Non-payment of wage

Non-payment of wage

Example case

Dimitros was happy when he found work for a subcontractor of a large logistics company through an Internet advert. His works as a courier and parcel deliverer in Berlin. He has been working for two months and he is now not so happy. Dimitros has not received any wage and has no more money to live on. He already asked his boss a few times about it. At first he was told that there had been an accounting error and that his money had accidentally been transferred to another colleague. Then the boss told him that he was also waiting for his money from the client himself. He could only pay Dimitros if he got paid himself. Recently, the boss no longer answers the phone when Dimitros calls him. Dimitrios does not know what to do in this situation and which institution he can ask for help.

1. Job centre/Federal Employment Agency (Bundesagentur für Arbeit)

Dimitros has no money and obtaining his rights can take some time. He should therefore immediately apply for Unemployment benefit I (Arbeitslosengeld I) at the local Employment agency or Unemployment benefit II (Arbeitslosengeld II) at the local Job centre.

Unemployment benefit I (Arbeitslosengeld I)

  • Even if the employment relationship still exists, but the employer does not pay the salary due, Dimitros can apply for Unemployment benefit I (Arbeitslosengeld I). . In this case, the unemployment benefit is an advance payment towards the employer’s payment obligation. This is regulated in § 157 para. 3 Social Security Code (SGB) III and is called “Gleichwohlgewährung (Nonetheless grant)”.
  • If Dimitros does not meet the requirements for Unemployment benefit I (Arbeitslosengeld I), he can apply for Unemployment benefit II (Arbeitslosengeld II) at the Job centre.

Unemployment benefit II (Arbeitslosengeld II)

Dimitros can submit the application in writing or verbally. The Job centre must give him the required application forms. Dimitros has a legal right to have his application accepted and examined. After the examination, the authority must give him a written notification stating the reasons. Dimitros should expressly request that.

If Dimitros meets the requirements for Unemployment benefit II (Arbeitslosengeld II), he can also apply for an advance payment because of his difficult financial situation. This is advisable because it often takes several weeks to process the application.

Dimitros can find the addresses of the responsible local authorities online:

https://www.arbeitsagentur.de/en/consultation-and-job-placement

2. Health insurance

Dimitros should inquire at his health insurance company whether the employer has reported him to the social security and paid contributions there.

When employers fail to pay wages, they often fail to pay social cover contributions too. This creates gaps in health insurance. In order to verify that, Dimitros has to contact his health insurance company.

If the employer has not registered Dimitros for social security, Dimitros should submit his employment contract and other work documents to the health insurance company in order to prove his employment relationship. The health insurance company is a collection point, i.e. it has to close the gap in social cover and demand social cover contributions from the employer.

3. Employer

Even if Dimitros has already verbally requested his claims from his employer, he should also contact the employer in writing and request his wage (request for payment). Sometimes the employment contract even states that pending wages must be requested in writing. Dimitros should set his employer a deadline for payment. He can write the letter himself or with the help of an Advice centre.

In the letter, Dimitros can declare a so-called “Reservation of performance“. This means that he refuses to work as long as he does not get his wage. He has the right to do so after two months of work without wage.

4. Advice centre

Dimitros receives information about his rights at the Advice centre. The counsellors can help him to write a written request for payment or they can contact his employer directly to clarify the case.

Specific employment law Advice centres:

https://bema.berlin/en/

https://www.arbeitundleben.de/arbeitsfelder/beratungsnetzwerk

https://www.faire-mobilitaet.de/en

Dimitros can find a Germany-wide overview of all Advice centres according to the subject focus and language at:

https://www.eu-gleichbehandlungsstelle.de/eugs-en/eu-citizens/searching-for-an-advice-centre

If the employer still does not pay the wage, Dimitros has to take legal action against him in the Labour court can legally claim the wage for him. There is no authority in Germany that can do this for the claiming of the wages. Dimitros has to take legal action himself.

5. Labour court

Without a lawyer

Dimitrios does not necessarily need a lawyer in the Labour court, he can also represent himself. The procedure is carried out in the Labour court at the place where Dimitros worked or where the employer’s company is based. Dimitrios can decide this himself.

The official language in the court is German, so the officials cannot for example speak English with Dimitros. If Dimitros does not speak German well, he should be accompanied by someone who will help him to communicate (“linguistic assistance”). It does not have to be an official interpreter. A friend who speaks good German can help Dimitros.

 In every Labour court in Germany there is a Legal application office where you can show all documents (employment contract, list of hours, identity card) and explain your claim verbally. The legal action is written down for Dimitros. It does not cost any money. However, the Legal application office is not allowed to advise Dimitros on legal issues.

Dimitros can also fill out the claim form and send it to the Labour court by post or fax. The complaint forms can be found on the websites of many Labour courts:

Dimitros can find an example of such a complaint form under Annex IV PDF, 245 KB, not barrier-free

After he has filed the legal action, Dimitros receives a written letter asking him to go to a conciliation meeting . The purpose of this appointment is to find out if Dimitros and his employer can come to an agreement. Dimitros can request the presence of an interpreter, but he has to pay for it himself. Usually the procedure before the Labour court ends with an agreement at this first appointment. In such a case, Dimitros would not have to pay any costs (apart from the interpreting costs).

If things have to be done quickly, Dimitros can claim his wage in court in urgent proceedings. However, he must then demonstrate that he is absolutely dependent on the wage.

If the case is not complicated, as with Dimitros, he can alternatively make his claim in a legal dunning procedure.

Caution! The form for the Labour court dunning procedure should not be confused with the form for the Civil court dunning procedure . The form “Dunning notice” can be ordered online or bought in shops selling office supplies. It costs around € 3 - 5 and is very easy to fill out.

