False self-employment or “Scheinselbstständigkeit”
What is known as “false” or “bogus” self-employment (“Scheinselbständigkeit“) may exist if someone claims to be self-employed, although their relationship to the client points to dependent employment. It is often difficult to distinguish between genuine self-employment and regular employment. Multiple factors from several fields of law need to be taken in account: employment law, social security law and tax law. An English language example is available from the Office for the Equal Treatment of EU Workers.
Employee-like employment or “arbeitnehmerähnlichen Selbstständigkeit”
Are you are legitimately self-employed but work only for one client? Then you might have to join statutory pension insurance. Statutory pension insurance is compulsory for certain occupational groups such as teachers, artists, nurses, licensed craftsmen and those who have mainly only one client. In the statutory pension they are known as “Selbstständige mit einem Auftraggeber“. Learn more about pension insurance and who to contact for professional advice.
Beware: False self-employment and employee-like employment can lead to unpleasant consequences for both the client as well as the entrepreneur.
For advice and further information please see our feature laws and contracts.