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AUG Licence in Germany

How Boundless employs your workers

To employ your workers in a compliant way locally in Germany, Boundless holds what is known as an AUG Licence. Such a licence is required by law for companies hiring people to work on behalf of other companies in Germany, as part of a global PEO solution. This is applicable regardless if the employees do traditional temporary work or not—what matters is that they are “seconded” to another company. 

All AUG licence holders are tightly regulated by authorities, who want to make sure that leased employees have equal rights to comparable employees not hired through the AUG. This includes all protections from dismissal, extended by German employment law.

Working through an AUG licence for a company is possible for 18 consecutive months only. We would love to be in a position to employ people for longer periods of time in Germany but, unfortunately, that would put everyone in a position of non-compliance.

What Boundless does for you

As the AUG licence holder, we establish and maintain the legal employment relationship with the worker. That starts by signing a fixed-term employment agreement with them which is for a maximum of 18 months. The company that the individual performs work for does not appear on that employment agreement. 

Based on which statutory healthcare insurance (Krankenkasse) the employee chooses, we inform the insurance provider of the start and the end of employment. 

Every month we calculate the payroll, deduct all mandatory contributions such as the insurance premium, and provide the worker with a payslip. 

We file all necessary taxes and pay mandatory contributions to respective authorities.

What you do

You sign our standard commercial agreement that we use for most of the countries we are in, which you can end with one month's notice. 

You then sign two additional agreements - a Framework Agreement and an Individual Agreement. 

The Framework agreement is relatively straightforward, stating that you agree to let us lease workers to you. It just needs your company details and is signed only once regardless of how many employees you employ through us. 

The Individual Agreement is based on the individual employment and is signed to prove that any comparable employee isn’t getting better rights, benefits or working conditions than the leased one. This is probably the most important document that may be audited by authorities and requires some more information in advance, such as remuneration, job characteristics, relevant professional qualifications and comparable conditionals and remuneration of employment. One of these agreements needs to be completed for each individual you employ through us.

An important thing to note is that all agreements require a wet ink signature or a Qualified Electronic Signature (QES). We send you all agreements through our e-signing software to sign with a Qualified Electronic Signature. 

What the Employee does

The employee signs an employment contract with Boundless with a wet ink signature before the start of the employment. It is a requirement that the working conditions have to be documented in writing and wet-ink signed by all parties. Organising wet ink signatures takes approximately 1-2 weeks.

If an employee wants to end their employment before the 18 months expire, they will need to send us the resignation letter with a wet ink signature by post, stating their resignation and last working day. 

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