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Germany – Employers warn of increased costs for temporary workers

16 October 2012

Employers have warned about increased costs in the temporary staffing industry as collective agreements are raising pay rates for agency workers from November. This could also cost the industry many jobs, particularly in the low-skilled sectors where most agency workers are employed.

Collective bargaining agreements are due to come into force in a couple of weeks, giving temporary workers higher pay if they are working in a company for more than six weeks.

This could have a detrimental effect on low-skilled jobs. “We will soon see how many companies will say that this is getting too expensive and expand their foreign productions [instead],” said Volker Fasbender of the Confederation of German Employers' Associations (BDA) about the new bargaining agreements.

Although he said that the higher pay rates are favourable, he believes that unions “want more.” According to him, this could deeply impact agency workers. “Around 30% of the 800,000 temporary workers have low qualifications and used to be in long-term unemployment.”

He argued that, if temporary employment is getting too pricey, companies might move business activities abroad or replace work mechanically. 

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