Employers view the planned procedure more critically than the level of wages.
(Photo: dpa)
Berlin In view of the planned increase in the minimum wage to twelve euros, the employers accuse the federal government of a “misunderstanding of the social market economy, the role of the social partners and the question of an appropriate wage”. This is what the statement by the Confederation of German Employers’ Associations (BDA) on the draft bill from Labor Minister Hubertus Heil (SPD) says.
In the justification for the law, appropriate participation in social life based on the Anglo-Saxon system of “living wages” is listed as the reason for the increase. However, the employers criticized that this does not fit into the German system of functioning wage determination by the collective bargaining parties.
With the “state wages”, the federal government is not only “disrespectful” towards the decisions of the independent minimum wage commission, which has done a good job, according to circles of the employers’ associations. The increase also hit companies in a difficult crisis situation. The BDA is currently having a labor lawyer and a constitutional lawyer draw up a legal opinion on the planned law, which should be available in two weeks.
According to the draft bill, the minimum wage, which is currently EUR 9.82 gross per hour and will rise to EUR 10.45 on July 1, is to be raised to EUR 12 from October.
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After that, the independent Minimum Wage Commission, made up of employer and employee representatives, should take over again and decide by the end of June 2023 on the next adjustment from January 1, 2024.
While employers doubt that the political intervention – as promised by the government – will remain “one off”, the German Trade Union Confederation (DGB) emphasizes that the meaning and importance of the minimum wage commission remain anchored in the law. After the planned increase, the Commission will “continue its work in the usual way and remain the responsible body for the further development of the minimum wage”.
The role of the minimum wage in poverty reduction is controversial
According to the statement, the DGB and its member unions expressly welcome the one-off statutory increase in the minimum wage. A full-time employee has, compared to a minimum wage of 10.45 euros, 250 euros gross more in his pocket at the end of the month. This is an important step towards the actual goal of the lower wage limit – the avoidance of poverty.
Here, however, the opinions of employers and trade unions differ. Securing the subsistence level is a core task of the state and should not be imposed on the social partners and companies, writes the BDA. The chairman of the minimum wage commission, the former RWE labor director Jan Zilius, has repeatedly emphasized that he does not consider the statutory lower wage limit to be a suitable tool for combating poverty.
Employers are demanding that they wait at least until the beginning of 2023 before raising the minimum wage in order to give companies time to adapt and to allow the increase to EUR 10.45 decided by the Minimum Wage Commission to take effect. Also, the lower wage limit changed by the law should not be adjusted again in 2024, but only in 2025.
>> Read here: These are the four consequences of the largest salary increase in German history
The employers argue that there was a longer lead time for companies when the minimum wage was introduced in 2015 and that the lower wage limit of EUR 8.50 at the time was not touched again for two years. In addition, a transitional regulation for existing collective agreements is required. According to the Federal Statistical Office, the increase to twelve euros will interfere with at least 125 collective agreements.
According to Gregor Thüsing, Director of the Institute for Labor Law and Social Security Law at the University of Bonn, proposals were already on the table when the Minimum Wage Act was created to allow collective agreements to take precedence. That was rejected at the time. “It is now all the more clear that this lack of trust in the collective bargaining partners leads to problems.”
More: BDA boss Dulger: “Breaking the minimum wage has destroyed a lot of trust”