Preconditions for granting a license to operate a temporary employment agency

Tem­po­rary employ­ment agen­cies require a license in Ger­many (read more…). Apart from the absence of grounds for denial which are reflect­ed by the applicant’s con­duct (read more…), the appli­cant must also have appro­pri­ate legal and indus­try knowl­edge for the required reli­a­bil­i­ty.

Legal and industry knowledge

Appli­cants with­out rel­e­vant expe­ri­ence in the tem­po­rary employ­ment sec­tor may also apply for a tem­po­rary employ­ment per­mit.  How­ev­er, if the appli­cant does not have the required knowl­edge, so that it must be expect­ed that he will not car­ry out his activ­i­ties in accor­dance with the law, the license can then be denied.

The Fed­er­al Employ­ment Agency (Bun­de­sagen­tur für Arbeit) requires the appli­cant to pro­vide evi­dence of basic knowl­edge of employ­ment, social secu­ri­ty and tax law and usu­al­ly con­sid­ers this require­ment to be ful­filled if

  • the appli­cant has a track record as a busi­nessper­son,
  • the appli­cant has com­plet­ed com­mer­cial train­ing,
  • the appli­cant has worked for sev­er­al years in the HR depart­ment of a com­pa­ny,
  • the appli­cant has attend­ed a sem­i­nar on the sub­ject of tem­po­rary employ­ment,
  • the appli­cant has par­tic­i­pat­ed in a course for busi­ness start-ups offered by the Cham­ber of Indus­try and Com­merce (IHK) or a com­pa­ra­ble course, or
  • the com­pa­ny has been oper­at­ing as a mixed com­pa­ny for a long time.

Practical tip

The Fed­er­al Employ­ment Agency often insists on sub­mis­sion of a cer­tifi­cate of par­tic­i­pa­tion in a cor­re­spond­ing (also one-day) train­ing course. This cer­tifi­cate is often suf­fi­cient for the Fed­er­al Employ­ment Agency as proof of the required knowl­edge.

Sound economic situation

The tem­po­rary employ­ment agency must be able to ful­fil its oblig­a­tions to pay wages, social secu­ri­ty con­tri­bu­tions and tax­es. Liq­uid funds of €2,000 per tem­po­rary employ­ee must be pro­vid­ed for each tem­po­rary employ­ee, how­ev­er, a min­i­mum of €10,000. Proof of guar­an­tees or loan com­mit­ments is suf­fi­cient.

As long as the com­pa­ny can be con­tin­ued in accor­dance with sec. 22 (1) no. 2 or sec. 230 (1) of the Insol­ven­cy Statute (InsO, Insol­ven­zord­nung), even the open­ing of insol­ven­cy pro­ceed­ings does pre­vent the grant­i­ng of the license.