SDG 8
Promote sustained, broad-based and sustainable economic growth, full and productive employment and decent work for all.
§ Amending the Collective Bargaining Law
Collective labour agreements are the most important instrument to improve pay and working conditions. A number of measures are necessary to strengthen collective agreements – including further facilitation of their universal applicability to make them obligatory even for businesses not tied to a collective agreement in a certain sector. With the reform of the Collective Bargaining Law in 2014, it was to become easier to declare collective agreements applicable for an entire branch, but such universal applicability has not yet been achieved as this option is hardly ever used. Other constraints continue to exist after the reform such as the veto option for the employers’ side in the bargaining committee. In addition, the term “paramount importance”, which is mentioned in § 5 of the law as a condition for the universal applicability of collective agreements, requires clarification in the law. In practice, the “paramount importance” of a collective labour agreement is defined via the obligation to pay in line with the quantitative stipulations the employees themselves have agreed to. By this means, the so-called 50-per-cent quorum abolished in 2014, according to which 50 per cent of the employees covered by the geographical, professional and personal scope of the collective agreement must be paid by tariff-bound employers, was reintroduced through the backdoor. A legal provision stipulating universal applicability, and a law that makes collective labour agreements compulsory for public contracts, financial support and government funding needs to be introduced. Membership in Employer’s Federations ought to be linked to participation in collective labour agreements.
For further reading and discussion:
https://www.dgb.de/themen/++co++66535a34-5cfc-11e9-8421-52540088cada
In order to meet the rising demand for skilled labour in Germany and to offer people legal and safe migration options, the introduction of the 2020 Immigration Law for Skilled Professionals was an important step. Although the law does entail some positive changes such as the omission of the priority review (priority employment of EU citizens), the law does not exhaust all possibilities to actually end the lack of skilled labour and create simple access for foreign specialists. Major hurdles continue to exist, among them the recognition of vocational qualifications. The main criteria for entering the country needs to be a labour contract and not the recognition of a vocational qualification. The issue of how qualifications are treated which were acquired in practically performing professional activities for which no formal degree can be provided also remains unaddressed. Here too, the Immigration Law for Skilled Professionals needs to be amended. In recruiting skilled labour, Germany ought to be guided by international codices. For example, in the health sector, the codex issued by the WHO applies to the international recruitment of healthcare staff. It aims to protect local systems from brain-drain due to the migration of skilled staff. Beyond the Immigration Law for Skilled Professionals, options for legal immigration to Germany have to be expanded for non-qualified or low-qualified people. Generally, access to education, training and the labour market has to be provided.
For further reading and discussion:
§ A reform of the Immigration Law for Skilled Professionals
§ Repeal fixed-term employment contracts without material reason
The number of fixed-term contracts without material reason has more than tripled since 2001. Employment contracts may be limited up to two years without any objective reason given. Their share of all labour relationships has risen from 1.7 to 4.8 per cent. Young people are particularly affected. Not only do fixed terms create uncertainty regarding employment prospects, but they also frequently pay less than unlimited employment. Limiting employment terms without material reason has to be abolished. Limiting employment terms for material reasons needs to be restricted. The law governing fixed-term contracts in higher education and research has to be revised correspondingly.
For further reading and discussion:
ver.di - Central demands on the parties for the 2021 Bundestag elections
Due to their enormous purchasing volume, public agencies have an effective lever to press for sustainable business and production practices. A law obliging public procurement to first and foremost consider human rights, environmental and social due diligence from a contract volume of 5,000 euros upwards for the entire value chain can provide a substantial contribution to improving working and living conditions in producing countries. Furthermore, such a law on sustainable public procurement needs to include the obligation to pay collectively bargained wages in Germany as a binding rule in any public contracts and it must set high environmental standards for products (an obligatory inclusion of life-cycle costs, maximum energy efficiency, etc.). Regarding sensitive product groups (at least, but not exclusively according to the 2020 risk survey of the German Ministry of Labor and Social Affairs (BMAS)), in supply chains with frequent human rights violations and forms of environmental destruction, companies have to demonstrate due diligence vis-à-vis the public procurement agency e.g. through consistent reports and the implementation of multi-stakeholder initiatives and sectoral business dialogues. These demands on due diligence ought to go beyond the Supply Chain Law that Germany adopted in 2021 and will enter into force on January 1 2023. Companies that have not observed due diligence have to be excluded from public procurement tendering procedures for an appropriate period of time. To enable procurers to effectively check this via a search in the competition register, the scope of application of the Supply Chain Law has to be extended to all companies with more than 250 employees as well as smaller enterprises in risky sectors. Additional requirements such as documentation and disclosure obligations have to apply in the case of the major central contracting authorities of the national and State Government administrative bodies. This can contribute e.g. to tax money being spent on responsible and sustainable products and services in the spirit of the SDGs. The law also has to introduce control measures for the observance of social, ecological and collective labour agreement provisions. Along with the implementation of the law there needs to be concrete sustainability criteria, indicators and targets for public procurement and allocation of contracts by the German government and for investing special assets (e.g. pension funds). An advisory council such as the Advisory Council for Sustainable Finance and an independent committee of experts in sustainable procurement can provide the necessary expertise and act as a supervising body. This ought to be complemented by training at all responsible procurement authorities based on concrete requirements. An example for such a law can be found in Scotland, where the public procurement law has already been amended.
