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New equal pay agreements will increase costs for recruitment firms in Germany and the staffing industry is to face “major” challenges in the future, a new survey by the German chamber of commerce (IHK) shows.
Prospects in the coming months have worsened. “Apart from the lacklustre economic performance, the surcharges of collective agreements have contributed to this development,” said Volker Giersch of the IHK.
The study has identified these latest bargaining agreements as a major risk for staffing firms and the industry in general.
In the metal/electrical and chemical industry, for instance, temporary agency workers will now receive a surcharge of 15% on top of the base pay after working in one company for six weeks. This will continuously rise and eventually reach 50% after a nine-month period of employment in one company.
“Further regulations, such as an obligation to take over temporary staff on a permanent basis or a strict limit on the duration of assignments, must not happen. This would poison the industry and would have a negative impact on the labour market, also affecting other sectors,” Mr Giersch said.
He warned that staffing firms are to face more challenges in the future. “For many small and medium-sized companies this raises the question of survival,” Mr Giersch warned.