Marginal employment: All info at a glance

Marginal employment, mini-job or 450-euro job are three terms used to describe the same thing in each case. Here, consumers can find out everything they need to know about the special features of mini-jobs, what taxes are due and what social security contributions have to be made.

Significance of marginal employment

What is the difference between minijob and marginal employment??

Marginal employment is also called a mini-job because it is marginal according to the law. Legally, everything is regulated in § 8 SGB IV.

An employment is called a mini-job if it is subject to special conditions with regard to wage tax and social security contributions. This can be either a job that pays a maximum of 450 euros per month (marginal employment) or a job that is short-term (short-term employment). A marginally employed person is to be legally distinguished from a low-income earner.

Special features of marginal employment

If people are marginally employed, they are not subject to social security contributions and do not have to pay social security contributions. Although they are still subject to pension insurance, they can be exempted from this. Likewise, there are special features with regard to income tax. This is why this type of employment is also called marginal employment, which is not subject to social security contributions.

Since the marginal earnings threshold rose from 400 to 450 euros at the beginning of 2013, in a few cases there is still talk of a 400-euro job. For the mini-jobber himself, there are many advantages to this employment relationship: If he performs the mini-job alongside his actual job, the employer pays the social security contributions and taxes incurred for this job. The up to 450 Euro are paid without deductions.

If mini-jobbers are exempt from the obligation to pay pension insurance, they do not have to pay this contribution. It is also worthwhile for employers to employ mini-jobbers: This makes it much easier to compensate for cyclical fluctuations.

Who is allowed to do a mini-job?

Employees, the unemployed, pupils over a certain age as vacation jobbers, students or pensioners: If people want to earn some extra money, they can take up a marginal job.

How many hours per week may I work in marginal employment?

Whereas the working hours of a mini-jobber used to be limited to 15 hours per week, since 2013 marginal employment has only been defined in terms of earnings: It may not be more than 450 euros per month.

Mini-jobbers are subject to a flexible regulation of working hours, which allows an employer to react to fluctuations in demand, seasonal peaks or staff shortages and still comply with the earnings limit. In this case, the total working time of the mini-jobber may be divided in such a way that employees as marginal employees in the year no more than 5.You are allowed to earn 400 euros with your mini-job and the limit of 450 euros is exceeded on a maximum of three months. This allows minijobbers to be employed flexibly. As a mini-jobber, you earn a little more in one month – and a little less in another month.

Employment contract

In principle, an employment contract is required for marginal employment in a part-time job. However, a verbal agreement is sufficient for the time being, but it should later also be in written form.

Everything important is stated in the employment contract: The activity performed in the mini-job, the working hours to be performed, the place of work, the remuneration and any notice periods.

The employment contract includes:

• The company with name and address
• The place of work
• The employee with name and address
• The start date of the 450-euro job
• If it is limited in time: the duration of the mini-job
• A description of the work to be performed
• Working hours
• The entitlement to vacation
• The remuneration
• The notice periods

If the employment contract was concluded orally, it is still valid. If a dispute arises before the labor court, both sides must prove what they have agreed upon. In principle, a mini-jobber has the same rights as a full-time employee. He is entitled to vacation as well as protection against dismissal and maternity leave.

If it is a temporary employment relationship, a written employment contract is mandatory. If this is missing and the contract is only concluded verbally, the time limit is invalid and the mini-jobber is permanently employed.

There are sample employment contracts that entrepreneurs like to use. All necessary data is entered in these and the effort is reduced to a minimum.

Working hours

Since 2013, marginal employment has not been defined by the hours worked per week, but by salary.

Mini-jobbers are also entitled to the legally stipulated minimum wage. This rose on 1. January 2017 to 8.84 euros per hour. However, at the same time, the remuneration limit of 450 euros per month applies. If you receive the minimum wage for your mini-job, you have reached your earnings limit with a working time of just under 50 hours per month.

Since the introduction of the minimum wage law, employers are obliged to list in detail the hours worked for each mini-jobber. If close family members are employed or people work as mini-jobbers in a private household, there is no obligation to record the working hours.

