Germany · Employer of Record · Payroll Services · PEO
You have found the person you want to hire in Germany — now you need a compliant way to employ them. JN Recruitment is the expansion partner that connects international companies with vetted Employer of Record and payroll partners in Germany — plus the employment lawyers, tax advisors, payroll bureaus and accountants a German expansion actually needs — and delivers the boutique recruitment that finds the candidate in the first place.
for an EOR to issue a compliant German employment contract once documents are complete
employer social contributions on a German gross salary — budgeted before you make the offer
no GmbH required — with an Employer of Record, the partner is the legal employer in Germany
our recommendation is free — the best specialist from our vetted German network, matched to your case
Payroll partner Germany
Germany is the largest economy in Europe — and one of the most demanding places to put someone on a payroll. An employment contract under German law, wage tax via ELStAM, registrations with a Krankenkasse and the accident insurer, monthly Lohnabrechnung, employee-friendly dismissal protection: none of it is optional, and all of it lands before your new hire receives a first payslip. Companies that have already found their candidate lose weeks here — or worse, improvise with a freelance contract that German authorities later reclassify.
There are two clean routes. If you have (or will build) a German entity, a payroll service provider in Germany runs the monthly payroll, filings and registrations for you. If you have no entity and don’t want one yet, an Employer of Record (EOR) employs your hire legally in Germany while you direct the day-to-day work — what many US companies would call a PEO. The market for both is crowded and opaque; licences, service depth and pricing vary enormously. And sooner or later a German expansion also needs an employment lawyer for the contract, a tax advisor (Steuerberater) for the registrations and an accountant for the books. We vet all of it for you.
JN Recruitment is a boutique recruitment firm headquartered in Mannheim — and the expansion partner international companies use for the German market. Years of placing people in Germany have built us a network of the best employment lawyers, tax advisors, payroll bureaus (Lohnbüros), accountants and licensed EOR providers in the country. We recommend exactly the specialists your case needs — free of charge, at the partner’s standard rates — and stay your single point of contact. What we deliver ourselves is the headhunting: the sales recruitment agency for Germany that international machinery, industrial-technology and recycling companies already use to enter the market.
What we arrange
Whatever stage your Germany plans are at — first hire without an entity, or a full team on an existing GmbH — this is what our vetted German network delivers: EOR providers, payroll bureaus, employment lawyers, tax advisors and accountants, matched and introduced by us:
The partner becomes the legal employer of your hire in Germany — German employment contract, payroll, social insurance, wage tax — while you manage the work day-to-day. Live within days, no GmbH required. The standard route for a first hire in Germany.
For companies with a German entity: a specialised payroll bureau runs the monthly Lohn- und Gehaltsabrechnung, wage-tax filings to the Finanzamt, social-insurance notifications, payslips and DATEV-compatible reporting — no in-house German payroll expertise needed.
Searching for a “PEO Germany”? The US-style PEO doesn’t exist 1:1 under German law — the compliant equivalents are EOR employment or outsourced payroll on your own entity. We translate what you actually need into the right German construct.
Specialised employment lawyers for watertight German contracts and dismissals, tax advisors (Steuerberater) for registrations and filings, accountants for the books — the advisory bench every German expansion eventually needs, already vetted and briefed.
Onboarding paperwork, absence tracking, certificates and statutory registrations — plus audits of German freelance setups: authorities actively reclassify disguised employment (Scheinselbstständigkeit), and partners convert contractors into compliant employment before that happens.
The part we deliver ourselves: executive search for technical sales and leadership roles in Germany. If you don’t have the candidate yet, we find them — then plug employment and payroll in behind the signed offer.
Market knowledge
German employment is rule-dense but predictable — if you know the numbers before you sign. The essentials we brief every company on before a German hire:
EOR employment in Germany runs under the labour-leasing act (AÜG): the provider needs an Arbeitnehmerüberlassung licence, and the same employee may be leased for a maximum of 18 months. A serious Germany plan uses EOR as the bridge — and has the own-entity switch mapped before month twelve. We flag this in every introduction.
Germany’s minimum wage rose to €13.90 per hour in January 2026 and rises again to €14.60 in 2027. Professional salaries sit far above it, but the floor matters for junior, part-time and industrial roles — and collective agreements (Tarifverträge) can set higher sector minimums that also bind an EOR.
A six-month Probezeit with two-week notice is standard. After it, the Kündigungsschutzgesetz applies in businesses with more than ten employees, and notice periods grow with tenure. German contracts must be right from day one — which is exactly why cut-price payroll setups get expensive later.
Betriebsnummer (employer number), health-insurance registration, ELStAM wage-tax enrolment, statutory accident insurance, DEÜV social-security notifications — a first-time employer in Germany clears this checklist before payroll can even run. It is the single biggest time sink an EOR or payroll partner removes.
Employer cost benchmarks
Payroll quotes in Germany are built on the statutory social contributions both sides pay on gross salary. The 2026 picture — the source of the “roughly 21% on top” rule every employer budget should use:
| Contribution | Employer pays | Employee pays |
|---|---|---|
| Pension insurance (Rentenversicherung) | 9.3% | 9.3% |
| Health insurance (statutory, incl. avg. insurer top-up) | ≈8.6% | ≈8.6% |
| Long-term care insurance (Pflegeversicherung) | 1.8% | 1.8–2.4% |
| Unemployment insurance (Arbeitslosenversicherung) | 1.3% | 1.3% |
| Statutory accident insurance (Berufsgenossenschaft) | ≈1.1–1.6% | — |
| Employer levies (U1/U2 sickness & maternity, insolvency) | ≈1–3% | — |
Orientation figures for 2026, rounded: health-insurance top-ups vary by insurer, accident insurance by sector, U1 applies to smaller employers, and contribution ceilings (Beitragsbemessungsgrenzen) cap most items. Rule of thumb: a €70,000 gross salary costs the employer roughly €85,000 all-in. Your payroll or EOR partner’s quote is the binding number.
