Germany employment law: Oral contracts and EU salary inquiry bans

Recent legal insights in Germany highlight two significant aspects of employment law. First, labor law expert Jakob T. Lange explains that a written contract is not strictly required to begin a job; an oral agreement or a ‘handshake’ is legally binding. If essential terms have been verbally agreed upon, employees must report for work on the scheduled date, and employers must accept the labor, even if a signed document is pending. While the Nachweisgesetz requires written documentation, Lange notes that non-compliance often only results in fines, which may not sufficiently protect employees in specific disputes.

Separately, EU Directive 2023/970 is changing recruitment practices by prohibiting employers from asking candidates about their previous or current salary history. While the deadline for implementation passed on June 7, 2026, the application in Germany varies. The ban applies directly to public employers, but its application to private companies depends on the status of national implementation laws. The directive aims to address salary negotiation discomfort, as studies show a high percentage of employees, particularly women, feel uneasy during pay discussions.