There is no maximum limit for the hourly wage: mini-jobbers may, of course, receive more than 8.84 euros per hour and then also work less: More than 450 euros per month is not possible. Short-term employment is different: here the hourly wage may only be about 12 euros.

Health insurance

Who pays the health insurance?

If people are employed in a main job, then they are also covered by health insurance and pay your health insurance contributions on your income quite normally. In the case of marginal employment, the employer deducts a flat-rate amount for social insurance purposes.

If mini-jobbers are family members with health insurance through their spouses, this remains the case even if they have a mini-job.

If people are unemployed and receive unemployment benefits from the job center, they are covered by the job center's health insurance.

If no health insurance has been taken out, citizens must take care of this themselves and take out private or voluntary statutory health insurance: The employer pays only a lump sum for social insurance, which benefits the general health fund and does not establish a health insurance relationship for them.

In the case of refugees, the following applies: Those who have a work permit as a refugee may work in a 450-euro job. However, since refugees do not have statutory health insurance, the employer does not have to pay the flat-rate amount, thus saving the 13 percent that he would otherwise have to pay to the Knappschaft-Bahn-See (miners' insurance fund).

Pension insurance

Collect points and contributions for pension despite marginal employment

Since the 1. From January 2013, all mini-jobbers must pay contributions for statutory pension insurance. That means concretely: from 450 Euro gross 433,35 Euro net are paid monthly. Your contribution of 16.65 euros, however, is only the difference, after all, the employer already pays 15 percent. However, the pension insurance obligation not only ensures that less is paid out, it is also beneficial:

• People acquire mandatory working hours with it. If citizens want to receive retraining, medical rehabilitation or any other benefit, they have to prove it.
• Pension entitlements increase, albeit only slightly. For every year for which mini-jobbers pay pension contributions, they will later receive approximately 3.46 euros more in pension per month – just because of the lump-sum payments from your employer. If citizens also pay their contribution, the monthly pension increases to 4.36 euros.
• People profit from the national promotion for the age precaution: If they pay at least 60 euro annually into a so-called Riester contract, these receive 154 euro at national allowance and additionally for each child born starting from 2008 300 euro. For children born before 2008, there is an annual allowance of 185 euros.

There is the possibility to be exempted from the obligation to pay pension insurance. Explain people to her employer the waiver in writing and he will inform the mini-job center about it. This has one month for an objection, otherwise the request for waiver is considered approved.

Marginal employment: social security

For marginal employees, employers must pay social security contributions to the Minijob-Zentrale (mini-job agency). However, there is a difference depending on whether the employment is in a commercial enterprise or in a private household.

A flat rate of 13 percent is to be paid by the employer for health insurance in the case of a commercial mini-job, 5 percent in the case of a private household.

If people are not subject to pension insurance as employees, the employer pays 15 percent as a lump-sum contribution to pension insurance in the case of a commercial mini-job and 5 percent in the case of private households.

If people are required to pay pension insurance as employees, the employer pays 3.7 percent in a commercial mini-job and 13.7 percent in a private household in contributions.

Special feature in private households

A mini-job in a private household is a special form of marginal employment. These mini-jobs are especially encouraged by the legislator: On the one hand, the employer has to pay lower lump sums and, on the other hand, can deduct a part of his costs from taxes. On the Minijob-Zentrale website, consumers can find a household check calculator that any employer can use to quickly work out how big the tax advantage is. Usually this is greater than the duties that are due.

Minijobber should also work in the private household subject to social security contributions. This brings advantages for both sides.

Vacation entitlement

In principle, mini-jobbers – like other employees – have a legal right to paid leave. This is what the Federal Vacation Act (BUrlG) says. That is at least 24 working days.

If the general entitlement to paid vacation in the company is higher than the minimum entitlement set by law, you are entitled to it even if you are a marginal employee. Your mini-job puts you on the same footing as a regular employee in this regard.

How is entitlement to leave calculated in the case of marginal employment?

The formula is: multiply the working days per week by 24 days of vacation set by law and then divide by six working days per week.

