Working student contract: advantages for employers and employees (Guide 2024)
More and more students are choosing to work as working students in a company during their studies. A working student contract offers numerous advantages for both employers and working students and is therefore an attractive option for both sides.
In this article, we will examine the legal basis, the specifics of the contract, and the advantages for employers and working students. We will also discuss which specific aspects should be taken into account when drafting the contract and which requirements must be met.
Background information on the working student contract
A working student contract is a form of employment for students who want to work in a company while studying. Unlike marginal employment (mini-jobs), working students can work up to 20 hours per week and earn a higher salary.
Another special feature of the working student contract is that it constitutes employment subject to social security contributions, which means that both the employer and the working student must pay into pension, unemployment, and health insurance.
This means that working students are covered by social security during their studies and are entitled to benefits such as sick pay or unemployment benefits. For companies, employing working students offers the opportunity to respond flexibly and on a temporary basis to seasonal fluctuations, project peaks, or other challenges, while still securing qualified workers.
Legal basis of the working student contract
The legal framework for a working student contract in Germany is regulated by the Part-Time and Fixed-Term Employment Act (TzBfG). The working student contract is defined there as a form of part-time employment. According to Section 8 TzBfG, working students are generally not bound to fixed working hours, but work according to the employer's needs. In addition, working students are entitled to work a maximum of 20 hours per week during the lecture period.
There is no time limit during semester breaks. With regard to remuneration, the employer must pay the working student an appropriate wage, which is usually above the minimum wage. Working students are also subject to the same regulations as all other employees with regard to protection against dismissal.
If the contract is to be terminated properly, the statutory notice periods must be observed. Overall, the working student contract offers both employers and working students a legally secure form of employment.
Advantages of a working student contract for working students.
Working student contracts offer students a variety of benefits, including:
i. Practical experience in a real working environment: As working students, students have the opportunity to gain practical experience in a real working environment. In contrast to purely theoretical courses at university, working students can apply and deepen the skills and knowledge they have acquired in practice.
ii. Expansion of technical knowledge and soft skills: By working in a company, working students can deepen their technical knowledge and learn new skills. Soft skills such as teamwork, communication skills, and organizational talent can also be improved through a working student job.
iii. Opportunity to network and establish contacts in the industry: Working students have the chance to establish valuable contacts in the industry. These contacts can be very important later on in their studies or when looking for a job.
iv. Earning potential during your studies: Working students earn money and can thus finance their studies. Since working hours are limited, students have enough time for their studies and other activities.
v. Working students can benefit from various tax breaks: Since working students primarily study and do not work during their studies, they are usually classified in tax bracket 1. This means that they have a basic allowance of currently €9,744 per year and only have to pay taxes on income that exceeds this amount (see Working student contract taxes). Social security contributions, such as pension and unemployment insurance, are also comparatively low for working students. They do not have to pay unemployment insurance contributions and usually only pay the reduced contribution rate for pension insurance. These benefits make it more attractive for working students to seek employment in the form of a working student contract. However, they should be aware that they still have to file a tax return and may have to pay additional taxes if they have other sources of income or exceed the tax-free allowance.
How much can you save as a working student?
As a working student, you primarily save on social security contributions such as health, nursing care, pension, and unemployment insurance compared to regular employees (further article: Working student contract insurance). In many cases, income tax is also lower, as working students generally earn less than regular employees. Overall, this can lead to significant savings in wage costs.
As an example, consider a working student who earns €1,200 gross per month in 2023.
Compared to a regular employee with the same gross income, working students save around €400 to €500 per month due to lower social security contributions and taxes. While a regular employee has to pay social security contributions of around 20-22%, the contribution rate for working students is only 9.3% (as of 2023) and is paid equally by the employer and the employee.
In addition, working students are generally exempt from health insurance as long as they are still covered by their family's statutory health insurance. If they are not covered by family insurance, they must take out student health insurance, which is significantly cheaper than regular health insurance.
Working students are also exempt from paying income tax as long as their monthly income remains below the annual basic allowance of $9,408 (as of 2023). The solidarity surcharge also only applies above this amount.
However, it is important to note that despite the savings from lower social security contributions and no income tax, working students may still be liable for tax if they earn above certain allowances or have other sources of income.
Working student contract Advantages for employers
Working students can also be beneficial for employers. Here are some of the key advantages employers gain from hiring working students:
A. Cost savings through reduced labor costs
Since working students usually only work part-time and have not yet completed their studies, employers can save on wage costs. Compared to regular full-time employees, the remuneration of working students is significantly lower. At the same time, however, working students are often highly motivated and productive, which provides employers with a valuable resource.
