relocating to germany webinar presentation

RELOC ATING TO GERMANY

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Andrew McNeilis

Chief Operating Officer

” Why relocate to Germany?

” Employment Law in Germany

” Visas & Immigration

” Housing in Germany (Buying & Renting)

” Integrating into Germany

” The Moving Process

” Q&A

Andrew McNeilis


Phaidon International, London

Dr. Steffen Görres

Bryan Cave,

International Law Firm, Hamburg

Beate Thierauf

Swift

Relocation Services, Munich

Ingrid Henke

ARRIVA

Relocation Services, Berlin

Katalin Geis

KaleidosGlobe

Relocation Services, Hamburg

Alistair Hunt

AGS Worldwide Movers

International Co-ordination and

Logistics

Micro-Specialist Recruitment Group of 8 Specialist Recruitment Brands

WHY RELOC ATE TO GERMANY?

• Recent survey conducted concluded a very high appetite for relocation

across a number of industries - 60-95% of respondents were likely or actively

looking to relocate depending on their market

• Relocation can leverage your career ” our recent survey of over 2000

professionals found Career Progression to be the main driver for relocation

• Germany is Europe's largest economy (Reuters)

• The German economy is growing

• 1.8% expected GDP growth in 2014 and 2% expected growth in 2015 ” this

is more than 4 times faster than in 2013 as a whole (German Economy

Ministry)

• Employment is on the rise

-The German Economy Ministry forecast a record number of 42.1 million

people in employment this year, up 240,000 from the levels reached in 2013

• There is increasingly a shortage of skilled workers in Germany

- Particularly in the fields of IT, Sciences, Mathematics and Engineering

• Great workers rights and employment protection

EMPLOYMENT LAW

Employment Law

Dr. Steffen Goerres

Specialised Attorney for Labour Law,

Hamburg

+49 40 30 33 16 128

[email protected]

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• Significant Pro-Employee Protections

• No ‚at will‛ employment

• System focused on protecting employment relationship rather than providing damage

• Legal situation very much influenced by court decisions although there is a statutory

law system in Germany

• Written references from prior employers are important

• Background checks restricted, usually to extent of employee’s consent

• Avoiding discrimination during hiring process is important

• No statutory minimum wage ” will be implemented within the next years as project

of the new German government

• Minimum wage system based on tariff agreement where such agreements apply.

• Christmas bonus very common

• Contributions to health insurance, nursing insurance, state pension insurance and

unemployment insurance is mandatory

• Contributions to mandatory social security insurances jointly funded by employer and

employee. Employer‘s contributions are in addition to gross salary

• May or may not be put in writing; oral or implied conclusion possible; offer letters not

common and not advisable

• Written statement of conditions of employment to be provided by employer no later

than one month from start of employment

• Fixed-term-contract:

• Without any special reason conclusion of contract permissible for up to 2 years; if no previous

employment contract with employer apparent. May be renewed thrice, if 2-year period is not

exceeded in total

• With an objective reason contractual limitations and time limits are not bound by the 2-year period

(e.g. special requirements for additional staff in seasonal businesses as an objective reasonable need

for fixed-term employment)

• Common for managing directors with a timeframe of 3 or 5 years

• Part-time contract:

• Very common

• Entitlement to reduction of contractual working time in firms with more than 15 regular employees

• Complex statutory differentiation between working time, resting time, on-call duty,

working breaks, times of travel etc

• Maximum daily working time: 8 hours.

• Extension to 10 hours possible; average working time within 24 weeks may not

exceed 8 hours daily

• Minimum ‚resting period‛, (continued period without working, between the end of a

working day and the start of a new working day): 11 hours

• Right to a 30-minutes-break for a 6-9 hours workday; 45 minutes minimum break for

workday exceeding 9 hours

• Statutory minimum holiday entitlement: 20 working days based on a 5 day working

week (respectively 24 days for a 6-day-working week)

• Most usual to grant more holidays in Germany; commonly between 25 and 30 days.

• During the holidays the contractual salary to be paid continuously

• Registered disabled persons have an additional entitlement of 5 days

• State-to-State variation of public holidays as additional entitlement to the normal

holiday entitlement ” between 8 to 15 public holidays depending on the place of work

• Employer’s obligation to continuous full payment of contractual salary from first day of

illness to a maximum of six weeks in case employment relationship existed for

minimum of four weeks

• Employee entitlement to receive (reduced) payment from health insurance after six

week period

• Maternity leave: 14 weeks in total (6 weeks before expected date of birth and 8

weeks after the birth)