Working days Vacation days

1 per week 1 x 24 / 6	4 days of vacation per year
2 per week 2 x 24 / 6	8 days of vacation per year
3 per week 3 x 24 / 6	12 days of vacation per year
4 per week 4 x 24 / 6	16 days of vacation annually
5 per week 5 x 24 / 6	20 days of vacation per year
6 per week 6 x 24 / 6	24 days of vacation annually

Even if the calculation seems somewhat complicated at first glance, this is due to the fact that the legislator still takes the six-day week as a basis for calculation and at the same time wanted to achieve that every employee has a right to four weeks' vacation. If you work only one day a week, you can make a total of four weeks vacation with four vacation days in succession.

Termination

When in marginal employment, mini-jobbers have the same duties and rights as all other employees. This applies – as just described – to the vacation, but also to the termination. In principle applies: A notice must take place in each case in writing. It must be on paper and signed in person: Neither mail, nor fax, nor even SMS is acceptable.

The notice should include the employer's full address in addition to the name and address. The subject line should read: "Cancellation of employment contract" and the date.

It should be recorded when mini-jobbers want to quit, whether at the earliest possible date or on notice. What is the deadline for termination is listed in the employment contract.

The notice period according to the German Civil Code

If no deadline is specified in the employment contract, the German Civil Code (BGB) applies. This sets the notice period to four weeks. Mini-jobbers can choose to be paid at the 15. or cancel at the end of the month.

The notice period becomes the longer, the longer mini-jobbers are already employed in the company. If they have been employed there for two years, notice can only be given at the end of the month. This figure rises to seven months for twenty years of activity. If mini-jobbers are in the probationary period, they can terminate with a two-week notice period.

The termination agreement:
Minijobbers can also terminate their contract with a termination agreement and thus circumvent the prescribed notice period. You mutually agree with your employer to terminate the mini-job. This contract must be in writing.

A proper notice:
This does not require a reason. If marginally employed persons wish to give extraordinary notice of termination of their mini-job, they must cite an important reason.

The extraordinary termination

With this termination, the otherwise usual notice periods do not have to be observed: This is why it is also referred to as termination without notice. Employees need good cause for extraordinary termination and must state this in the termination letter.

Since each extraordinary termination is an individual case, there are no generally valid reasons for this. In principle, the following applies: the reason must be serious enough so that termination without notice is not reasonable. This can be the case with gross insults or sexual harassment, but also if the employer is behind with the payment of wages, the occupational health and safety is grossly violated or another employee has been assaulted. Whether the extraordinary termination is lawful is decided on a case-by-case basis.

Then employees get a termination without notice from the employer:
Of course, the employer can also terminate the employment relationship as a mini-jobber without notice. Then employees must have received a warning beforehand. In addition, such termination without notice must be served within fourteen days after the reasons become known.

Marginal employment: Salary

For mini-jobbers, the employment relationship in a marginal job is what is commonly called a good deal. Employees receive their salary "gross for net", at least if they are exempt from compulsory pension insurance. The entrepreneur alone pays the duties due.

Pay attention to the limit of 5.400 euros
Employees are allowed to earn up to 5 per year in their minijob.Earn 400 euros: This can reasonably compensate for fluctuations. If a little more work is done in one month, mini-jobbers can lean back for it the next month so that the monthly payments of 450 euros are met.

However, mini-jobbers are also entitled to a pro-rata Christmas bonus and vacation pay: you must also take these one-off payments into account when calculating the income limit. If employees receive 420 euros a month for their work and they are paid a bonus of 400 euros before Christmas, that is already 5 euros over the whole year.440 euros, 3.33 euros too much each month. Even if the wage limit is exceeded by such a small amount, all the benefits of the mini-job are lost: employees are then not only liable for tax, but also fully liable for social security contributions.

Exception: twice a year may earn more
There is only one exception with which minijobbers can deviate from the rigid salary limit: If they work only occasionally, but in any case not predictably, and the salary is more than 450 euros, the benefits of the minijob remain in place. Until 2018, this applies to three months within a calendar year. Then even more than 5.400 euros are earned.

A mini-jobber fills in for a colleague who falls ill and works full-time for two months. The minijobber earns a full salary during this time, yet the minijob remains tax and contribution free. Unpredictable is such extra work, if it is caused by pregnancy or illness. However, substitution during the vacation season or peak times such as the Christmas business are predictable: If employees work more at these times, the fixed wage limit does not shift.

