Germany has the largest economy in Europe and the third-largest in the world. So for global organizations, it's important to understand what benefits German employees want most. The employee benefits landscape in Germany is unique: shaped by a combination of legal requirements, cultural preferences, and modern incentives.
For businesses operating in or expanding to this market, offering competitive, localized benefits is key to attracting and retaining top talent. Here's a closer look at some of the benefits that are most important to understand in the Germany.
1. Long-Term Accounts ('Langzeitkonto')
Long-term accounts ('Langzeitkonto') are a unique benefit in Germany, designed to provide financial flexibility. Through this system, employees can voluntarily sacrifice part of their salary every month, which is then saved for future use. These funds can be put towards early retirement, extended parental leave, or sabbaticals (among others).
In Germany, it is more common for larger companies to have these kinds of long-term accounts. Smaller companies, however, are more likely to offer other, more limited benefits, such as family leave or part-time work.
For larger global organizations, long-term accounts are essential in enabling workers to take control of their work-life balance while planning for long-term goals.
2. Mobility Perks
Mobility benefits are highly valued in Germany, and options often go far beyond the traditional company car. As Sundara Deepan, Principal Buyer Enablement Advisor at Benify, said, "In Germany, mobility benefits that help employees reduce the cost of travel are definitely a big deal. A company car, discounted public transport, or access to bicycles — that is definitely something that is growing there."
Employers are increasingly offering subsidized public transportation passes, bicycle access, or even electric scooters. These perks align with Germany's focus on sustainability and provide employees with cost-effective and environmentally friendly commuting solutions.
3. Tax-Free Vouchers ('Sachbezug')
One of the most unique perks in Germany is the widespread use of tax-free vouchers, known as 'Sachbezug.' Employers can provide employees with these vouchers, which can then be redeemed at numerous retailers nationwide.
These vouchers effectively enhance employees’ income without increasing taxable salary — making them a cost-efficient perk for companies to offer. They are a creative way to reward employees and help them save on everyday expenses. This customizable benefit helps German workers save money on everyday expenses caters, while catering to their individual preferences and lifestyles.
4. Workers' Councils and Benefits Transparency
Workers' councils ('Betriebsrat') are a prominent part of Germany's labor market. These employee-elected bodies have the legal right to negotiate benefits packages with employers on behalf of employees. This process often ensures that offerings are transparent, fair, and aligned with employees' needs.
Workers' councils are voluntary and initiated by employees or unions. They are most common in larger organizations: in Germany, 97.5% of companies with more than 1,000 workers have a workers' council.
This collaborative approach strengthens trust between employers and their workforce, fostering a positive workplace culture.
5. Data Security
Germany has very strict data protection laws — partly stemming from World War II when surveillance was common. Today, employees in Germany expect their personal data is handled securely, especially when it comes to their benefits.
Germany's data protection regulations are influenced by the EU's General Data Protection Regulation (GDPR). For employers in Germany, offering competitive benefits is not just about meeting statutory obligations but delivering them through secure and compliant systems that puts employees’ minds at ease.
By utilizing platforms like Benify, companies can ensure their benefits programs adhere to these privacy standards while still giving employees a seamless and personalized experience.
How Can You Offer Competitive Benefits in Germany?
In Germany, businesses must go beyond the basic offerings and embrace the employees' unique expectations and ways of working. This is where Benify comes in!
Using Benify's platform, companies can easily integrate offerings like long-term accounts, mobility perks, and tax-free vouchers into their benefits packages — all while ensuring compliance with Germany's strict data privacy laws.
Download our Global Benefits Playbook to learn more about unique benefits that should be offered in different countries around the world.
