Germany: draft law for €12 minimum wage tabled

An increase in Germany’s minimum wage to €12 per hour – a central campaign pledge of the new chancellor Olaf Scholz – appears to be in the offing, as it is the first draft law to be tabled by Hubertus Heil in his new term as labour and social affairs minister. Introduced seven years ago at a level of €8.50 per hour, the German minimum wage is set on a regular basis by a federal commission. On 1 January 2022, the minimum wage increased to €9.82. Under the draft law that has been tabled, there will be an acceleration in the growth of the minimum wage, which will rise to €10.45 on 1 July and reach €12 on 1 October 2022. The next increase, scheduled for 1 January 2024, will again be set by the federal commission. This increase will directly affect 6.2 million employees, primarily women and people in the eastern Länder, the labour and social affairs minister explained. For employers, the ministry calculated an additional burden of €1.63 billion. One point remains unclear for the time being. In principle, the government agreement signed by the three coalition parties provides that millions of so-called “mini jobbers” (maximum of 15 hours/week for €450/month) will also be able to benefit from the scheme without their number of working hours being reduced. However, for this to be possible, the legal ceiling of €450 per month must be increased. The business organisations of sectors employing many mini jobbers (such as hotels, restauration and industrial cleaning) are therefore urgently requesting a correction to the bill.