Employee share

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The employee's share of the Social Security is the part which is deducted from gross pay the employee the social security contribution, and is made up of the contributions to health insurance, long term care insurance, pension insurance and unemployment insurance. The entire contribution to social security in West Germany was paid half by the employer ( employer's share ) and half by the employee. Several reforms have since postponed this relationship. For example, when long-term care insurance is introduced, employers are compensated for their share of long-term care insurance by removing a public holiday. The employer's share of long-term care insurance is smaller than the employee's share, the employer's share of health insurance is smaller than that of the employee and has been set at 7.3% of gross wages since January 1, 2011, i.e. increases in health care costs are unilaterally borne by the employees. At present (Sept. 2011) the share of a childless employee in the social security is around 52.5%, the employer's share around 47.5% (without taking into account the canceled public holiday, which in turn amounts to around 0.45 percentage points ).


However, the employee must earn both shares with his productivity in order to be profitable for the company (see employer contribution on this matter ). For this reason, it is sometimes stated that the division into employer's and employee's share obscures the actual burden. The employer's share of the social security contribution is merely a wage withheld by the state from the employee. The burden for the entire contribution would only lie with the employee. If the employer didn't have to pay his own contributions, he could pay higher wages and salaries.

On the other hand, the objection is made that the employer's economic possibility of paying higher wages does not necessarily have to be turned into reality. In the case of weaker trade unions, without a statutory distribution of the social security contribution, half of the cost increases in the social systems could not easily be passed on to the employers. On the other hand, strong unions could force employers to make further financial concessions and thus claim a larger financial share in the productivity of the workforce. In this more differentiated view, depending on market power and bargaining power, the burden of social security contributions is distributed between employers and employees.


  • Michael Preißer, Stefan Sieben: Retirement Income Act. 3rd completely revised edition, Haufe Mediengruppe, Munich 2006, ISBN 3-448-07462-4 .
  • Jürgen Plenker: Tax manual for the pay office 2016. 22nd edition, Verlagsgruppe Hüthing, Jehle, Rehm GmbH, Heidelberg 2016, ISBN 978-3-8073-2512-5 .

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