How the minimum wage has developed in Germany
Since its introduction in 2015, the minimum wage has become an established part of the German labour market. It is meant to ensure that employees receive fair pay for their work. The Minimum Wage Commission (Mindestlohnkommission) regularly reviews and adjusts its level to reflect wage trends and the cost of living.
Minimum wage 2025: what is changing?
The most important question for many business owners is, of course: how high will the minimum wage be in 2025? On 1 January 2025 the statutory minimum wage in Germany rose to €12.82 per hour. Since 1 January 2026 it has been €13.90 per hour. The increase is based on the Minimum Wage Commission's recommendation of June 2024 and was implemented accordingly under the Minimum Wage Act.
Important: find out about expected increases early and analyse the effect on your own staff costs.
Who is entitled to the minimum wage?
In principle, almost all employees in Germany are entitled to the minimum wage. There are some exceptions, though:
- Apprentices: special training allowances apply to apprentices, governed by the Vocational Training Act (BBiG).
- Interns: interns are only entitled to the minimum wage if the internship is voluntary and lasts longer than three months. There is no entitlement for mandatory internships completed as part of vocational training or a degree.
- Long-term unemployed people: in the first six months after taking up employment, deviations from the minimum wage can be agreed under certain conditions.
How the minimum wage affects companies
Raising the minimum wage has several effects on companies:
- Rising staff costs: this is the most obvious effect. Companies have to adjust their pay structures and may need to raise prices to cover the higher costs.
- Adjusting working time models: some companies respond to the rising minimum wage by adjusting working time models or increasing efficiency.
- Documentation obligations: companies must record the working hours of their mini-jobbers and of employees who receive the minimum wage. This allows checks by customs (Zoll) and is meant to ensure the minimum wage is actually paid.
Tips for implementing the new rules
To implement the new minimum wage rules smoothly, we recommend the following steps:
- Analyse your current pay structure: check which employees currently receive the minimum wage and how the increase affects your overall pay structure.
- Calculate staff costs: work out how rising wage costs affect your company and adjust your prices if necessary.
- Review working time models: check whether your current working time models are still efficient or need adjusting.
- Meet documentation obligations: make sure you record your employees' working hours correctly to avoid problems during customs inspections.
- Communicate with employees: tell your employees about the changes early and explain the background.
Legal basis
The minimum wage is governed by the Minimum Wage Act (MiLoG). The law sets the level of the minimum wage and regulates the inspection powers of customs.
Conclusion
The minimum wage is an important tool for securing fair pay for employees. For companies, it is also a challenge that needs to be managed. By planning early and implementing the new rules, you can make sure your company stays successful in the future.
