Press Release No. 46/2016 IG Metall Welcomes Law on Temporary Work and Service Contracts

Frankfurt am Main – IG Metall has welcomed the German Bundestag’s passage of the law on temporary agency work and service contracts. “This means that the coalition agreement is being implemented despite significant resistance from the business community, and improvements for temporary agency workers and those employed under service contracts have been achieved,” said Jörg Hofmann, President of IG Metall, on Friday in Frankfurt.

The union leader also pointed out that not all of the union’s demands were incorporated into the law. “Particularly with regard to the use of service contracts, we had hoped for more co-determination rights for works councils,” said Hofmann. IG Metall will therefore continue to work on company-level and collective bargaining solutions to combat unfair working conditions.

With regard to the use of temporary agency work, the law contains some concrete improvements; above all, it effectively puts a stop to the widespread practice of arbitrarily switching status between (bogus) work contracts and temporary agency work. This is an important step toward better order in the labor market. At the same time, the scope for collective bargaining solutions remains intact. “IG Metall has over 40,000 members in this sector and is responsible for safeguarding their interests. We see the draft law as a good foundation for continuing to effectively represent these workers through collective bargaining in the future,” said Hofmann. The law now places stricter limits on the options previously available to the parties to collective bargaining agreements: After no more than 15 months, wages equivalent to those of permanent employees must be paid. In addition, setting a maximum assignment period is mandatory. “The law gives the collective bargaining parties the leeway to find industry-specific solutions. We therefore continue to believe it makes sense not to aim for the temporary worker to be deregistered once the maximum assignment period is reached, but rather for them to be permanently hired by the client company. However, only the collective bargaining parties—not the legislature—can regulate this,” emphasized Hofmann.

Now that the law has been passed, IG Metall aims to agree on the necessary adjustments to the collective bargaining agreements with the employer associations of the client companies and the temporary staffing industry, based on previous exploratory talks and discussions in the regional branches.