Employers should act now to ensure all employees — including contractors’ employees — receive adequate pay to avoid risk of significant fines.

21 of the 28 member states of the European Union have minimum wage laws. On 1 January 2015, Germany will become number 22. For the first time in its history, Germany will introduce a nationwide minimum wage — set at Euro 8.50 gross per hour. Failure to comply with the Minimum Wage Act can have serious consequences for employers: the government can impose fines of up to half a million Euro.

Scope of the Minimum Wage Act -

The Minimum Wage Act (the Act) applies to all employees and across all industry sectors. There are, however, exceptions for some categories of workers: trainees, volunteers, the long-term unemployed as well as children and adolescents who have not completed professional training. Interns can be exempt if their internship meets certain specified requirements. There are transitional rules, which will delay the full implementation of the new minimum wage regulations in certain industry sectors until 31 December 2017.