Employers are demanding a halt to the planned reform

Employers are demanding a halt to the planned reform

Waiter at work

The government wants to relieve employees with earnings of up to 2,000 euros from social security contributions.

(Photo: dpa)

Berlin Shortly before the final legislative deliberations in the Bundestag, the Confederation of German Employers’ Associations (BDA) warns of the planned further Raising the midi job limit. This is “a serious mistake,” said BDA chief executive Steffen Kampeter to the Handelsblatt. “I appeal to the coalition factions not to take this step.”

SPDGreens and FDP want the so-called transition area between a mini-job with a maximum monthly salary of 520 euros and employment that is subject to full social security contributions. The midi job limit had already been raised to 1,600 euros on October 1st. From January it should rise to 2000 euros. On Thursday, the Bundestag will discuss the corresponding law in the second and third reading.

In the transition area, employees only pay reduced social security contributions. According to the draft law, the reform will save them around 1.3 billion euros a year, while employers and social security funds together have to shoulder the same amount of additional expenditure or reduced income.

The planned reform “would create additional disincentives against extending working hours, make work more expensive and put additional pressure on social security contribution rates,” warns Kampeter in a letter to the parliamentary group leaders SPDgreens, FDP and Union.

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From the point of view of the BDA, the reform makes full-time work less attractive than part-time work, as it calculates in its statement on the draft law using the example of a part-time employee with 20 hours a week and an hourly wage of 15 euros. If he were to increase his working hours to 30 hours, i.e. by 50 percent, his social security contributions would increase by around 90 percent. In view of the shortage of skilled workers, all incentives should actually be set in such a way that as many employees as possible work full-time, writes the association.

>> Read more about the midi job reform here: Up to 753 euros relief for employees – big trouble for employers

The BDA also accuses the government of underestimating the costs for employers in the draft law. Because these would also have to help proportionately to compensate for the loss of contributions in social security through the reduced contributions of midi-jobbers.

Steffen Kampeter

The BDA general manager considers the step taken by the federal government to be a mistake.

(Photo: Reuters)

In addition, the coalition is increasingly saying goodbye to the equal financing of social security because the reform in the transitional area means that employers would have to pay a contribution rate of up to 28 percent and thus more than two thirds of the contributions due.

The BDA is not alone in its skepticism about the planned reform. At the hearing in the Bundestag Committee for Labor and Social Affairs on Monday, criticism came from a wide variety of directions. The Institute for Labor Market and Occupational Research (IAB) and the German pension insurance system complained that the reform would continue to subsidize part-time jobs and low-paid employment.

The social security contributors bear the costs

The Confederation of German Trade Unions (DGB) criticized that the expansion of the transition area was not very accurate and deprived the social security funds of considerable contribution funds that had to be financed by all other contributors.

>> Read here: The 40 percent limit for contributions should fall soon – that’s why social security is so expensive

“Afterwards, it is mainly those who work full-time who pay the bill. Instead of more net from the gross, we only end up with higher taxes again,” complains BDA General Manager Kampeter.

“This policy, which has fallen out of time, must finally come to an end.” In this great crisis, it is about protecting employees and companies from higher taxes.

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