BDO Warns Sports Clubs About Risks of Misclassifying Trainers and Course Instructors

BDO AG Wirtschaftsprüfungsgesellschaft has issued a statement warning sports clubs and other organizations about the increasing risks associated with classifying trainers and course instructors as independent contractors. The Federal Social Court's (BSG) jurisprudence and the transitional provision in § 127 of the Social Security Code (SGB IV) have significantly raised the stakes.

The BSG's "Herrenberg judgment" from June 2022 clarified that no special rules apply to teachers in constitutionally protected artistic fields. Instead, the court emphasized general criteria for distinguishing between independent activity and dependent employment. Key factors include the obligation for personal performance, adherence to the client's instructions, integration into the client's organizational structure, bearing entrepreneurial risk, and freedom regarding the location, time, and content of work.

BDO states that these principles are directly applicable to trainers and course instructors in sports. If training times are dictated, club facilities are used, club attire is worn, or participants are assigned by the club, it strongly suggests integration into the club's operations, thus indicating a dependent employment relationship. A simple contract for services does not protect against classification as social security-liable employment.

The consequences of such a classification can be severe. During an audit, the German pension insurance provider may retroactively demand comprehensive social security contributions for several years. Additionally, late payment penalties and potential tax implications may arise. In response to the stricter case law, the legislator introduced § 127 SGB IV, effective March 1, 2025, establishing a temporary transitional rule for certain teaching activities. This provides educational institutions and other entities collaborating with teachers an opportunity to adapt their organizational and business models. This transitional period has now been extended until the end of 2027.

BDO emphasizes that the regulation does not alter the fundamental assessment of status. The question of whether an individual is self-employed or an employee must still be answered according to the strict BSG criteria. The firm advises that management of sports clubs should pay particular attention to this issue, as many clubs traditionally rely heavily on contract workers.