• Full remuneration entitlement of employee

• Parental leave: up to child’s 3rd

birthday, very common for mothers rather than fathers

• Possibility of carrying forward a leave of up to 12 months of the 3 years total until

child is 8 years old with consent of employer

• Generally unpaid but system of state benefits

• General right to work for employee

• Garden leave only based on prior agreement - even after serving notice

• In practice, use of garden leave common after serving notice for high ranking

employees

• Payment in lieu is not permitted unless employee agrees

“ Key concept: Personal data belongs to an individual employee

“ Objective business need for use/transfer of data always required

“ Free consent of individual not accepted as valid (because employees are deemed not

to have free will)

“ Use and Transfer of Data outside the EU: Recipient with ‚safe-harbour‛ certification

and contracting under EU data protection regime and clearance by EU

“ HR processes to be as privacy-conscious as possible

• Based on the General Equal Treatment Act, prohibited by German law in the form of

direct and indirect discrimination

• Further protection against harassment, instructions to discriminate as well as victimization

on grounds of race, ethnic origin, religion, belief, age and sexual identity

• Most legal issues concerning Hiring (e.g. discriminatory job advertisement or selection

process).

• Due to sufficient pro-employee regulations only little litigative role

• No recognition of punitive damages in German Employment Law

• Traditionally little compensation for immaterial damages awarded by courts

• Termination by agreement

• Termination by serving notice, in writing (original signature required), employer’s ability

to prove delivery

• Different applicable notice periods with regard to duration of the employment ”

variation from one to seven months to the end of the calendar month after 20 years

of employment

• Termination without notice: important reasons i.e. gross misconduct allowing

termination with immediate effect

• Size threshold (more than 10 employees)

• Qualifying period (more than 6 months of service)

• Personal scope (employee ” not applicable on managing director)

• Justified reasons:

• Person ” occurrence regularly in form of dismissals due to illness. Negative prognosis

to be pre-estimated which does not allow for an amelioration of the situation

• Conduct ” occurrence regularly in case of infringements or in the range of

performance and require the pronouncement of at least one preceding warning for

comparable misbehavior

• Business/Redundancy ” Requirement of employer decision leading to at least one job-

cut

• Compliance with very strict framework conditions in order to be valid and binding:

“ Written form (sec. 74 para. 1 HGB)

“ Justification by a legitimate interest of the employer with regard to the

temporal, geographical and factual scope a post contractual non-compete

agreement

“ The simple desire to prohibit an employee from competing with the

employer for a certain period after the end of the employment contract as

such not sufficient

“ Restricted period of up to two years permissible (sec. 74 a para. 1 HGB)

“ Compensation: Obligation by the employer to pay compensation for the

duration of the restrictive covenant in the agreement (at least 50% of the last

contractual remuneration and benefits

Note: Incorrect clauses can be either unenforceable for the employer or even null and void!

• Trade unions = Industry associations of employees; conclusion of collective

agreements

• Guaranteed Right to strike for employees

• Conclusion of collective bargaining agreements as associations of employees

• E.g. regulation of remuneration for different groups of employees, claims for

vacation exceeding the statutory provisions etc

• Works Council = formal staff representative body in the employer‘s business units;

• Representation of employees vis-à-vis employer on the level of establishment

• Preconditions for implementation: 5 employees of the age of 18 + and eligible

to vote and 3 employees eligible as candidates (age of 18 + and 6 months +

length of service)

• Elections at 4 years intervals, not compulsory meaning that it only takes place

if the employees arranges for it

Co-determination

Consultation

Information

1. Respect cultural differences

2. Always acclimatize yourself to local law and practice

3. Avoid dangerous assumptions, such as:

” ‚Europe is one place‛

” ‚Californian law applies there‛

4. Every employee starts with an employment contract, either written (preferred) or

implied by labor court

5. Employment-at-will does not exist

VISAS & IMMIGRATION

Visas and Immigration

Beate Thierauf

Swift Relocation Services,

Munich

+49 (0)89 665 999 71

[email protected]

• All foreigners who are staying longer than 90 days in Germany and want to work or

study do need a visa if they do not belong to EU countries

” (Belgium, Bulgaria, Denmark, Estonia, Finnland, France, Greece, Great Britain,

Ireland, Iceland, Italy, Croatia, Latvia, Lithuania, Liechtenstein, Luxemburg, Malta,

Netherlands, Norway, Austria, Poland, Portugal, Rumania, Sweden, Slovakia,

Switzerland, Slowenia, Spain, Czech Republic, Hungary und Cyprus)

• There are certain NON-EU countries that are also exempted from an entry visa that

includes Australia, Israel, Japan, Canada, New Zealand, South Corea and USA

• Schengen Visa ” tourist visa

• Business Visa ” only applicable to participate in meetings

• Student visa ” if you want to study in Germany

• Work Visa - to take up work in Germany.

