A clear majority of German companies pay their employees inflation compensation. According to a study by the ifo Institute, it is almost three quarters. More want to follow.
According to a survey, almost three quarters of German companies have already paid their employees tax- and duty-free inflation compensation. This was stated by 72 percent of HR managers, according to the Munich ifo Institute’s survey. Another 16 percent plan to pay out this bonus soon.
“The reason for paying out this bonus is, above all, a higher level of motivation among your employees,” said ifo expert Daria Schaller. In 27 percent, the payment is also part of a collective agreement. Only twelve percent of those surveyed did not want to pay out a bonus.
Up to 3,000 euros tax and duty free
Since October 26, 2022, the inflation compensation bonus has allowed employers to grant their employees an amount of up to 3,000 euros tax- and duty-free. The federal government set this as part of the third relief package in view of increased energy prices.
As the size of the company increases, the willingness to pay an inflation compensation bonus increases: 93 percent of companies with 500 or more employees and 84 percent of smaller companies grant it. At 93 percent, industrial companies pay (completed or planned) more often than companies in retail (86 percent) and service providers (85 percent).
Premiums can still be paid until the end of the year
71 percent of the HR managers surveyed see the bonus as an additional opportunity to motivate employees. A good half (56 percent) take advantage of the tax advantage. 49 percent cite their competitiveness in the labor market as the reason. “Small companies primarily focus on the motivation of their workforce, while large companies pay more often when a collective agreement is concluded,” said ifo expert Schaller.
The possibility of paying out this bonus is valid until the end of 2024. This is a voluntary service. In some collective agreements, the bonus was also decided to be generally binding.