Marginal employment (german: geringfügige Beschäftigung), also called a mini job or €520 job, is an employment relationship with a low absolute level of earnings or of short duration.

Germany

The term Mini job was coined in

Germany Germany,, officially the Federal Republic of Germany, is a country in Central Europe. It is the second most populous country in Europe after Russia, and the most populous member state of the European Union. Germany is situated betwe ...

to describe a form of marginal employment that is generally characterized as part-time with a low wage. According to the latest law, the monthly income of a mini job is €520 or less, exempting them from

income tax An income tax is a tax imposed on individuals or entities (taxpayers) in respect of the income or profits earned by them (commonly called taxable income). Income tax generally is computed as the product of a tax rate times the taxable income. Tax ...

. With the

Scholz cabinet The Scholz cabinet (German: ''Kabinett Scholz'', ) is the current cabinet of Germany, led by Federal Chancellor Olaf Scholz. The cabinet is composed of Scholz's Social Democratic Party, Alliance 90/The Greens and the Free Democratic Party, an a ...

raising the minimum wage to €12 per hour, the income cap for a ''mini job'' was increased to €520 per month since 1 October 2022. The previous increase was the 1 January 2013 from 400 to 450 euros. In 2002 the Hartz commission recommended a series of measures to revitalise the German economy, known collectively as the

Hartz concept The Hartz concept, also known as Hartz reforms or the Hartz plan, is a set of recommendations submitted by a committee on reforms to the German labour market in 2002. Named after the head of the committee, Peter Hartz, these recommendations went o ...

Gerhard Schröder Gerhard Fritz Kurt "Gerd" Schröder (; born 7 April 1944) is a German lobbyist and former politician, who served as the chancellor of Germany from 1998 to 2005. From 1999 to 2004, he was also the Leader of the Social Democratic Party of Germany ...

implemented it as part of his

Agenda 2010 The Agenda 2010 is a series of reforms planned and executed by the German government in the early 2000s, a Social-Democrats/ Greens coalition at that time, which aimed to reform the German welfare system and labour relations. The declared objectiv ...

reforms in 2003 as part of a labor market reform. Mini jobs were introduced as part of Hartz II, which took effect on 1 January 2003. At the time Germany had no

minimum wage A minimum wage is the lowest remuneration that employers can legally pay their employees—the price floor below which employees may not sell their labor. Most countries had introduced minimum wage legislation by the end of the 20th century. Bec ...

, which was not introduced until 2015. The German government enacted legislation that ensures that employers pay

social insurance Social insurance is a form of Social protection, social welfare that provides insurance against economic risks. The insurance may be provided publicly or through the subsidizing of private insurance. In contrast to other forms of Welfare, soci ...

for mini job workers. All German industries are allowed to offer mini job contracts, but the most common types of mini jobs are in the fields of catering, retail, and domestic work. Mini jobs were first intended to legalize informal work and to become a means of promoting employment. However, mini-jobs are tax-free and relatively abundant. For this reason, mini jobs are well-liked as secondary jobs. The employer pays a lump sum of 20% (including

health insurance Health insurance or medical insurance (also known as medical aid in South Africa) is a type of insurance that covers the whole or a part of the risk of a person incurring medical expenses. As with other types of insurance, risk is shared among ma ...

: 8%,

pension fund A pension fund, also known as a superannuation fund in some countries, is any plan, fund, or scheme which provides retirement income. Pension funds typically have large amounts of money to invest and are the major investors in listed and priva ...

: 10%, wage tax: 2%, as of 1 July 2006), or 18% in the case of domestic help for the pension fund and health insurance. The employer takes out additional

accident insurance Accident insurance is a type of insurance where the policy holder is paid directly in the event of an accident resulting in injury of the insured. The insured can spend the benefit payment however they choose. Accident insurance is complementary to ...

for his employees, costing about an additional €60 per year. The cost of the accident insurance differs from state to state. Employees of mini jobs must be treated the same as full-time employees, except with cause. If full-time employees receive benefits, part-time employees receive a pro-rata share. A mini job can be taken during the six weeks of

maternity leave Parental leave, or family leave, is an employee benefit available in almost all countries. The term "parental leave" may include maternity, Paternity (law), paternity, and adoption leave; or may be used distinctively from "maternity leave" and ...

prior to giving birth and during

parental leave Parental leave, or family leave, is an employee benefit available in almost all countries. The term "parental leave" may include maternity, Paternity (law), paternity, and adoption leave; or may be used distinctively from "maternity leave" an ...

. However, the worker is not allowed to work more than 30 hours a week. Christmas bonuses or holiday pay may cause the €520 limit to be exceeded. The employer must pay tax on such income. In March 2009 there were about 4.9 million people in Germany on tax-free "mini jobs". Those whose main job is a mini-job still contribute to the national retirement pension insurance. The employee pays 3.7% and the employer pays 15%. They contribute neither to the national health insurance funds nor for unemployment coverage. They can either be covered by the health insurance of a higher earning partner (or parents, for students up to 25 years of age) or contribute voluntarily at a flat rate of €140 per month.

Spain

On 7 December 2011 it was reported that the

European Central Bank The European Central Bank (ECB) is the prime component of the monetary Eurosystem and the European System of Central Banks (ESCB) as well as one of seven institutions of the European Union. It is one of the world's Big Four (banking)#Intern ...

sent a letter in August to

José Luis Rodríguez Zapatero José Luis Rodríguez Zapatero (; born 4 August 1960) is a Spanish politician and member of the Spanish Socialist Workers' Party (PSOE). He was the Prime Minister of Spain being elected for two terms, in the 2004 and 2008 general elections ...

government A government is the system or group of people governing an organized community, generally a state. In the case of its broad associative definition, government normally consists of legislature, executive, and judiciary. Government is a ...

, suggesting that Spain implemented a mini jobs job category with salaries of €400, a value considerably lower than Spain's minimum wage of €641. This suggestion was presented as a condition for the European Central Bank to continue purchasing Spain's debt.

United Kingdom

In the United Kingdom about 1.4 million people work under

zero-hour contract A zero-hour contract is a type of employment contract between an employer and an employee whereby the employer is not obliged to provide any minimum number of working hours to the employee. The term 'zero-hour contract' is primarily used in th ...

s, with no guaranteed hours of work. A person earning under £5,772 a year receives no credits for the state pension. In 2012,

Justice Minister A justice ministry, ministry of justice, or department of justice is a ministry or other government agency in charge of the administration of justice. The ministry or department is often headed by a minister of justice (minister for justice in a v ...

Liz Truss Mary Elizabeth Truss (born 26 July 1975) is a British politician who briefly served as Prime Minister of the United Kingdom and Leader of the Conservative Party from September to October 2022. On her fiftieth day in office, she stepped down ...

championed the idea of Britain following Germany's lead in allowing people to have tax-free and less-regulated mini jobs.

References

External links

"Low-paid Germans mind rich-poor gap as elections approach"
Kate Connolly; Louise Osborne (30 August 2013). {{Authority control German labour law Labour law Employment classifications

Germany

Spain

United Kingdom

See also

References

External links