” The visa application has to be handed in at a German embassy in the country of

residence. If it is the first application the embassy will decide directly or involve the labor

office in the according city. Duration of the process is between 4 weeks ” 3 months

• Documents to be provided:

” Needs to be checked on the website of the German embassy in country of residence.

Sometimes they differ slightly in their requirements.

” Application forms filled in

” Biometric passport photos

” University degrees

” Marriage certificates

” Birth certificates of children

” Passports

” Employment contract with job description and updated cv/resume

• The application for a work visa is €60,00 per person

• For children under 18 it is €30,00

• All foreigners from NON-EU countries do need a work and/or residence permit

• The visa is usually issued for an initial period of three months and it needs to be extended in

Germany after arrival

• Blue Card § 19a” is possible for people holding a university degree from a German university or

from a foreign university recognized from the German government together with a work

contract. The minimum annual salary is €47.600

• If you do not hold a university degree but execute a job that is related to shortage occupation

for example, IT, Mechatronics, Electronics, Robotics etc. your annual salary has to exceed

€37.128

• If you are not a Blue Card candidate the application will be checked by the labor office and a

good explanation from the employer needs to be issued why that candidate is the preferred

choice and no German was found. This usually takes 1-4 weeks

• The fee for the application is €110,00 per permit

• Same requirements as for the visa process, only that the foreign office handles the

application directly

• Passport copy, employment contract, university degree, application form for

employment needs to be handed in and they decide within 1-4 weeks

• If they need to apply for a visa all above mentioned docs have to be handed to the

embassy

• If it is without visa a marriage certificate and birth certificate of the children needs to

be presented.

• Fees for the permit are €110,00 for adults and €60,00 for children.

HOUSING

Housing

Ingrid Henke

ARRIVA


+49-(0)30-32774311

[email protected]

1. Adverts in the classified section of newspapers ( usually in the weeekend

editions)

2. Real Estate Websites:

• Immobilienscout24.de

• Immonet.de

• Immowelt.de

• Immobilien.de

3. Real Estate Agencies (Makler/ Immobilenmakler)

Private companies/agents who offer properties to rent or to buy. On behalf of the landlord or seller.

They often don´t speak English.

Once a contract is made a commission/brokerage fee is due.

If the are members of a professional association like IVD- Immobilienverband Deutschland or RDM ” Ring

Deutscher Makler this might be an indication for professionalism.

Commission/brokerage fee*

For residential properties up to 2 months´ rent plus 19% VAT and for commercial properties up to 3

months´rent plus 19 % VAT are due at exchange of contract by tenant.

For properties to buy up to 6 % of the asking price plus VAT are due from the buyer

*In 2014 there might be changes asking the landlord or seller to pay the comission.

Sometimes the same property is offered by several real estate agencies. Be aware that you don´t get

involved in obligations to several ones. Stick to one agency and inform the other one that you already have

knowledge about the property they offer.

4. Relocation Services

• Create a needs profile, inform about neigborhoods, search for and preselect suitable locations,

coordinate appointments, accompany on house visits and organize and check the rental contract

• The relocation agencies charge an agreed fee for their services

In Germany most apartments are rented unfurnished, sometimes even without a fitted kitchen as well as without fitted

wardrobes often even without light fittings.

Unfurnished:

In these cases the rents are commonly known as ‚Kaltmiete ‚ ” ‚cold‚ basic rent without additional charges

‚ Nettokaltmiete‚ ” does not include additional costs like heating, water, garbage removal.

‚ Bruttokaltmiete‚ does not include heating costs, but additonal costs like water, garbage removal

‚ Warmmiete‚ ” basic rent, heating, water garbage removal - all additional costs included

But be aware that electricity for the apartment, telephone, internet is not included in the rent

After signing the rental agreement a deposit of at the most 3 monthly basic rents has to be paid

The rent for furnished apartments includes usually all the additional costs, as well as furniture supplement, internet use and

electricity.

If you buy a property you have to add additional costs of approximately 14 % to the sale price of the property. That includes real

estate agent´s provision, notary and tax „Grunderwerbssteuer‚ ” up to 6 % of the sale price

Tenants are very protected in Germany. It can be very difficult to cancel a rental agreement, if there are problems or the rent is not

paid. Therefore before signing a rental lease the landlord wants to make sure that the tenant is able to pay the rent. He will ask for the

following information:

• ID ”copy of passport

• Self certificate

• Schufa-Auskunft for Germany, or similar credit rating certificate.

