: up to €2,000/month).
Special case for 2025: With the increase in the mini-job income limit, the maximum allowable working hours will also rise slightly (43.35 hours/month in 2024; 43.37 hours/month in 2025). If you want to maintain the "old" salary, however, the working hours must be reduced accordingly.
More information about mini-jobs and midi-jobs can be found in our article: "If You Want to Employ Mini-Jobbers."
For full-time or part-time employment, you must also consider the minimum wage, especially if you pay a fixed monthly salary rather than calculating based on working hours.
For instance, in months with 23 working days, the minimum wage for full-time employees as of January 1, 2024, must be at least €2,283.44 (€12.41/hour x 184 hours). Starting January 1, 2025, it must be €2,358.88 (€12.82/hour x 184 hours).
If salaries fall below these thresholds in such months, it constitutes a violation of the Minimum Wage Act.
However, the Audit Service of the German Pension Insurance has stated that it will accept a staggered gross salary calculation based on the formula:
weekly working hours x 13 : 3 x €12.41 (or €12.82 from 2025).
Note that this is not legally regulated and therefore not entirely secure.
What happens if you violate the Minimum Wage Act?
Potential consequences include:
- Back payment obligation: Employers must pay the missing amount to meet the minimum wage requirement.
- Penalties and fines: Violations can lead to fines for the company.
- Employee claims: Employees have the right to demand outstanding amounts and may enforce this through legal action if necessary.
Tips and Resources
Further tips and information can be found in the BMAS brochure "The Minimum Wage – Questions and Answers" and the Federal Government's FAQ on the topic.
The minimum wage calculator available on the BMAS website is also useful. It allows you to calculate the required salary for a specific number of hours to comply with the minimum wage ("Calculate Monthly Salary"). Conversely, it can check whether the salary you currently pay will suffice for the agreed working hours in the coming year ("Calculate Hourly Wage").
Note: The calculator assumes average working days per month. For months with 23 working days, higher compensation is required (as detailed above).
