In 2019, there will be a number of changes to several areas of German labour law. In addition to changes to the right of termination, to bargaining unit law and to the law on fixed-term contracts, as well as changes to the rules governing temporary part-time work and the Training Opportunities Act, an increase in the minimum wage and the introduction of a new corporate immigration law are expected. Some of these changes are coming into force following lengthy debate and negotiations and are now being recognised through their embodiment in law. The most relevant changes for 2019 are listed and presented below.
- Temporary part-time
On 18 October 2018, the German Bundestag adopted an Act on the Further Development of the Law of Part-Time Work, and established a legal entitlement to temporary part-time employment in connection with this. This regulation came into force on 01 January 2019. With these changes, the legislator is seeking to make employee free to choose when they take up full-time employment again after a period of part-time employment. The regulation is subject to certain conditions. (see: https://www.globaladvocaten.com/blog/labour-law-parttime-work-in-germany)
- Changes to the regulations on the right of termination
- According to a 25a (5a) of the draft bill of the German Banking Act (KWG-RefE) tabled by the Federal Ministry of Finance, it will be possible to terminate employment relationships between risk bearers of financial institutions and financial institutions without stating reasons. According to the future Section 1 (21) KWG-RefE, “risk bearers” are persons whose activities have a material effect on the risk profile of an institution. The regulation is limited to those risk bearers, “who are non-executive employees […][,] […] receive an annual salary of currently at least 234,000 euros – West[Germany] – or 208,000 euros – East[ Germany] – (from 2019: 241,200 euros – West[Germany] – /221,400 euros – East[Germany] -) [and hence receive a salary of at least three times the assessment ceiling in the general pension insurance] “(see press release Federal Ministry of the Finance dated 19.12.2018).
- Section 622 (2) sentence 2 German Civil Code (BGB) will be repealed with effect from 01.01.2019. The European Court of Justice had declared the standard to be contrary to EU law (ECJ, case C-555/07 (Kücükdeveci)). The standard violates the prohibition of discrimination.
- Increase in the statutory minimum wage
From 01.01.2019, the minimum wage in Germany will be increased to EUR 9.19 gross per hour (see press release of the Federal Government from 20.11.2018).
- Amendment of the bargaining unit law
In its judgement of 11.07.2017 (1 BvR 1571/15, 1 BvR 1043/16, 1 BvR 2883/15, 1 BvR 1588/15), the Federal Constitutional Court called upon the legislator to the amend the Transparency in Wage Structures Act (Entgelttransparenzgesetz). The law regulates conflicts in the collective bargaining agreements of several trade unions. In the event of a conflict, priority is to be given the collective bargaining agreement of the trade union with more members. The law excluded individual occupational groups or sectors. This was declared unconstitutional by the Federal Constitutional Court, which also declared the law to be unconstitutional as a result. This has been taken up by the German legislator and a new regulation has been drafted, which came into force on 1 January 2019.
- Federal Cabinet passes corporate immigration law
On 19.12.2018, the Federal Cabinet passed the corporate immigration law. The bill “will selectively relax and standardise the regulations governing the residence and immigration of skilled workers from third-countries, rendering them clearer and more transparent overall” (see press release Federal Ministry of the Interior, Building and Community dated 27.11 .2018). How the legislative procedure progresses remains to be seen.
- Changes to the law on fixed-term contracts
In their coalition agreement, the members of Germany’s newly formed coalition between CDU, CSU and SPD, have agreed on a change to the law on fixed-term contracts: (see https://www.cdu.de/system/tdf/media/dokumente/koalitionsvertrag_2018.pdf?file=1). At the moment there are no corresponding draft laws.
- Training Opportunities Act
“In future, all employees are to be given access to support for further education, irrespective of their qualifications, age and the size of the company” (see press release of the Federal Ministry of Labour and Social Affairs dated 1 January 2019). To date, the relevant funding programmes were limited to workers without any prior vocational qualification. In light of the steady replacement of manpower with new technologies, the new regulation seeks to further qualify the redundant labour force for the labour market or make it possible for them to gain a qualification.