Overview

• The draft law requires firms bidding on federal contracts over €50,000 to pay wages, holiday entitlements and benefits in line with industry collective agreements.
• Labor Minister Bärbel Bas says the measure will secure fair pay and reward companies already bound by tariffs under a broader €500 billion investment package.
• The independent Normenkontrollrat warned that the €50,000 threshold is too low and cautioned that compliance checks could impose excessive bureaucracy on businesses and authorities.
• Employer associations in Saxony, Saxony-Anhalt and Thuringia, along with the BDA, decry the law as a threat to tariff autonomy and a disadvantage to medium-sized firms.
• IG Metall and the DGB back the draft without loopholes, urging swift implementation to prevent public-funded wage dumping.