How mini-jobbers can still earn more than 450 euros per month

The limit of 450 euros only applies to classic cash wages paid out. Extras paid in addition to wages increase the actual salary, but do not count toward the salary limit. These include, for example:

• Allowances for travel expenses
• Voucher for refueling
• Aid to recovery
• Promoting health
• subsidy for kindergarten fees
• Transfer of computer, tablet and other electronic devices
• Benefits for company pension plans

Exercise leader in the mini-job

Are people part-time as an exercise leader in a club, educator, instructor, caregiver or similar, they care part-time old, sick or disabled people or they exercise a part-time artistic activity?

If people are in the service of a charitable organization, they can receive up to 2.save 400 euros per year in tax and social security contributions – in addition to the mini-job regulation. That's up to 650 euros a month, on which neither taxes nor social security contributions have to be paid: 450 euros mini-job and 200 euros exercise leader allowance.

A small loan in case of financial shortage

If only a financial bottleneck is to be compensated, a small loan is recommended. The short terms provide advantageous conditions. Loans between 100 and 3000 euros are possible. The state-regulated microloans can be applied for online via WebIdent procedure without any red tape.

Tax return

Where do I report and enter marginal employment on my tax return?

Since the employer pays a flat rate of taxes for the marginal employment, mini-jobbers do not have to pay any taxes. A tax return only has to be submitted to the tax office if employees have other sources of income. For the income from the mini-job, Annex N of the tax return ("Income from non-self-employed work") must be submitted.

Taxes

How is the marginal employment taxed?

Paying taxes can be worthwhile
The income limit for marginal employment is 450 euros per month. On this amount, the employer pays a maximum of nine euros per month in taxes. They can pay tax on the income they earn from it as usual, benefiting from the income-related expenses allowance, which is still 1 per year.000 euros.

One partner has a regular full-time job and the other partner has a mini-job: Then mini-jobbers are free of charge through their spouse in the health insurance family insured. Those who have income from rent or investments in addition to the mini-job quickly earn so much that the family insurance no longer applies. If the income exceeds the annual savers' lump sum, which for married couples is 1602 euros, voluntary contributions to health and long-term care insurance are due. It costs about 150 EUR per month. In this case, it is worth it if you pay regular taxes on the mini-job in exchange for remaining in the family insurance plan.

Pensioner

How does a marginal employment affect the pension?

Of course, people can take on a mini-job if they are already drawing a pension. In principle, pensioners are treated like all other marginal employees in terms of taxes and social security, but there are a few special features.

Most of these regulations apply when people are already receiving their old-age pension and have reached the standard retirement age required for it: Then employees do not have to pay pension insurance contributions, only the employer does. But these contribution payments do not increase the pension. If mini-jobbers still pay pension contributions themselves, they can use this to supplement their pensions.

Retired civil servant

If employees were civil servants in the past, they are entitled to their allowance as pensioners and as mini-jobbers and are exempt from the obligation to take out health insurance. Also for the pension insurance they do not need to contribute. Only the employer must pay the flat-rate contributions.

Minor employment in addition to main employment

Of course, in addition to a regular main job, a mini-job can also be taken and thus supplement the income. However, it happens that a major employer prohibits its employees to consent to it.

In principle: Either in the work or in the collective agreement is specified whether before taking up a possible mini-job the employer must be informed.

Does the employer have to be informed about my marginal employment??
Even if neither the employment contract nor the collective bargaining agreement stipulates that the employer must be informed, there is always an obligation to report the part-time job if it could interfere with the main job or represents competition to it.

In principle, the employer must agree to the taking up of a mini-job. However, he also does not have to simply approve every part-time job. If consumers compete with their main employer with the mini-job, he may prohibit it. In their free time, people should have enough opportunity to relax – and neither a vacation job nor a mini-job should cause them to spend so much time that their main job suffers as a result.

If the employer prohibits taking a mini-job, it is always necessary to consider each individual case. However, the employer must also justify his refusal and explain why taking on a mini-job would jeopardize the company's interests. A general ban on secondary employment is not permissible; it may only be prohibited if the ban is based on a business interest.