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30 December 2016

What is new in 2017

Workers who are posted to Germany from abroad must, during the time they are working in this country, be granted the terms of employment that apply in Germany – such as minimum wage and minimum holiday leave. For this reason, employers domiciled in countries outside Germany, companies that send leased/temporary employees to Germany and companies that lease employees from temporary employment agencies domiciled abroad are required to register these employees with German Customs and to confirm that the terms of employment applicable in Germany are being complied with. Previously, these registrations have been regularly filed by fax. Starting on 1 January 2017, registrations should be filed online using the minimum wage registration website which can be accessed directly at www.meldeportal-mindestlohn.de or via the German Customs website www.zoll.de.

3d Grafik mit Schriftzug Jahreswechsel von 2016 auf 2017
Source:  fotolia, fotomek

Notification requirement

The Minimum Wage Act (Mindestlohngesetz), Posted Workers Act (Arbeitnehmer-Entsendegesetz) and Temporary Employment Act (Arbeitnehmerüberlassungsgesetz) contain a notification requirement for employers outside Germany who post workers to Germany in certain industry sectors. Users of labour supplied by temporary employment agencies outside Germany are also required so submit notifications.

In the past, these notifications had to be submitted to the customs administration on paper using the forms provided. To simplify the procedure for all those involved, new legal provisions are now in place that allow notifications to be filed electronically. The current paper procedure is based on a partly automated IT system; notifications are received on a fax server and then forwarded.

The volume of notifications has been rising steadily following the inclusion of additional industries in the Posted Workers Act, the introduction of a statutory minimum wage, and corresponding notification requirements for additional industries. To ensure modern and efficient notification and e-government procedures, the customs administration has set up a registration website that allows notifications to be submitted online starting on 1 January 2017.

Background and purpose of the notification requirement

The notification requirement allows the customs administration to monitor compliance with mandatory working conditions. Because posted workers are often in Germany for short periods of time only, and because there are only limited notification requirements under commercial and trade law for employers that (a) are domiciled in countries outside Germany, (b) do not have a place of business in Germany and (c) operate in the country only on a temporary basis, the notification requirement addresses the special challenges faced by the customs administration’s unit responsible for the financial control of undeclared work.

The aim is to allow the customs administration to check compliance with minimum working standards in the case of cross-border postings of workers to Germany. The notifications provide the customs administration with timely information on work and services performed on German territory. A further aim is to obtain assurances from employers and temporary employment agencies outside Germany that they will comply with Germany’s minimum working standards as laid down in the Minimum Wage Act, the Posted Workers Act and the Temporary Employment Act.

Details of the notification requirement

Under the Minimum Wage Act and the Posted Workers Act, employers domiciled in countries outside Germany are required to notify the Central Customs Authority of any workers posted to Germany who are employed in one of the following industries:

  • Waste management, including street cleaning and winter road maintenance
  • Setting up and dismantling at trade fairs and exhibitions
  • Educational and training services as defined in Books II and III of the Social Code
  • Construction and construction-related industries
  • Electrical trade
  • Meat industry
  • Catering and hotel business
  • Industrial cleaning
  • Agriculture, forestry and horticulture
  • Passenger transport
  • Care provision
  • Fairground and amusement sector
  • Haulage, transport and associated logistics industry
  • Textiles and clothing industry
  • Laundry services for commercial clients
    (as of December 2016)

Modified notification requirement

The Minimum Wage Reporting Ordinance sets out the conditions under which employers outside Germany and users of temporary workers are required to submit an operational schedule instead of a notification. This modified notification requirement adapts the rules to industry-specific circumstances without jeopardising the customs administration’s ability to conduct effective minimum wage checks (which are carried out by the unit responsible for the financial control of undeclared work).

In derogation of regular notification rules, employers domiciled outside Germany and users of temporary workers can submit an operational schedule if workers are deployed as follows:

1. At a single place of employment

a) before 6am or after 10pm, at least in part
b) in shift work

2. At several places of employment on the same day
3. Exclusively for mobile activities

In the case of changing places of employment and shift work, it is sufficient for employers to submit an operational schedule for a period of up to three months instead of having to file individual notifications. Notifications of changes to such operational schedules are necessary only if deployment is rescheduled by at least eight hours.

In the case of exclusively mobile activities, operational schedules can cover periods of up to six months, depending on order book predictability. Notifications of changes are not required. If the relevant documents are kept outside Germany, the operational schedule must be accompanied by a declaration confirming that the documents will be made available in the German language upon request by the customs administration. This is to ensure that compliance with mandatory working conditions can be monitored.