Dimitros can find the Dunning notice form of the Labour court under Annex V PDF, 237 KB, not barrier-free

Dimitrios must submit the completed form to the responsible Labour court.

If the employer does not object to the dunning notice, the court sends Dimitros the enforcement order by which it orders the payment of his wage.

With a lawyer

If Dimitros does not want to go to the Labour court alone, he can be represented by a lawyer. Dimitros can find a lawyer, for example, through the embassy or through a recommendation from his circle of friends. There are also search options on the website of the Bar Association, which can be used to find lawyers with different language skills and specialisations.

An example is the search engine of the German Lawyers’ Association:

https://anwaltauskunft.de/magazin

An Advice centre can also help in the search for a lawyer.

However, he has to pay the costs for the lawyer himself. Dimitros will not be reimbursed for the costs even if he wins the case.

Since Dimitros has no money for a lawyer, the latter can apply for these costs to be paid for by the State (“Legal aid”). Certain requirements must be met for this: The legal action must have a chance of success and Dimitros must prove that he cannot pay for the legal costs himself. In addition, Dimitros is obliged, for a period of four years after the end of the legal proceedings, to notify the court immediately and without being asked if his financial situation has improved. If his financial situation improves noticeably during this period, the court will order that Dimitros must repay the costs! The application for legal aid is made using a form that can be obtained from the court or found online:

Dimitros can find the form for legal aid in the under Annex VI PDF, 1 MB, not barrier-free

The application for legal aid must be completed and submitted in German. The translation of the application and instructions for completing it in several languages can be found on the website of the Federal Justice Office:

https://justiz.de/service/formular/f_allgemeines/index.php

Dimitros submits the application for legal aid to the Labour court. If the application is approved, the costs for the lawyer and the court costs will be covered.

If Dimitros is a member of a trade union, a union lawyer can represent him in court free of charge.

6. Registration office/Commercial register

If the Labour court writes that the employer has moved to an unknown place, Dimitros must inform the court of the employer’s new address. He can contact the registration authority or the commercial register to find out the new address.

At the Registration office you can get the registration information if you state that you have filed legal action against the employer (in form: “Intended use: Judicial enforcement of wage claims”).

Dimitros can find the form for the application for a simple registration information at the registration office under Annex VII PDF, 259 KB, not barrier-free

If the company is recorded in the commercial register, Dimitros can determine the address via the commercial register. The commercial register is run by the District court, the request for information can also be submitted online:

https://www.online-handelsregister. de/?gclid=CjwKCAjw_JuGBhBkEiwA1xmbRS s6P8JJvTwclctetcgQHJsevhH0DqcET5E 3Q48IJz0PC0maPUcXLhoCGq0QAvD_BwE

Dimitros can find the form for the application for a simple registration information at the commercial register under Annex VIII PDF, 163 KB, not barrier-free

If Dimitros does not receive any information in this way, he can apply to the Labour court to have the complaint delivered by being publicly displayed in the court.

Dimitros can find the form for the application for public delivery if the address of the person is unknown under Annex IX PDF, 232 KB, not barrier-free

7. District court

If the employer does not pay voluntarily after a judgment or settlement by the court, Dimitros can turn to a bailiff to initiate a compulsory enforcement procedure. The bailiff is assigned by the District court where the employer has his place of residence/his place of business.

Dimitros can find the address of the responsible District court online:

https://www.gerichtsverzeichnis.de/

8. Federal Employment Agency (Bundesagentur für Arbeit)

Sometimes the employer closes the company and moves. Sometimes the bailiff finds that the employer has already made an affidavit and has long ceased operations. Or you find out that the company has filed for bankruptcy. Then the bailiff cannot collect the money either.

In all these cases, Dimitros’ wage is secured for a maximum of three months by the so-called Insolvency benefits. For this he has to submit an application to the Federal Employment Agency within two months after the company has filed for insolvency where the employer has his registered address.

The application for the Insolvency benefits can be found online:

https://www.arbeitsagentur.de/datei/ AntragInsolvenzgeld_ba013115.pdf

Dimitros can find the form for applying for Insolvency benefits under Annex X PDF, 1 MB, not barrier-free

9. Financial control of illegal employment (FKS)

If the employer does not pay the wage, he violates the minimum wage law and can thereby make himself punishable. Therefore Dimitros can file a claim with the local Financial control of illegal employment (FKS). The Financial control of illegal employment is an authority that controls employers and, among other things, checks whether they are paying the minimum wage and correctly paying the social security contributions for the workers. The FKS in the region in which his employer is registered is responsible for examining Dimitros’ case.

Dimitros can find the address of the responsible FKS on the following website:

https://www.zoll.de/EN/Contact/Enquiries/General-enquiries/general-enquiries_node.html

Dimitros can contact the FKS personally, file a complaint and make a statement. If that is not possible, he can also submit a message online:

https://www.zoll.de/EN/Contact/Enquiries/enquiries_node.html

The claim of Dimitros can lead to the Financial control of illegal employment (FKS) checking and determining the situation. This does not help Dimitros to get his wages, but the employer can then be punished. The employer can then be punished with a fine or even imprisonment for tax and social security fraud. The Financial control of illegal employment (FKS) needs as much information as possible for the efficient review and processing of the case. Therefore, Dimitros should provide information about the duration of the employment relationship, the daily working hours, the amounts received, witnesses, etc.

In principle, Dimotros should not suffer any disadvantages from the fact that his employer has not paid the social security contributions. The gaps in all branches of social insurance (pension, health, long-term care, unemployment and accident insurance) must be closed by the respective insurance company after the events become known. The insurance cover remains in full.