Criminal law for employers
Several criminal regulations apply exclusively to employers.
In this respect particularly the liability of employers to pay social security contributions and taxes takes centre stage. In addition, there are other liabilities related to social security legislation, some of them punishable.
The most memorable example for criminal offences in this field are so-called cash-in-hand jobs, that is the employment of labour by willingly withholding social security and tax payments. These charges are often accompanied by significant claims by revenue authorities and social insurance bodies. In addition, there are precautionary procedural measures such as arrest during investigation proceedings. The court can order the confiscation of proceeds of crime. This is also applied to businesses.
Criminal defence in the area of criminal law for employers requires particular attention. Above all, social security law and (criminal) tax law are to be considered. We defend you comprehensively against all charges brought against you in this context. For this purpose, we work closely with experts in social security law and tax law – especially in cases that involve special matters, for example the law on hiring out employees. We bring the assumptions of the investigation authorities into question, especially when they form the basis of the identification and estimation of damage.
Section 266a Criminal Code: Withholding wages and salaries
The employer is obliged to pay employee social security contributions to the respective authorities. It constitutes a criminal offence under section 266a par. 1 Criminal Code if the employer violates this obligation. Even the partial infringement of these obligations is actionable. Strict standards are applied in these cases. In general, even late payments are grounds for culpability.
This provision serves to protect the contributions of the social security carriers and is thus strictly enforced.
For instance, charges under section 266a Criminal Code are brought against an employer if there is the suspicion that this employer has employed labour without being registered on a large scale. The approach of the investigation authorities is in these cases often based on estimates. It is particularly problematic that the basis of these estimations often remains in the dark or are based on mere assumptions. Above all, these estimations must not result in failure to clarify the case even if this endeavour is cumbersome. It is unlawful to fall back on overinflated estimations.
Allegations under section 266a Criminal Code are also often made in the context of company insolvencies. The late or non-payment of social security contributions frequently occurs when companies are in crisis. If a company was no longer able to make due payments, liability is excluded according to section 266a Criminal Code.
Liability of so-called cash-in-hand jobs
These offences are punishable both under section 266a Criminal Code and under section 370 AO on grounds of tax evasion because no tax on wages actually paid has been submitted.
In practice, it is often difficult to identify the precise amount of wages paid for ‘cash-in-hand’ jobs. These payments are often made far apart in time and are for obvious reasons rarely documented. The investigation authorities usually try to determine paid wages based on incoming payments and estimations of the work required. Such an approach is naturally prone to error.
As the term indicates, cash-in-hand jobs are paid in cash. This results in further problems related to criminal tax law, particularly when fictitious invoices are used to disguise the cash payments.
Liability for accidents in the workplace
Negligent physical injury or death can also be due to organizational fault. This can be presumed if health and safety as well as workplace regulations have not been complied with. In any case, however, actual and legal liabilities must be established. As a matter of course, senior staff members cannot personally supervise the compliance with all applicable regulations. Effectively delegating the respective tasks to subordinate employees is perfectly allowable. In this case, liability can only result from fault in selecting a third party.
De facto manager
We are criminal lawyers
We analyse the charges brought against you and develop solutions for your case. For this purpose, we can draw on decades-long specialized experiences, which allows us to achieve the optimal outcome. Of course we pay particular attention to various possibilities of proceedings being dismissed according to the Code of Criminal Procedure.