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Werkvertrag: definition and distinction

A Werkvertrag owes a result, not labor. This entry explains the features, how it differs from staff leasing and the risks.

Key facts
  • The legal basis is §§ 631 ff. of the German Civil Code (BGB).
  • What is owed is a result (the work), not labor.
  • The contractor works on their own responsibility and free of instructions.
  • Paid as a fee on acceptance (interim payments under § 632a BGB).

Definition and classification

A A Werkvertrag under §§ 631 ff. BGB exists where one company commissions another company or a self-employed person to produce a work: the contractor undertakes to produce it, the client to pay the fee. The client sets a goal, but the execution is directed by the company commissioned. The producer acts as an independent business and decides on equipment, people and time – and carries full liability for a defect-free end result. What is bought in is not staff but an outcome: a serviced installation, a completed works package, a finished project. The contractor organizes themselves, deploys their own people and carries the risk of delivering the result.

Typical uses are construction and repair work, transport services, skilled trades, and expert opinions and plans.

How is the fee calculated and when is it due?

The client pays the fee but is only invoiced for the end result – not for workers or working time. The company commissioned works up front, since payment only follows on acceptance of the work; under § 632a BGB interim payments for parts already delivered are possible. Billing is often by unit prices , that is a fixed price per unit of work (for example per piece or per kilogram); less often by time spent or a lump sum. The calculation is based on the collectively agreed wages of the contractor's employees, the estimated time per unit, material and general business costs, and a margin for risk and profit. If the producer takes longer than expected, the unit price is unaffected.

What does a Werkvertrag have to contain?

A solid Werkvertrag contains a detailed description of the work or the task, the delivery date and form, fee and payment arrangements (ideally with a clause on late or missing payment), clear acceptance conditions, where relevant usage arrangements for the work produced, and termination clauses for both client and contractor.

How does a Werkvertrag differ from staff leasing?

The decisive factor is the employment-law right to direct – that is, who may give the worker instructions. Under a Werkvertrag the company that actually employs the person keeps the authority to instruct; the employees are paid by the contractor. Under Staff Leasing the temporary worker is employed and paid by the staffing provider but receives instructions from the hirer. From a Service contract the Werkvertrag differs by the result owed rather than mere activity.

What are the risks?

If a Werkvertrag exists only on paper and the people are in fact integrated and directed by the client, that is concealed staff leasing – with the consequences of §§ 9, 10 AÜG. The compliance records of the Subcontractor deployed should therefore be checked continuously.

Where subcontractors are used, client liability also applies: the client company is jointly liable for minimum wage and social security contributions along the subcontractor chain – including for breaches it knew nothing about. If the customs authority audits and a subcontractor has not paid correctly, in the end only one thing counts: whether it can be proven that the monitoring obligations were met.

This is exactly where subcontractor compliance from Pactos comes in: legally sound management of every record in one place, automatic document requests for missing and expiring paperwork, and live compliance scores that show at any time how completely each subcontractor is set up.

Frequently asked questions

When does the fee fall due?

In principle on acceptance of the defect-free work. For parts already delivered, interim payments are possible under § 632a BGB or under the contract.

Does the client pay the workers under a Werkvertrag?

No. Under a Werkvertrag only the end result is paid for; the employees are paid by the contractor. Under staff leasing, by contrast, the staffing provider pays the employee.

What happens if the producer takes longer than planned?

Where billing is by unit prices, the actual duration is irrelevant to the fee – the risk lies with the contractor, not the client.

When does a Werkvertrag become a legal risk?

When the people deployed are in fact integrated and bound by the client's instructions – then disguised staff leasing looms, with the consequences of §§ 9, 10 AÜG.

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