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Germany — Minister promises new law against 'perm to temp' abuses

20 May 2010

In a speech at the Federal Congress of German Unions (DGB Bundeskongress) the Minister for Labour and Social Affairs, Ursula von der Leyen, said yesterday that she will no longer tolerate the systematic abuse of temporary employment law where companies like drugstore chain Schlecker sack large numbers of permanent employees only to re-employ them again as temporary employees on much reduced pay via in-house temporary employment agencies.

Von der Leyen told Delegates "I can give you my assurance today that we will put legislation in place to prevent the 'revolving door' practice in the future. Permanent employees will no longer be [systematically] replaced with temporary employees."

At the same time von der Leyen made the point that temporary employment as such does not constitute a problem for her. She merely condemns abusive practices of temporary employment law.

The Minister also came out in favour of a minimum salary* for the temporary employment sector in order to prevent temporary employment agencies located in Eastern European Union (EU) countries from wage dumping at hourly rates of between 3 and 4 Euro when the EU labour market opens up in May 2011.

*Germany does not have a minimum salary as such. Minimum salaries are negotiated sector by sector via collective bargaining between unions and employer associations. 95% of the 650,000 temporary employees are now covered by recently negotiated minimum salary agreements but these will only apply to temporary employees from outside of Germany if the government declares the agreements as 'nationally binding' (allgemeinverbindlich).

To see a non-exhaustive list of in-house temporary employment agencies in German language please click here



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