B. Flexibility in personnel deployment planning
Working students can often be deployed flexibly to cope with short-term bottlenecks or projects. Due to their part-time employment and the fact that they usually have more flexible schedules than full-time employees, employers can react quickly to changes in workload.
C. Qualified workers with academic backgrounds
Working students are usually students or graduates with an academic background, which means that they have specific knowledge and skills that they have acquired during their studies. These skills can be directly applied to the job, providing employers with a pool of qualified employees.
D. Possibility of subsequent transfer to permanent employment
By employing working students, employers can attract potential full-time employees for the future. If working students perform well, there is a possibility that they can be hired for a full-time position later on. This allows employers to reduce the risk of hiring new employees, as they already know that the employee is a good fit for the company.
E. Tax advantages
A working student contract also offers tax advantages for employers. Social security contributions such as health, pension, unemployment, and long-term care insurance are not deducted from the working student's salary, which leads to significant cost savings for the employer. In addition, wage costs can be deducted as operating expenses, further reducing the tax burden. Compared to other forms of employment such as marginal employment or full-time positions, employers can therefore save considerably with a working student contract. However, employers must ensure that the working hours and salary of the working student comply with the legal framework.
When is a working student contract worthwhile?
A working student contract can be worthwhile for students who want to gain practical experience in a company during their studies and need to finance their studies at the same time. By working as a working student, students can expand their technical knowledge and soft skills, make valuable contacts in the industry, and earn money.
A working student contract also offers advantages for companies, as they can respond flexibly to seasonal fluctuations, project peaks, or other challenges on a temporary basis while still securing qualified workers.
A working student contract usually makes sense if the time and content requirements of the degree program are compatible with those of the employer and the employment as a working student does not negatively impact academic performance. It is also important to note that a working student contract is usually subject to social security contributions, which means that both the employer and the working student must pay into pension, unemployment, and health insurance.
Special features of the working student contract
Unlike regular employment contracts, working student contracts have a few special features that need to be taken into account. One of these features concerns working time regulations and working time quotas. Working students are generally allowed to work a maximum of 20 hours per week during their studies so as not to jeopardize their academic performance. However, in exceptional cases, it is possible to agree on longer working hours. In such cases, however, care should be taken to ensure that the working hours do not conflict with the student's exam schedule.
Another important point concerns health and social insurance. As a rule, working students are covered by their parents' health insurance. If this is not possible, they are obliged to take out insurance themselves. However, there is also the possibility that the employer will cover the costs of health insurance.
With regard to vacation entitlement and vacation regulations, working students are to be treated in the same way as regular employees. Entitlement to paid vacation is governed by the Working Hours Act and is based on the number of working days per week. However, it should be noted that vacation must be taken during the lecture-free period of the academic year.
Finally, it is important to consider the contract terms and notice periods. As a rule, a working student contract is concluded for a fixed term and ends automatically at the end of the student's studies or internship. The notice period for working student contracts is not regulated by law and can therefore be freely agreed upon. However, care should be taken to ensure that the notice period is reasonable in order to give the working student planning security and not to disadvantage them.
What should be considered when signing a working student contract?
There are several things to consider when signing a working student contract. Here are some important points:
- Working time regulations and working time quotas: There is usually a limit on the number of hours that can be worked per week to ensure that working students have sufficient time for their studies. Break regulations and overtime should also be specified in the contract.
- Health insurance and social security: Working students usually have to pay their own social security contributions, as they are generally classified as marginal employees. This also includes health insurance, for which working students can usually pay a reduced contribution rate if they are covered by family insurance.
- Vacation entitlement and vacation regulations: Working students are generally entitled to paid vacation. The exact number of vacation days depends on the number of hours worked per week. Vacation should be agreed upon with the employer in advance. (See article: Working student contract vacation)
- Contract terms and notice periods: The contract term and notice periods should be specified in the contract to give both parties planning security. The contract can usually be terminated by either party with one to three months' notice.
Beglaubitet.de as a legally compliant assistant
Beglaubigt.de offers a straightforward and time-saving solution for companies to create legally compliant working student contracts. As a legal tech platform, Beglaubigt.de uses a simple and free questionnaire that was developed specifically for creating working student contracts.
Based on the information provided by the employer and the working student, the platform automatically generates a contract that meets all legal requirements and is tailored to individual needs. This service saves companies time and resources in contract preparation and ensures that their working student contracts are legally compliant and correct.
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