Minimum wage for Germany is rising. This article will tell you about the increase. However, it will not affect everyone. Some people will be exempt from the new minimum wage for at least six months. This applies to minors, interns, and trainees. And some employers will have a couple of years to phase it in.
Minimum wage in Germany
Minimum wage for Germany is set by law. This law is called the Minimum Wage Law and is set in accordance with resolutions of the Minimum Wage Commission. The commission is a bipartisan organization supported by the government and is composed of three members from worker associations and two advisory members from the scientific community. The members are appointed for a five-year term.
- The German statutory minimum wage, which is an hourly rate, is €9.82 as of January 1, 2018, will increase to €10.84 on Jan.1 2019, €11.68 on Jan.1 2020 and then € 12.00 per hour in October 2022.
- Currently, the minimum wage for Germany varies by state 12 €.
- The German statutory minimum wage is determined by the Wage Council of Industry and Trade and the representatives of employees and employers in a particular.
While the CDU/CSU fought against a legal minimum wage, the Social Democrats, Greens, and the neoliberal Free Democrats all backed the proposal. But these parties were not unanimous and the Scholz coalition was able to convince the majority of them to support the minimum wage increase. The minimum wage for Germany is generally recommended by a commission composed of employers and union representatives. However, the Scholz coalition went a step further and legislated the EUR12 mark itself.
The minimum wage is set at eight euros a day and is supposed to reach 12 euros an hour. This increase will come into effect on Oct. 1 and should make it easier for full-time workers to live on pensions.
Minimum wage goes up for Germany
The minimum wage for Germany is set to increase from ten to twelve euros an hour in October. However, critics say the move will make it harder to recruit people in the recovery phase. Germany recently suffered from the COVID-19 pandemic, which has slowed the economy, and is facing a shortage of workers.
A new law passed by the German parliament last year sets an increase in the minimum wage. The increase is aimed at those who work in marginal positions, or mini-jobs. This applies to the majority of workers in the country, but excludes those in apprenticeships and job promotion schemes. It also excludes self-employed individuals and long-term unemployed people who are in the first six months of re-entering the labour market.
This move is a major step forward for Germany. The country’s annual inflation rate hit 7.9% in May, the highest since the winter of 1973-1974. Scholz wants to unite the labor unions and employers in a “concerted action” to curb inflation in Europe’s largest economy.
Current minimum wage for Germany
The current minimum wage for Germany has been increased by two cents, or 0.04 cents per hour, since January 1. It is now applicable to all sectors and regions in Germany. This raise will affect more than six million people, including women. It is expected to cost employers 5-6 billion euros each year.
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The increase will mostly benefit women, as well as workers in the eastern part of the country. It is also expected to boost the purchasing power of the country by EUR4.8 billion. However, the increased spending power of the German population will likely lead to a rise in inflation, which is projected to reach a record high by 2021. Food prices are expected to rise, as well.
There are several ways to compensate for these costs. Businesses can reduce working hours or intensify work to offset their increased labour costs. The Federal Ministry of Labour and Social Affairs (Bundesamt) has implemented an annual survey of over five thousand employers to assess their compliance with minimum wage regulations.
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