New employee sick in the first four weeks in Germany: who pays the wage

Who pays the wage when a new employee in Germany falls ill in the first four weeks?

In the first four weeks of a new employment relationship in Germany, the employer does not yet owe continued pay. § 3 (3) EntgFG links the claim to continued pay to four weeks of uninterrupted duration of the employment relationship. For incapacity that starts before that, the BMAS states that employees subject to compulsory insurance have a claim to sickness benefit (Krankengeld) from their health insurance fund. Sickness benefit is the cash benefit of the statutory health insurance that steps in when wages stop.

The legal basis for that claim is § 44 SGB V, which grants insured persons sickness benefit when they are unable to work because of illness. Whether the claim exists in a specific case is decided by the health insurance fund, not by you and not by us. Your part is the payroll side: no continued pay yet, plus the electronic sick note retrieval described further down.

Continued pay from the employer or sickness benefit from the health fund: what actually differs

The practical consequence for a new hire is a gap in income. Sickness benefit replaces part of the pay, not all of it, because § 47 SGB V caps it at 70 percent of the regular pay subject to contributions and at 90 percent of the corresponding net pay. Employees who have just arrived in Germany rarely expect that. Saying it plainly at the start of the job avoids a difficult conversation later.

From week five onwards: how much you continue to pay, and for how long

Once the employment relationship has run four uninterrupted weeks, you owe continued pay for the period of incapacity, up to six weeks (§ 3 (1) EntgFG). The condition in the law is incapacity due to illness that the employee has not caused through their own fault. § 4 EntgFG sets the basis of calculation: you continue to pay the remuneration corresponding to the regular working time. Pay granted additionally for overtime does not count towards it, and a collective agreement may define a different basis of assessment.

§ 8 EntgFG adds one point that often comes up in a young employment relationship. The entitlement to continued pay is not affected by the fact that the employer terminates the employment on account of the incapacity. If the employment relationship ends for other reasons before the six weeks are over, the entitlement ends with the employment relationship. The norm says nothing about whether a termination is effective — that question belongs to employment law and, in a dispute, to the labour courts.

What your new employee must report to you — and what you retrieve as the electronic sick note (eAU)

An employee in Germany must notify the employer of the incapacity and its expected duration without undue delay, and that duty applies from the first day of the job. § 5 EntgFG sets out the details, and the electronic retrieval procedure does not replace that call or message.

• Notification: immediately to the employer, stating the expected duration (§ 5 EntgFG).
• Medical certificate: if the incapacity lasts longer than three calendar days, at the latest on the following working day; the employer may demand it earlier (§ 5 EntgFG).
• Longer absence: a new certificate is required if the incapacity continues beyond the certified period (§ 5 EntgFG).
• Notice to the fund: people with statutory insurance must also report the incapacity and its duration to their health insurance fund without undue delay (§ 5 EntgFG).
• Your retrieval: the fund prepares a message for the employer with name, start and end of the incapacity, the date of the medical finding, whether it is a first or follow-up notification, and any indication of grounds for a work accident (§ 109 SGB IV).

The retrieval runs through a tested payroll program or a filling aid, and you may commission a third party to do it (§ 109 SGB IV). Two further points matter for the money. The sickness benefit claim arises from the day the incapacity is medically established, or from the start of hospital treatment (§ 46 SGB V). And § 49 SGB V provides that the claim rests, among other situations, while pay is received and where the incapacity is not reported to the fund.

Can you get continued pay reimbursed? The U1 procedure for employers with up to 30 employees

Employers with no more than 30 employees can have part of the continued pay reimbursed by the health insurance funds. § 1 AAG names 80 percent of the continued remuneration plus the employer's share of the contributions attributable to it. The AAG also allows the statutes of the individual health insurance fund to provide for a different rate, so the rate that applies to you follows from the statutes of your employee's fund. Whether your company takes part in the procedure at all is determined by the fund.

The reimbursement relates to pay you have actually continued. In the first four weeks, when no continued pay is owed, there is nothing to reimburse. The funds for the procedure are raised through levies paid by the participating employers (§ 7 AAG). If you are unsure about your status, the health insurance fund of your employees is the body that answers it.

Accident at work in the first weeks: a different body decides on the benefits

If the incapacity follows an accident at work or an occupational disease, the statutory accident insurance comes into play alongside the health insurance fund. Which cash benefits are paid, from when and in what amount, is decided by the responsible accident insurance institution in the individual case. The BMAS explains in its questions and answers what the statutory accident insurance covers. Do not assume the same pattern as for an ordinary illness — the payer and the procedure are different.

One detail of the electronic procedure helps you notice such a case early. The message that the health insurance fund prepares for employer retrieval contains an indication of whether there are grounds to suspect a work accident (§ 109 SGB IV). The reporting duties under § 5 EntgFG apply to the incapacity as such, whatever caused it. Your employee therefore still has to notify you without delay and still has to produce a certificate within the stated deadline.

Before any of this works: registering your new employee with social security

Sickness benefit, the electronic sick note and the U1 reimbursement all run through the employee's health insurance fund, so the registration with social security has to be in place. § 28a SGB IV obliges employers to submit reports for employees subject to compulsory insurance, including a registration when the employment begins. For a worker arriving from abroad, that step falls into the same days as the first shift, the residence formalities and the move into accommodation.

Treat the sick-leave rules as part of your first-week briefing, not as something to look up when it happens. Tell the new employee whom to call, by when, and that a certificate is needed after three calendar days. Our page on onboarding foreign employees in the first weeks covers the wider setup, and employer obligations for third-country nationals covers the documents you keep on file. If the person never arrives at all, that is a different situation — see new employee never showed up for the first day.

If you are hiring workers from Albania or Kosovo and want support with employment contracts and employment documents, you can register as an employer.