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Hi Necia,

In the case you describe seems you have a contract from a german company so in this case German labor law is applied.

Hi and welcome to the Forum.

My opinion (I'm not an expert in German things) is if you are living and working in Berlin, your contact will fall under German Law; who and where your employer is would be irrelevant.

I'm going to ask if this thread can be moved to our German Forum where somebody there may know more than my opinion.

I hope this helps.

Cynic

Expat Team

I am also a legal layman, but with some basic understanding of the situation in Germany. But please cross-check everything I say with an expert!

In Germany, we have freedom of contract, meaning the contractual parties are free to agree on any regulation they like. It is thus o.k. to choose, in an employment contract, any foreign labour law - and this is also valid. (If your contract does not specify the chosen nationallaw, it needs to be interpreted by an expert as to what was most likely the intended law.)

However, at the same time you (but not the foreign employer!) also have to fulfill German law, which might contradict your employment contract - and in those cases has higher priority.

For example, you have to abide by German legal rules (including occupational safety, work hours, etc.). But unlike a local one, the foreign employer will not check this and discourage you from breaking the law - the full responsibility is yours!

Also, since the foreign employer will not follow statutory rules like contributing half of the (compulsory) health and social insurance premiums, you will have to pay it in full from your pocket. In practice, you will be formally treated as self-employed, which entails a long list of registration, accountancy and taxation requirements (Germany is not short of buerocracy!).

Last not least, your income will be taxable in Germany - and the tax authority will (probably from the second year onwards) ask you to pre-pay estimated monthly contributions to them, just as a German employer would. With an EU employer, I guess, double taxation can probably be avoided - but ask about that on the employer's country forum or (better) the authorities there.

For the formal details of all this, by all means ask a lawyer, tax consultant and/or accountant - whose help you will anyway need to manoeuvre it, if you are less than fluent in (legalese) German.

In my opinion, it is not to your favour (and thus should be avoided!) to have a contract under foreign labour law when working in Germany!

One more comment: In case of a legal conflict with the employer, where would you sue them? In a German or Dutch court? Both are inconvenient for either party - and the court would struggle to make any decision under this tangle of national rules. Basically, by agreeing to such a constellation, you forfeit your possibility to seek legal redress.

I myself had a case where a German company employed me in another country and I did something which they thought broke German, but not local law. They fired me under German law and I sued against it in a German court. The judge basically said that solving this would take many years, involve opinions of international legal experts and require much more in legal fees than the amount of salary in question. She thus very heavily encouraged us to settle out of court, which we eventually did (at conditions both sides were unhappy with).

Not something I ever want to go through again!

@Henk Jan Jansen Hi! Even if my employer does not have an entity in Germany?

@Henk Jan Jansen Hi! Even if my employer does not have an entity in Germany?
-@Necia

Read my reply to understand the situation - it's not a Yes/No question, but more complicated!