Overview
- Passed on February 26, the law requires companies carrying out federal contracts to grant employees collectively agreed wage and working conditions.
- Coverage begins only for awards above €50,000 and excludes vehicle and equipment deliveries as well as contracts for the Bundeswehr and security authorities.
- Ver.di and the DGB praise the measure as a step against wage undercutting and urge tougher controls, with DGB leader Yasmin Fahimi calling it a major success for workers.
- Employer group Gesamtmetall, led by Oliver Zander, condemns the law as bureaucratic and constitutionally questionable and warns of production shifts and job losses.
- Analysts estimate one third to half of federal contracts fall outside the scope, and the law requires adherence to agreed standards rather than signing collective agreements, prompting calls for monitoring and potential revisions.