• Proof of income, e.g. salary slips, letter or work contract from the employer -stating salary and duration of employment

• ‚ Mietschuldenfreiheitsbescheinigung‚ - A letter from the previous landlord stating that the rent was paid regularly

Most rental contracts in Germany are for an unlimited duration with 3 months notice for the tenant, The landlord usually can only

cancel the rental agreement in the following circumstances: the apartment will be used by him or a family member.

Or there are rental leases of limited period (Zeitmietvertrag) because the owner or a family member is planning to move in by himself

or because substantial refurbishment is planned.

Sometimes a minimum rental period of 1 or 2 years is agreed.

On hand over of the property to the tenant a written statement „Übergabeprotokoll‚ will be filled in, stating the condition of the

rented accomodation.

The cost of a property to rent varies by reagion and city

Usually rent and purchase prices are cheaper in rural areas

In the last years real estate prices went up in Germany

Very expensive cities are Munich, Frankfurt/Main, Stuttgart, Hamburg but Berlin prices are still quite

reasonable.

For example in Berlin the average cold rent per sqm* in a good location with reasonable good

standard is between 9 to 13 Euros plus additional costs around 2 to 4 € per sqm.

1 sqm is about 10.8 sqft

As an orientation an overview of average rents - ‚ Mietspiegel‚ - is available for most cities. But

don´t be surprised if the rent you are asked for is higher, as prices go up.

INTEGRATING INTO GERMANY

Integrating into Germany

Katalin Geis

KaleidosGlobe


+49-40-38 61 07 85

[email protected]

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A period of orientation and settling-in follows when the client has moved into the house or

apartment. Depending on the specific needs and requirements, on one or two days this program

provides information, consultation and assistance on topics like:

• Opening a bank account

• Shopping facilities

• Language training

• Public transport

• Social security system including statutory health

insurance

• Private insurances, such as health insurance, car

insurance , household- and liability insurance,

• Bilingual doctors and dentists

• Hospitals and emergency ambulance

• Information on churches and other religious

communities

• Embassies and Consulates

• Craftsmen / Handymen

• Babysitter, Au-Pair, Kindergarten

• German and international schools

• Vets, kennels

• Clubs and organizations for expatriates

• Cultural offerings

• Leisure and sports activities

• Emergency phone numbers

• Telephone and Internet

• TV and public television/radio tax

• Welcome-to-Germany Seminars

• Living and Working in Germany

• Cultural Awareness Seminars

• Intercultural Trainings for children

• Spouse Career Trainings

• Child benefit

• Kindergarten and Preschool in Germany

• German and International School System

• Juveniles and Vocational Training

• Leisure & Social Programs

• Music & Sport

• Learning Disabilities

• Protection of Minors

THE MOVING PROCESS

The Moving Process

Alistair Hunt


+44 1895 201595

[email protected]

• 40 years experience

• 128 worldwide locations in 80 countries

• Family owned

• Door-to-door service

• 55,000 moves in 2013

• Preferred supplier for the German Ministry of Foreign Affairs

• Financially sound with turnover of $377m

• Your request

• Free pre-move survey

• Dedicated move co-ordinator

• Move day

• Transportation

• Delivery

• Prepare your home for sale

• Ensure visas are in place before moving

• Don’t leave appointing a removal company to the last minute

• Prepare for the packing day

• Arrange temporary accommodation before moving

• Research exchange rates

• Use your contacts to find a job for your spouse

• Keep the school year in mind

• Research destination for you and your family

• Investigate living costs

Methods of moving:

• Airfreight

• Sea freight - (FCL) Full Container Load, 20ft or 40ft

• Sea freight - (LCL) Less than Container Load

• Sea freight - Groupage

• Road freight

• Road freight CE

Vehicle shipping:

• Containerised Shipping

• Roll on roll off (RORO)

• Road freight

Storage:

• 2 Logistic hubs in Berlin and Koblenz

• Container store facilities in every major German city

• Specialist humidity controlled Fine Art storage

• Non-perishable items

Insurance:

• Full Replacement Marine Insurance Policy ” Underwritten by AXA

Our Clients

Andrew McNeilis



Dr. Steffen Görres

Bryan Cave,


Beate Thierauf

Swift


Ingrid Henke

ARRIVA


Katalin Geis

KaleidosGlobe


Alistair Hunt



Logistics

TO CONCLUDE

Following the webinar we will be releasing :

• ‚Relocating to Germany‛ webinar recording

• ‚Relocating to Germany‛ report

• ‚Relocating to Germany‛ podcast

Andrew McNeilis



[email protected]

Dr. Steffen Görres

Bryan Cave,


[email protected]

Beate Thierauf

Swift


[email protected]

Ingrid Henke

ARRIVA


[email protected]

Katalin Geis

KaleidosGlobe


[email protected]

Alistair Hunt



Logistics

[email protected]

mailto:[email protected]











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