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A Secondment Agreement lets one company temporarily transfer an employee to work at another organization while keeping their original employment contract active. Under German labor law, this arrangement maintains the worker's rights and benefits with their primary employer while they gain experience or provide expertise elsewhere.

These agreements spell out key details like duration, work duties, and which company handles day-to-day management. They're particularly common in the German Mittelstand when sharing specialized talent between partner firms, or when multinational companies need to move staff between locations. The agreement must comply with the German Employee Lending Act (Arbeitnehmerüberlassungsgesetz) and outline clear responsibilities for workplace safety, confidentiality, and professional liability.

Use a Secondment Agreement when your company needs to temporarily share skilled employees with another organization while protecting everyone's interests. This works especially well for German companies looking to provide specialized expertise to clients, develop talent through cross-company experience, or manage temporary staffing needs during large projects.

The agreement becomes essential when sending staff to work at partner companies, subsidiaries, or client sites for periods longer than typical business travel. Under German labor law, it helps navigate complex requirements around employee lending, maintains clear reporting structures, and ensures compliance with workplace regulations. It's particularly valuable for technical specialists, project managers, and consultants who need to work on-site while retaining their original employment benefits.

• Internal Secondments: Used when transferring employees between departments or subsidiaries within the same German corporate group. These focus on maintaining existing benefits and internal reporting structures.
• Client Project Secondments: Common in consulting and IT sectors, these arrangements detail specific project deliverables and client site working conditions while protecting intellectual property rights.
• International Secondments: Designed for cross-border assignments within the EU, addressing visa requirements, tax implications, and compliance with both German and host country labor laws.
• Training Secondments: Structured for skill development and knowledge transfer, often used in technical industries with clear learning objectives and mentorship provisions.

• Home Company (Primary Employer): Maintains the original employment contract, continues paying salary and benefits, and remains legally responsible for the employee under German labor law.
• Host Organization: Provides day-to-day work direction, ensures proper working conditions, and benefits from the seconded employee's expertise.
• Seconded Employee: Works at the host organization while retaining employment rights with their original employer, following both companies' policies.
• Legal Departments: Draft and review agreements to ensure compliance with German employment laws, particularly the Employee Lending Act.
• Works Council (Betriebsrat): Must be consulted and approve secondment arrangements affecting German workforce conditions.

• Basic Details: Gather employee information, duration of secondment, and both companies' registration details under German law.
• Work Specifics: Define role responsibilities, reporting structure, work location, and any special project requirements.
• Compensation Structure: Document salary arrangements, benefits continuation, expense policies, and any additional allowances.
• Legal Compliance: Confirm alignment with German Employee Lending Act requirements and obtain Works Council approval if needed.
• Working Conditions: Specify working hours, leave policies, health and safety measures at the host company.
• Termination Terms: Include clear conditions for ending the secondment early and return procedures to the home company.

• Party Details: Full legal names and addresses of home company, host company, and seconded employee.
• Duration Clause: Specific start and end dates, plus conditions for extension or early termination.
• Work Arrangements: Detailed description of role, responsibilities, reporting lines, and work location.
• Employment Status: Confirmation of continued employment with home company under German labor law.
• Compensation Structure: Salary continuation, benefits, expenses, and any additional allowances.
• Data Protection: GDPR compliance measures and data handling between both organizations.
• Confidentiality: Protection of business secrets and intellectual property for both companies.
• Governing Law: Explicit reference to German law and jurisdiction.

A Secondment Agreement differs significantly from an Agency Agreement in several key aspects, though both involve one party working on behalf of another. Let's explore the main differences to help you choose the right document for your situation.

• Employment Status: In a secondment, the employee maintains their original employment contract and benefits, while an agency relationship creates an independent business relationship without employment ties.
• Control and Management: Seconded employees work under the host company's daily supervision while maintaining their primary employer, whereas agents operate independently with more autonomy.
• Legal Framework: Secondments fall under German labor law and the Employee Lending Act, while agency agreements are governed by commercial law and the German Civil Code (BGB).
• Duration and Purpose: Secondments are typically temporary arrangements for specific projects or skill sharing, while agency agreements often establish ongoing business relationships for market representation or sales.