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What Is Arbeitnehmerüberlassung?
Arbeitnehmerüberlassung, or employee leasing, is the practice in Germany where a staffing agency employs a worker directly but assigns them to perform work under the direction of a separate client company. The employment relationship stays with the agency, while the client controls the day-to-day work, all governed by the rules set out in AÜG.
In employee leasing, the worker has two companies in the picture: the agency, which is the legal employer, and the client, who directs the actual work. Only the agency issues the paycheck.
Arbeitnehmerüberlassung at a Glance
| Attribute | Description |
|---|---|
| Legal Employer | The staffing agency (Verleiher) |
| Day-to-Day Direction | The client company (Entleiher) |
| Governing Law | AÜG (Arbeitnehmerüberlassungsgesetz) |
| Requires | A licensed agency and a leasing agreement |
| Assignment Cap | 18 months with the same client |
| Best For | Short-to-medium-term staffing needs in Germany |
Why Does It Matter?
Employee leasing offers companies workforce flexibility without the commitment of direct employment, but it comes with strict legal boundaries. Because the arrangement involves two companies with distinct roles, employers need clarity on which entity bears which legal responsibilities, particularly around social security, works council notification, and assignment length.
When Is It Used?
Arbeitnehmerüberlassung is relevant whenever a company:
- Needs temporary staff to cover peak demand or a specific project.
- Wants to test a role or team fit before offering direct employment.
- Uses an EOR structure to hire in Germany without establishing its own entity.
A UK e-commerce company needs warehouse staff in Germany for the holiday season. Rather than setting up a German entity, it engages a licensed staffing agency under an Arbeitnehmerüberlassung arrangement. The agency formally employs the workers, while the UK company directs their daily tasks at its warehouse.
Common Misconceptions
No. In Arbeitnehmerüberlassung, the staffing agency remains the legal employer throughout the assignment.
No. Leased workers are entitled to equal pay after a defined period and have works council representation rights at the client company.
No. The arrangement must comply with AÜG's licensing and procedural requirements to be legally valid.
No. The 18-month assignment limit with the same client applies, after which the worker's status must change.
Arbeitnehmerüberlassung allows a staffing agency to lease its employees to a client company for a defined period, under strict rules set by AÜG. It offers flexibility, but companies need to understand where legal employer responsibilities sit and track assignment duration carefully.
Need flexible staffing in Germany?
We'll help you weigh Arbeitnehmerüberlassung against direct employment or an EOR for your German hiring needs.
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