Yes. An Employer of Record (EOR) employs your candidate in Germany on your behalf: the EOR holds the German employment contract, runs payroll and social insurance, and you direct the day-to-day work. No GmbH, no German bank account, no registrations on your side. It is the standard route for a first hire in Germany — with one German particularity: EOR runs under the labour-leasing act (AÜG) and is capped at 18 months per employee, so plan the switch to your own entity if the role is permanent.
The EOR is the legal employer under German law. It issues a compliant German employment contract, registers the employee with a health insurance fund and the social-security system, withholds wage tax via ELStAM, pays social contributions, issues monthly payslips, administers vacation and sick leave, and handles statutory notifications. You remain in charge of the work itself — targets, tasks, tools, day-to-day management — and reimburse the EOR for gross salary, employer contributions and a service fee.
Typical German EOR pricing is a flat €300–700 per employee per month, or a percentage of gross salary — on top of the salary itself and roughly 21% employer social contributions. Compare that with the alternative: forming and running a GmbH means formation costs, share capital, accounting, annual filings and a local payroll setup — rarely worth it below three to five employees. We match you with a partner whose pricing fits your head-count and flag the all-in monthly number before you commit.
Budget roughly 21–22% employer social contributions: pension (9.3%), health insurance (≈8.6% including the average insurer top-up), long-term care (1.8%) and unemployment insurance (1.3%) — plus statutory accident insurance and small employer levies that vary by sector and company size. Contribution ceilings cap several items for high earners. As a rule of thumb, a €70,000 gross salary costs the employer roughly €85,000 all-in per year, before any bonus, car or EOR fee.
In the US, a PEO co-employs your staff while you keep your own entity; an EOR employs them fully so you don’t need one. German law has no 1:1 equivalent of the US PEO model — the compliant German constructs are EOR employment under an AÜG licence (no entity needed) or outsourced payroll and HR administration on your own GmbH. Providers use both labels loosely, which is precisely why we check what a partner actually delivers before we introduce them.
Yes — if it is done properly. EOR in Germany is legally Arbeitnehmerüberlassung (labour leasing) and requires a licence from the Federal Employment Agency, equal-treatment rules apply, and the 18-month maximum leasing period per employee is enforced. An unlicensed provider exposes you to fines and a deemed employment relationship with the worker. Licence status is the first thing we verify in our partner vetting — and a question you should ask any EOR you talk to.
Yes. If your GmbH or branch already exists, a German payroll partner takes over the monthly Lohn- und Gehaltsabrechnung: payslips, wage-tax filings to the Finanzamt, social-insurance notifications to the Krankenkassen, DATEV-compatible exports for your accountant, plus year-end certificates. Typical pricing runs per payslip per month. The same partners handle the employer registrations if your entity has never employed anyone in Germany before.
Via EOR: the German employment contract is typically ready within three to five working days once the candidate’s documents are complete — the fastest compliant route into the German market. Building your own entity first takes weeks to months including employer registrations. In practice the binding constraint is usually the candidate’s notice period with their current employer, one to three months for most German professionals — which, as recruiters, is the part we actively manage for you.
Only if they are genuinely self-employed. Germany polices disguised self-employment (Scheinselbstständigkeit) hard: the pension authority runs status audits, and a reclassified freelancer means back-dated social contributions — paid largely by you — plus a deemed employment contract. One client, fixed working hours and integration into your team are classic red flags. If the working reality is employment, EOR employment costs little more and removes the risk; our partners also audit and convert existing contractor setups.
No — and that is deliberate. JN Recruitment is a boutique recruitment firm and your expansion partner for Germany: over years of placing candidates here we have built a vetted network of the best employment lawyers, tax advisors (Steuerberater), payroll bureaus, accountants and licensed EOR providers — and we recommend exactly the specialists your case needs. You contract directly with the partner at their standard rates; the recommendation costs you nothing, and we stay your single point of contact. What we deliver ourselves is the search: if the candidate doesn’t exist yet, our German headhunting finds them.
Across Europe
The same specialised technical sales search opens every market on the continent — pick the country you are expanding into.
Hiring in several markets at once?
Hiring at leadership level? Our executive search practice:
Candidate found — and now need a compliant way to employ them?
Talk to us — no strings attached. We get back to you within 24 hours.
Our mission is simple: placements that open new markets.
30-minute intro call
Two quick steps — tell us what you need and how to reach you. Within one business day you get an intro call and, where it fits, a direct introduction to the right specialists from our vetted network.
Your contact person Jonas Strambach Director & Senior Recruiter, JN Recruitment +49 1525 2077583 [email protected] Thank you — we’ll get back to you within one business day to schedule your intro call.
An honest read on your vacancy & market — in your first call.
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Before you go
Every month a key sales seat stays empty pushes your expansion plans back — and leaves serious revenue on the table. We fill technical sales positions within weeks, so you hit your expansion targets on schedule.
Jonas Strambach Director & Senior Recruiter, JN Recruitment Free vacancy check · reply within 24 hours