Exemption from the notification requirement

Notifications under the Minimum Wage Act are not required for (a) employees with regular monthly gross pay in excess of €2,958 or (b) employees with regular monthly gross pay in excess of €2,000 provided that the employer can submit evidence of such payment for the past full twelve months (not counting any periods without entitlement to pay).

Notifications under the Minimum Wage Act and the Posted Workers Act may also be waived for an employer’s spouse, registered life partner, children or parents who work in that employer’s business. Employers who are legal persons or partnerships with legal capacity are exempt from the notification requirement if a corresponding family relationship exists with the entity (or a member of the entity) authorised to represent the legal person, or with a partner authorised to represent the partnership.

German-language documents substantiating eligibility for the exemption must be kept available in Germany.

The new electronic notification procedure

To simplify workflows for persons/firms required to submit notifications and for the customs administration, the current fax-based system is being replaced by an electronic notification procedure. The Minimum Wage Reporting Ordinance was amended to create a legal basis for this change.

Under the Ordinance Amending the Minimum Wage Reporting Ordinance, which enters into force on 1 January 2017, those subject to the notification requirement must submit their notifications electronically via the registration website provided by the customs administration. The substantive content of the notification requirement will remain unchanged. The Ordinance does not introduce any new information requirements for the private sector.

The Ordinance contains two stipulations: First, it defines what form electronic transmissions should take. Employers domiciled outside Germany and users of temporary workers are required to submit notifications online. Second, the Ordinance sets out the technical and organisational requirements for electronic transmission. This ensures compliance with data protection rules. The online portal to be used for the submission of notifications guarantees that the data are secure. The system gives notifications a unique identifier, and end-to-end encryption is obligatory when using generally accessible networks. This ensures confidentiality and data integrity during transmission.

There will be a six-month transitional period until 30 June 2017 to allow employers and users of temporary workers to convert to the electronic notification procedure. Until the end of the transitional period, employers and users of temporary workers can continue to submit the old notification forms to the customs administration. The parallel use of the old and the new system for a limited period of time will make it possible to address any practical issues that may arise without affecting the ongoing notification process. It will also allow the customs administration to continue to raise awareness of the transition, particularly among employers outside Germany who will be affected by the change. After the transitional period ends, the customs administration will stop providing or updating the old notification form. The fax server will no longer be operated.

Starting on 1 January 2017, employers domiciled outside Germany are encouraged to use the minimum wage registration website to submit online notifications for workers posted to Germany. The same applies to businesses that use workers supplied by an agency domiciled outside Germany.

The aim is to modernise and streamline the notification procedure. This will make it significantly easier to monitor compliance with minimum wage rules and give employers domiciled outside Germany as well as users of temporary workers easier access to the procedure. In addition, the online procedure cuts unnecessary red tape for both companies and customs administration authorities. Form-based data entry and the electronic provision of data also help make the new procedure more user-friendly. Thanks to the electronic format, the customs administration can process and forward notifications automatically. Manual data entry is no longer necessary. By allowing notifications to be submitted online, the German Finance Ministry is following one of industry’s central requests for a modern and efficient notification procedure.

As of 1 January 2017, the minimum wage registration website can be accessed directly at www.meldeportal-mindestlohn.de or via the German Customs website www.zoll.de (the relevant link can be found under “Services and databases”).

The online forms are intuitively designed and follow the usual layout requirements of the customs administration’s website. The user interface and online forms are available in German, English and French.

Before submitting a notification, users must create an account with a personal password. This protects their data from unauthorised access. On the registration website, employers and users of temporary labour can access the following online forms (which are the same as the previously available printed forms):

  • Notification – Employer
  • Operational schedule – Employer (stationary activity)
  • Operational schedule – Employer (mobile activity)
  • Notification – User of temporary labour
  • Operational schedule – User of temporary labour (stationary activity)
  • Operational schedule – User of temporary labour (mobile activity)

The forms can be filled out quickly thanks to easy-to-use navigation menus. Users can save their work at any time and resume filling out the forms later. They can also re-access and filter notifications after the notifications have been sent. Users can also save completed forms to their accounts and use them as templates for future notifications. In the case of temporary workers supplied by an agency, forms for the supplier’s assurance declaration are available. Suppliers can download this form without having to set up their own user account.

Summary

The new online registration system will be launched on 1 January 2017 and will considerably simplify the procedure for businesses that are required to submit notifications. Thanks to the user-friendly online portal, notifications can be filled out and submitted much more quickly and easily, and there are no longer any postage or fax costs.

In this way, the German customs administration is providing economic operators with an up-to-date and secure tool for submitting their notifications.

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