For further reading and discussion:
https://www.bmz.de/de/zentrales_downloadarchiv/Presse/Leitfaden-Textilbeschaffung.pdf
https://lieferkettengesetz.de/wp-content/uploads/2020/02/200527_lk_rechtsgutachten_webversion_ds.pdf
§ Introducing sustainable criteria for the provision of emergency aid and economic stimulus packages
§ Introduce sustainable criteria for the allocation of crisis aid and economic stimulus packages
Emergency aid and economic stimulus programmes ought to promote businesses and organisations that provide added value for society and thus contribute to a resilient economy. In awarding emergency aid and economic stimulus packages, the legal framework must make respect for human rights a basic condition for businesses and suppliers to receive financial support. This should apply not only to enterprises with more than 500 staff and/or a turnover of 50 million euros but for all businesses bearing human rights risks in their value chains. The SDGs, the UN Guiding Principles on Business and Human Rights and the Paris Agreement must be the guiding principles for crisis aid. Only those enterprises which can provide proof of climate targets and transformation strategies for decarbonisation in line with the Paris Climate Goals or that are aligning their business model with the SDGs along clearly defined milestones. should receive government support. Business practices and products which clash with the implementation of the SDGs must not receive any government support. A binding sustainability auditing standard such as the Common Good Balance Sheet or the German Sustain ability Codex can serve as a benchmark for such emergency aid. Social and environmental award criteria should be established with recourse to the so-called green taxonomy or green accounting.
For further reading and discussion
https://www.sdgwatcheurope.org/documents/2020/06/covid-19-statement-sdg-we-final.pdf/
https://fragdenstaat.de/aktionen/coronahilfen/
Rather than preventing market concentration, the control of mergers introduced by the German Cartel Office in 1973 does in fact rather enable it. Social justice, human rights, environmental protection, consumer protection, and data protection ought to be on a par with the goal of free competition in antitrust law. In merger control, the pros and cons ought to be assessed with regard to the public interest. Vertical mergers, i.e. mergers across market levels, ought to be subject to more stringent merger control. Reformed antitrust law must also create transparency regarding market power, property and business structures, linkages, supply chains, and patents. The Cartel Office ought to be complemented by an arbitration office that can investigate and record anonymously submitted cases of abuse, penalise them and, where appropriate, impose sanctions or forward the cases to the Cartel Office. This office ought to be explicitly dedicated to the concerns of farmers, consumers, and suppliers. An antitrust law reform would also create a level playing field for SMEs vis-à-vis transnational corporations. Among other things, a reform of antitrust law has to provide framework conditions for the digital economy, including the restriction of the power of large tech companies, thereby strengthening the interests of users and enabling the development of alternative business models such as platform cooperatives. In some OECD member states, such as the United Kingdom and the USA, such an antitrust law de-merger instrument already exists. Here, the USA boasts the longest and most far-reaching experience with demerging enterprises. The legal basis for US American demerging procedures is the Sherman Antitrust Law of 1890. While the Sherman Antitrust Law contains no explicit regulation of demerging, it does provide for a general ban on monopolies. In particular, it outlaws trade monopolisation, the attempt to monopolise, and the co-acting of several parties for this purpose. A reform of the antitrust law must address any action with a negative impact on competition.
For further reading and discussion:
https://www.aktion-agrar.de/wp-content/uploads/2018/01/Plattformpapier_Konzernmacht_beschraenken.pdf
§ Reforming the Antitrust Law
§ Creating a Sustainability Fund for the use of Dormant Assets
Dormant assets are those assets for which financial service providers have lost touch with the owner, for example because they might have died and their heirs are unaware of the existence of these assets. The total value of dormant bank accounts in Germany ranges from two to nine billion euros. A mere five per cent of the overall volume of dormant bank accounts is claimed by the claimant, while the rest is typically deleted from the account after 30 years and claimed as extraordinary gains by the banks. Except for Germany, all G7 countries have legal regulations governing the handling of dormant assets. With the creation of a sustainability fund or a social impact fund with a wide range of options for the use of the funds, such money could be spent for social, cultural and societal purposes, as is the case in other countries (e.g. Switzerland, the United Kingdom, Japan). The gains and assets in the social impact fund would be used in accordance with the decisions taken by the legislator, and on the basis of the investment directives of a political advisory council.
For further reading and discussion
https://www.send-ev.de/wp-content/uploads/2021/03/2_Auflage_Nachrichtenlose_Assets.pdf
This also works at the federal level
Since July 2018, the share portfolio of the special assets to support the financing of future pensions in the State of Baden-Württemberg have met the sustainability criteria 100 per cent. Since 2017, exclusion criteria have been in force to supplement the investment guidelines adopted by an advisory council.
For further reading and discussion:
§ Restructuring the pension fund to meet sustainable investment criteria in the State of Baden-Württemberg
§ A flexibility bonus for subcontracted employment in France
In France, there is the principle of general equal treatment according to which short-term employed people have to be treated equally to core employees regarding working and remuneration conditions. Although the use of temporary workers is limited to a maximum of 18 months, as in Germany, in France this limitation cannot be lifted by collective bargaining. Subcontracted labour is not possible in France as the equal pay principle cannot be circumvented there. In addition, subcontracted employees in France are entitled to “compensation for insecure employment” amounting to ten per cent of the total wage and the use of subcontracted employees as strikebreakers in the event of an industrial dispute is not permitted in France. Compensation for insecure employment and the equal pay principle should also be used in Germany in order to recognise the flexibility of the subcontracted employees and put them on a par with core employees. What should not be reproduced is the fact that in France subcontracted employees are only employed for the period of the respective work assignment and subsequently become unemployed.
For further reading and discussion:
https://www.boeckler.de/de/boeckler-impuls-leiharbeit-nachbarn-regulieren-besser-8790.htm