The placement of employees by an employer with a customer is referred to as personnel placement. In order to protect employees, certain conditions must be met. If these are not met, it is a case of covert employee leasing. Covert employee leasing is against the law and can result in legal penalties for both the personnel service provider and the hirer. It should therefore be avoided at all costs. We at Arbeitswelt Personaldienstleistung GmbH & Co KG will clarify the situation for you.
What is covert employee leasing?
Covert employee leasing is when a personnel service provider lends workers to a customer without official permission . It is also illegal toconceal the fact that it is an employee leasing at all and not, for example, a contract for work or services between the hirer and the employee. The following omissions should be avoided when hiring out employees:
- Hiringout employees without first obtaining a permit
- Falsely billing the employee as a self-employed person
- Employment relationship is falsely declared as a contract for work and services
Why is it prohibited and what are the consequences?
Covert employee leasing is illegal because the employee has no legal protection without contractual protection. For example, the hirer may withhold wage payments or fail to register for social security. In the case of illegal employee leasing, both the lender and the hirer can face heavy fines .
A violation of the obligation to register for social security is punishable by up to 25,000euros, and hiring out employees without a permit is punishable by up to 30,000 euros. If the employment of workers can be classified as moonlighting, the penalty is up to 50,000 euros. Most dramatic, however, are the consequences of withholding or embezzlement of wages by the hirer. This offense can be punished with up to five years in prison.
How can covert employee leasing be avoided?
To avoid covert employee leasing, make sure you have an official permit to place your workers. The relationship between the hirer and the employee should then be clearly defined in the contract, i.e. it must be clear that it is neither a contract for work nor an employment of self-employed labor. The lender and the hirer conclude a temporary employment contract with each other and the hirer fulfills the obligation to register the employee for social security. By contractually defining the relations, all parties involved are legally secured and the employee leasing is legal.
Personnel placement via Arbeitswelt Personaldienstleistung GmbH & Co. KG
Arbeitswelt Personaldienstleistung GmbH & Co KG is your contact in the field of personnel placement with offices in Cuxhaven, Nordhorn, Bremerhaven, Troisdorf and Hamburg. Our company has been responsible for the placement of freelancers and temporary workers for ten years, whereby the legal protection of all parties as well as the mutual encounter at eye level is our top priority. Please feel free to contact us if you have any questions regarding personnel placement: