Table of Contents
- Mandatory Time Tracking and Weekly Maximum Working Hours – Update 2025: What is the current situation in Germany?
- Bureaucracy Relief and Labor Law: What Has Changed and What Remains?
- EU AI Regulation: Strategic Turning Point for Companies
- Profion Introduces New Reinsurance Model To Strengthen the Retirement Phase
- Company Pension Strengthening Act II Increases Attractiveness of Employer-Sponsored Pensionsg
Mandatory Time Tracking and Weekly Maximum Working Hours – Update 2025: What is the current situation in Germany?
Following the “time clock” ruling of September 13, 2022, employers in Germany are required to record the entire working time of their employees. This aims to protect employees’ health and reduce overtime.
According to the April 2025 coalition agreement, the obligation to electronically record working hours will be implemented in an unbureaucratic manner. Small and medium-sized enterprises (SMEs) will benefit from appropriate transitional rules.
In addition, the coalition agreement provides for maintaining the average maximum weekly working time of 48 hours, but relaxing the current maximum daily working time limit of eight hours. This change is intended to improve work-life balance, but must be done in consultation with social partners (i.e., trade unions and employer associations).
Furthermore, trust-based working time without formal time tracking will remain possible under the EU Working Time Directive, although trust-based working hours are not regulated by law.
Conclusion: Greater flexibility does not mean fewer obligations. Transparent time tracking remains essential. Companies should adapt to the new legal situation and determine how they will implement it within the framework of appropriate internal guidelines and procedures.
Claudia Duggal
Bureaucracy Relief and Labor Law: What Has Changed and What Remains?
As of January 1, 2025, the Fourth Bureaucracy Relief Act (BEG IV) has come into effect, easing numerous previously strict formal requirements in labor law.
Most important change: Many documents are now valid in text form (e.g., via email or PDF), provided they can be saved and printed. A handwritten signature is no longer required.
Where text form is now valid:
- Permanent employment contracts and contract amendments
- Temporary employment contracts
- Applications for parental leave, care leave, and part-time work, as well as approvals and rejections, can be submitted and responded to in text form since May 1, 2025.
- Employment references and interim references may be issued electronically—provided the employee consents and, if necessary, a qualified electronic signature is used.
- Laws that must be posted in the workplace may now be provided digitally.
Where written form is still required:
- Terminations
- Termination agreements
- Fixed-term employment contracts (§ 14 para. 4 TzBfG)
- Post-contractual non-compete clauses (§ 74 HGB)
- Certain industries (e.g., construction, hospitality) due to the Unlawful Employment Act
We are happy to support you in making the necessary adjustments so you can benefit from the new flexibility without compromising legal certainty.
Iris Zank
EU AI Regulation: Strategic Turning Point for Companies
With the EU AI Regulation (EU AI Act) coming into force on August 1, 2024, the use of AI in companies was given a uniform legal framework for the first time. The aim of the regulation is to enable innovation while minimizing risks. For companies, this means that AI is becoming a key governance and compliance issue.
Since February 2025, practices such as social scoring, manipulative systems, indiscriminate facial scraping, and emotion recognition in the workplace are prohibited. As of August 2025, new rules apply to general-purpose AI models, and from August 2026, comprehensive requirements will follow for so-called high-risk applications.
Especially relevant for management: Many HR systems—such as those used for recruiting, performance evaluations, or promotion decisions—fall under the high-risk category. These are subject to strict requirements for risk management, data quality, documentation, and human oversight. Violations can result in fines of up to €35 million or 7% of global annual revenue.
Now is the right time to review your company-wide AI strategy. This includes inventorying existing tools, clearly assigning responsibilities at the executive level, and involving vendors early on. Companies that act proactively not only ensure compliance but also strengthen trust and long-term competitiveness.
Alice Brem
Profion Introduces New Reinsurance Model to Strengthen the Retirement Phase
Market demands on occupational pensions are rising, especially regarding the strengthening of the retirement phase.
Leading institutions in the field of occupational pensions have long pointed to the growing gap in the state pension system and the resulting challenge for company pensions. According to these institutions, this can be addressed through increased focus on the capital market, which means moving away from traditional pension models.
In collaboration with Munich Re PCC, Profion has developed an alternative reinsurance model for the retirement payout phase, based on a strong capital market orientation:
Aligning with the capital market implies greater volatility at the start of retirement, which can positively impact the initial pension amount.
Our service includes reviewing each upcoming pension using this alternative model. This allows us to optimize outcomes for our clients based on the current capital market situation and the expected pension amount.
In our investment strategy, we rely on the expertise and financial strength of Munich Re, the world’s leading reinsurance company and institutional investor, which uses the same investment mix for its own employee pension plans in Germany.
Read the full press release (German) on this innovative reinsurance solution
* IFA (Institute for Retirement Provision), DAV (German Actuarial Association), IVS (Institute of Actuarial Experts)
Norbert Rutzmoser
Sören Schulze
Company Pension Strengthening Act II Increases Attractiveness of Employer-Sponsored Pensions
With the adoption of the Company Pension Strengthening Act II, the attractiveness and efficiency of occupational pensions are increasing. In future, it will be possible to receive statutory and occupational pensions in parallel while continuing to work, small pension entitlements can be settled more easily, and support options for low-income earners will be improved. In addition, simplified option systems can be introduced that allow automatic deferred compensation if the employee does not explicitly object.
In view of the upcoming reform of the statutory pension system, an expansion of occupational pension schemes is also urgently recommended. Although the current pension package is intended to extend the freeze until July 31, 2031, meaning that the pension level for a so-called standard pensioner should not fall below 48% until that date, demographic trends suggest that maintaining this level beyond 2031 will not be financially viable. This reduction could be compensated for by supplementing it with a company pension scheme.
Dr. Torsten Reich
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