Issue Brief No. 06/2008

Expansion of Minimum Wages

The News

According to the governing coalition, minimum wages are supposed to be expanded to other branches. In December of 2007, minimum wages for the postal branch were introduced by the Bundestag for the first time in the history of the Federal Republic. A coalition working group, which was established in June 2008, is currently debating about what other branches should be incorporated. The working group is led by the Federal Minister for Labour Olaf Scholz. Supporters of minimum wages consider them to be necessary in order to guarantee social standards, whereas critics claim that a wide-spread introduction of these salaries would lead to the loss of jobs.

The Background

The foundation for the definition and expansion of minimum wages are the Arbeitnehmerentsendegesetz (AEntG) and the Mindestarbeitsbedingungengesetz (MiArbG). The Union focuses on the contractually agreed upon tariffs, while the SPD wishes to expand minimum standards to as many branches as possible. The allocation of a specific sector to either the AEntG or the MiArbG depends on the amount of employes being paid tariff wages: If more than 50% are associated than the AEntG comes into force, if less the MiArbG takes effect.

The Milestones

Originally planed by Olaf Scholz to pass congress before Christmas of 2008, the draft is still subject to intensive debate. A meeting on the 4th of December 2008 was aborted without an agreement. Especially the temporary work branch is a controversial issue. The Social Democrats would like to comprise this sector, the CDU underlines the strong tariff foundation which, according to the Christian Democrats, shouldn't be touched. At this point, it is unknown when talks on this subject will resume.

Last Update: 5 Dezember 2008