Remuneration of foreign works council members

At a time when Germany is desperately seeking highly qualified talent from abroad, many international professionals view the German model of employee participation with a mixture of admiration and skepticism . It is a system that promises stability, yet behind the scenes in executive suites and works council offices, a highly complex conflict often simmers. While the federal government is pushing ahead with the digitalization of public administration and lowering the barriers to immigration for experts, the inner workings of German companies often remain trapped in rigid, sometimes contradictory, legal frameworks. This is particularly evident in the question of how those who advocate for the interests of their colleagues may be compensated. A single mistake in the payroll of a works council member can have serious consequences under labor law.

The principle of voluntary work as an uncompromising standard

In our daily legal practice, we observe that the principle of voluntary service on the works council is particularly difficult to grasp for specialists and managers who were not socialized in Germany. According to Section 37 Paragraph 1 of the Works Constitution Act (BetrVG), serving on the works council is a voluntary position . Essentially, this means that one must neither become richer nor poorer as a result of holding this office. This principle is reinforced by the prohibition of discrimination and preferential treatment stipulated in Section 78 Sentence 2 of the Works Constitution Act . We see this as creating a significant tension for modern companies that favor agile structures and individual incentive systems. Instead, case law requires a strict hypothetical scenario: How would the employee's career have developed if they had not been elected to the works council? This "hypothetical career development" is the only permissible benchmark for salary increases or additional benefits. Remuneration exceeding what comparable employees without a mandate receive is void under Section 134 of the German Civil Code (BGB) and would theoretically even require the employer to reclaim the overpaid amounts – not to mention the criminal risks of breach of trust.

Company cars are the focus of legal proceedings.

A particularly vivid example of this balancing act is the provision of a company car for private use. For many highly qualified employees, the vehicle is a standard component of their compensation package. However, different rules apply to works council members, as the Lower Saxony Regional Labor Court recently emphasized in its ruling of November 3, 2025 (Case No. 15 SLa 418/25) . The case involved a works council member who, through internal additional training, worked as a social advisor and received a company car for this purpose. When this role ended, she continued to demand the car – and failed miserably. The court clarified that the private use of a vehicle constitutes an impermissible preferential treatment if there is no contractual entitlement or if comparable employees in the individual's original position do not receive a car. The protection afforded to works council members must never lead to privileges based solely on their function within the body. We often criticize the lack of flexibility in the law, which makes it difficult to adequately recognize special commitment within the works council, but we must point out that the case law does not allow any exceptions here.

The fictional career as a saving grace or a stumbling block

To ensure legally compliant compensation, companies must establish so-called comparison groups. In today's increasingly individualized workplace, this is a monumental task. Simply adjusting salaries "by feel" is insufficient. The law firm therefore strongly advises precisely documenting hypothetical career paths to comply with the requirements of Section 37 Paragraph 4 of the German Works Constitution Act (BetrVG ). If a works council member claims they would now be a department head were it not for their position, this must be substantiated using objective criteria and the development of colleagues with similar starting profiles. For foreign investors or expats in management positions, this bureaucratic hurdle often seems like a relic of the past, but it is the only safeguard against accusations of corruption or embezzlement within the company. Digitizing HR administration could help create objective data models for comparability, but the ultimate legal responsibility remains a case-by-case review by both human and legal professionals.

Conclusion: Compliance is paramount.

In summary, the ruling of the Lower Saxony Regional Labor Court (LAG Niedersachsen) serves as a clear warning to all employers: Well-intentioned benefits such as a company car can have disastrous legal consequences if they are not meticulously examined for compliance with the principle of comparability. The principle of voluntary service remains the inviolable core of German works constitution law. Any deviation from the remuneration of comparable employees without such a mandate is a potential criminal risk. This may seem rigid to highly qualified immigrants and modern companies, but legal certainty takes precedence over individual rewards for commitment.

How we, as a law firm, can help you with Visaguard

As a specialized law firm at the intersection of employment and immigration law, we support you in navigating these complex regulatory hurdles with confidence. We advise companies on creating legally compliant compensation matrices for works council members and assist with the legally sound documentation of hypothetical career paths. Especially for international companies less familiar with the intricacies of the German Works Constitution Act, we offer the necessary security to prevent compliance violations and criminal risks from the outset. Rely on our expertise to ensure your skilled workforce is managed optimally in accordance with German law.

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