Hiring freelancers: legally classify their status

Why the status should be clarified before you start

If you engage a freelancer, you should clarify their social-security status before the work begins. If it later turns out that the arrangement was in fact dependent employment, back payments of social-security contributions may be due – retroactively for up to four years, and in cases of intent even up to 30 years. The engaging company is liable for the full contributions (both employer and employee shares). What matters is not the wording of the contract, but the actual practice of the collaboration.

Which criteria matter?

The German Pension Insurance (DRV) and the social courts assess the status through an overall evaluation. Three criteria are central:

• Subordination to instructions: Does the client determine the time, place and content of the work in detail?
• Integration into the work organisation: Is the person firmly embedded in the client's teams, processes and resources?
• Entrepreneurial risk: Does the person carry their own economic risk, appear on the market under their own name and work for several clients?

The stronger the instruction and integration, and the lower the entrepreneurial risk, the more the overall picture points to dependent employment.

Recognising warning signs

Typical warning signs include fixed working hours, permanent use of the client's equipment, working for only one client, fixed monthly pay, and an open-ended, close collaboration. You can find a detailed list in our [checklist for companies](/ratgeber/scheinselbstaendigkeit-pruefen-checkliste-unternehmen).

Status determination by the DRV

A legally binding determination is made exclusively by the German Pension Insurance in the status determination procedure under § 7a SGB IV. The application can also be filed before the activity begins. The procedure provides a binding clarification but can take several months.

How Jowomo helps

With Jowomo you classify the self-employment status of a freelancer engagement in two steps:

• Free short orientation: eight details are enough and you receive an instant summary – no account required.
• Optional lawyer-reviewed assessment: for a one-time €199 (plus 19% VAT) per case, delivered within 24 hours after payment and complete information.

Jowomo is not legal advice and does not replace a DRV status determination procedure. [Start for free now](/unternehmen/check)

Frequently asked questions

Is the assessment legal advice?

No. The assessment is oriented along the usual criteria (incl. DRV practice) but is not individual legal advice for a specific case.

Does Jowomo replace the status determination procedure?

No. A legally binding determination is made solely by the DRV under § 7a SGB IV.