As of 1 January 2013, the provisions relating to so-called mini jobs and midi jobs are amended. For employments at low pay rates (mini jobs) the pay limit is increased from Euro 400.00 to Euro 450.00. For employees in the sliding contribution scale zone (midi jobs) the pay limit is increased by the same amount. The sliding contribution scale zone then ranges from Euro 450.01 to Euro 850.00.
In addition to the change of the new limits the duty to pay pension insurance contributions is changed. While according to the previous legislation the mini jobbers were generally exempted from taking out insurance with an option of full compulsory insurance, the jobbers are subject to pension insurance contributions with an option to be granted exemption in future. Thus, the mini jobbers equal the status of an employee subject to pension insurance contributions.
The new provisions apply to all mini job employments as of 1 January 2013. Transitional and grandfathering provisions for existing mini jobs are in force.
In the operational practice, mini jobbers are increasingly employed and with the increase of the pay limits it is foreseeable that this trend will continue. It has to be noted that mini jobber are frequently handled wrongly.
Employers should observe a few guidelines:
- Mini jobbers and other employees are equal under the labor law. They are only assessed differently under social security and tax law. For example, if a mini jobber is to be dismissed the works council must be consulted. Moreover, all mandatory legal provisions such as the entitlement to vacation are applicable.
- The pay limits must be strictly observed, since otherwise the benefits arising from tax and social security law will be cancelled. In the calculation of the regular monthly pay the collective agreements and works agreements applicable to the business establishment must be taken into account. The limit of Euro 450.00 (Euro 5,400.00/year) can be reached very quickly here. Moreover, regular annual payments such as Christmas allowance or a vacation bonus have to be added to the pay.
It has ultimately to be expected that the pension insurance Bund will in future even more look into the employment of mini jobbers within the audit of business establishments under social security law (Section 28p SGB IV [German Social Security Code IV]). This is above all triggered by the political pressure, since the change to the pay limits has been strongly criticized because it is liable to cause an increase of part-time employment.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.