Germany’s political landscape is undergoing significant changes. After new elections had to be held early in February, the Christian Democratic Union and the Social Democratic Party concluded a coalition agreement. This new government promises to tackle a range of issues, many of which will have direct implications for German employment law and, thus, employers.
For foreign employers with operations and employees in Germany, understanding these changes is crucial to maintaining compliance and navigating the evolving labor and employment framework. Below is an overview of the key labor-related provisions in the 2025 coalition agreement that are expected to be implemented over the next four years.
The coalition government emphasizes securing a steady supply of labor and skilled workers as a cornerstone of Germany’s future economic success. The agreement outlines measures to reduce bureaucratic hurdles and promote skilled worker immigration, including the creation of a centralized “Work-and-Stay” agency, aimed at streamlining recruitment processes. For employers, this could mean easier access to talent from abroad, but it also underscores the importance of compliance with evolving immigration and labor market policies.
The government has reiterated its commitment to minimum wage as a basic benchmark for fair compensation. The Minimum Wage Commission is expected to remain independent, yet its future recommendations will be...
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