There is a legal minimum wage in Germany, you should have certainly noticed it. With the new law, everyone in Germany will receive a remuneration of approximately $10 per hour for his work. Trainees, in other countries including USA and UK, also fall under the legal minimum wage requirement. However, there are some situations where one will not get paid. We will tell you when the minimum wage for your internship counts.
- Facts about minimum wage
- Who receives minimum wage
- Minimum wage and internship
- Impact of the minimum wage on internship offers
Facts about minimum wage
From 2015, the law requires companies to pay the minimum wage to trainees in Germany. Since January 2017 this rate is approximately $10 per hour. Through the minimum wage, the Federal Ministry of Labor and Social Affairs wants to prevent people from living a like without any income despite having full-time job. For a 40-hour week, a trainee/employee comes to a monthly gross salary of approximately 1,500 US Dollars. Interns are also entitled to the minimum wage. However, this is not paid in every internship. The stipulated hourly wage is only available under certain conditions.
First, the statutory minimum wage applies to all employees over 18 years of age. For the long-term unemployed, the minimum wage can be deviated in the first six months. But, of course, there are exceptions.
Who will receive the minimum wage?
You will not get a minimum wage if you:
- You are in an education program under the Vocational Training Act.
- You are volunteering.
- You are doing a voluntary service.
- To participate in work promotion.
- Working under the home Workers’ law.
Minimum wage and internship
Whether you receive remuneration for the minimum wage in your internship depends on different criteria. These are:
You are at least 18 years old; the minimum wage is only for adults. Minors are only entitled to the minimum wage if they have completed vocational training. This is intended to prevent an intern from dispensing with vocational training because of the comparatively high wage. In the short term, this would be financially beneficial, but in the long term, it would be disadvantageous, as long-term employment prospects would be better in the labor market, as well as better and higher earnings.
The internship lasts longer than 3 months; the minimum wage is only payable if the internship lasts longer than three months. This takes account of the fact that an intern does not immediately contribute to the company’s economic success. First of all, a training is needed, which costs the company time and money.
This is a voluntary internship: If it is an orientation study course or an internship lasting more than three months, it is necessary to pay for the minimum wage from the first day of employment. Even if the internship is extended after three months, the minimum wage takes retroactive effect. If you have a voluntary internship that only takes three months, your company does not have to pay the minimum wage.
In the case of compulsory internships, you are not entitled to a minimum wage. If a compulsory internship is required by the school, training institution or university, the trainees have no claim to the minimum wage. The same applies to an internship within the scope of a vocational training preparation or in a company entrance qualification. The minimum wage legislation is also not applicable to internships as part of an initial qualification according to SGB 3 and vocational training preparations according to the Vocational Training Act.
There are temporary derogations in the transitional period for a few sectors, regions, and groups of people. For example, long-term unemployed persons are only entitled to the minimum wage after six months regardless of whether this is an internship or a permanent job.
Other than these, no exceptions are possible. The minimum wage is compulsory. Trainees and other employees cannot waive the minimum wage and voluntarily settle for a lower compensation. You can also find out whether the minimum wage is included in your internship document/agreement.
The salary entitlement is in the employment contract
Anyone who is unsure whether he is entitled to the minimum wage in the internship should ask questions in the interview. Otherwise, take a look at the employment contract (before signing it.) In addition to the training objectives, the start and duration of the internship, the daily working hours, and the leave entitlement, the internship contract must also stipulate the internship in writing.
Making money in the internship is only an accessory
An internship is not primarily for making money. Instead, it should fulfill three other functions:
a. Earn practical experience
b. Making professional contacts/networking
c. Orientation for the future career choice
It is not fair to say that the performance of an intern and his contribution to the success of the company is also financially rewarded.
Impact of the minimum wage on job offers
It remains to be seen how the minimum wage affects the development of the job-markets in USA, UK, Germany, and other countries. There is a risk that the offer of longer internships will go down, especially for small and medium-sized enterprises, as they are no longer able or willing to pay the junior staff at this price. Many trainees will presumably benefit from the new scheme only theoretically, as a large part of the jobs will be reduced to a maximum of three months.
However, the law provides an advantage for young people who have to complete a compulsory internship within their (university) education. Since compulsory trainees do not fall under the minimum wage system, they may be given preference and may complete longer internships.
Surely, however, it can already be established that the myth of the so-called “generation internship” by the minimum wage belongs to the past. This term was used to describe highly qualified graduates who had to move from one less paid internship to the next at the beginning of their careers.