Coalition agreement before implementation: The minister gives, the minister takes

When the coalition committee discussed growth impulses at the beginning of July, Alexander Schweitzer (SPD) was not yet at the table. At that time, the current Federal Minister of Labor was still a state politician in Rhineland-Palatinate. Bärbel Bas's successor is now setting about implementing the agreements from the summer without hesitation: his ministry sent a draft law on changes to labor law agreed at the time to be coordinated with the other departments on Tuesday.

The most far-reaching point in the draft, which was first reported by the Süddeutsche Zeitung and which is available to the taz: employment contracts may be limited for longer than before without there being a so-called factual reason (such as replacing sick employees). To date, a contract can usually be limited to a maximum of two years and can be extended a maximum of three times during this time. In the event of violations, employees can sue for a permanent contract.

In the future, these limits are to be doubled: fixed-term contracts will then be allowed for up to four years with up to six extensions.

This particularly affects young professionals and working pensioners: According to a study by the Hans Böckler Foundation, around half of all newly hired employees under the age of 25 and over 65 initially receive a fixed-term contract. Across all age groups, the rate is still around 38 percent.

The Ministry of Labor justifies the change, as the coalition committee did in the summer, with the economic situation: companies are currently hesitant to hire new employees, according to the draft law. The new regulation “at best opens up further employment opportunities”. It should also help the affected employees themselves. In the hope of better economic times, the change itself is temporary: it should only apply to new hires until the end of 2030.

Elsewhere in the legislative package, however, employee rights are being expanded. This is about co-determination in companies. In principle, the workforce of companies with over 500 employees is entitled to one third of the seats on the supervisory board. If you have 2,000 employees, it's even half that. According to the ministry, this obligation is sometimes avoided in cases where a company operates as a European stock corporation (SE) and not as an AG or GmbH.

There are also rules for SEs: when they are founded, employees and employers must negotiate co-determination. However, there is a regulatory gap in the event that an SE is founded without employees and only hires staff later.

The result, according to the ministry: Five out of six large SEs have no equal co-determination, and at least 480,000 employees are affected. The draft law provides for stronger measures against abuse and the possibility of subsequent negotiations in the future.

The bottom line is that there is still criticism of Schweitzer's package from the opposition. “As much as I think it is right to strengthen corporate co-determination, it would be wrong to link it to an expansion of unfounded fixed-term contracts,” said Ricarda Lang, responsible for labor policy in the Green parliamentary group, to the taz.

The extension of fixed-term contracts “does not solve a single economic problem, but makes a lack of prospects the legal norm - and deprives young families and young professionals in particular of the opportunity to reliably plan their future,” Lang continued. Instead, she expects Schweitzer “to take the side of the employees.”

The left also criticizes the plan. “The planned expansion of the unfounded fixed-term contract is a frontal attack on the rights of employees and also threatens to massively weaken the unions,” said MP Pascal Meiser to the taz. It is “really spineless” how the SPD is once again doing the opposite of what it promised in the election campaign. The consequences, particularly for young employees, would “only further increase young people’s frustration with the federal government’s policies.”