Angela Merkel is struggling to form a governing coalition after talks collapsed. The longtime German chancellor lost considerable support in recent elections, forcing her to join together with political rivals to remain in power. Merkel must now find a consensus across the political divide on issues such as immigration, climate change and affordable housing. One key item on her political agenda is an overhaul of the country’s labor laws. Here’s what that would involve.
Germany’s labor laws are nearly a century old
Existing German law places strict limits on time spent at work. Workers cannot, as a general rule, be forced to work longer than eight hours a day. They also must get a 30-minute break after six hours on the job and be given at least 11 hours of rest between consecutive workdays. These rules — introduced after the 1918 revolution — are a source of pride for Germany’s labor movement.
But the existing rules are also, critics argue, ill-suited to meet the needs of the modern era. Christoph Schmidt chairs the Council of Economic Experts, a group of academics who advise lawmakers on fiscal policy. In an interview with Germany’s Die Welt newspaper, Schmidt, says, “The idea of starting the work day in the morning in the office and ending with leaving the company is outdated.”
Advocates say that everyone would benefit if the rules changed
Schmidt, along with many German employers, favors a more “flexible” working arrangement. They propose abandoning the eight-hour working day altogether. Under the new plan, limits would apply only to the maximum number of hours worked per week. The minimum rest period between consecutive workdays also would be reduced to nine hours, down from the current 11. These changes would give German companies more say over when and how human capital is spent. Proponents claim that the workforce also would benefit. Workers could pick a schedule in consultation with management that best suits their individual needs rather than being confined to a schedule created in a revolution nearly a century ago.
However, the research is ambiguous
Research shows a clear link between flexible working arrangements and employee happiness. One study concludes that while worker well-being is affected by salaries and job opportunities, “it may also be improved by practices and policies that promote more daily discretion over the timing of workers’ time at work.” Yet whether such arrangements increase productivity is less clear. This is especially true of so-called knowledge workers (e.g., air traffic controllers, engineers and pharmacists) whose economic value lies in thinking for a living. Their productivity can drop after a mere hour on the job. Such findings provide an alternative perspective on the law, given that its main intention is to boost economic competitiveness by lengthening the average work day.
It will be hard to pass the law
It won’t be easy to pass the law. The leftist Green party, whose support is critical to propping up Merkel’s yet-to-be-formed government, opposes reforming the law and cites concerns about employee health. Similar sentiments have been voiced by German labor unions. The country’s labor system already has effectively been split in two because of the spread of “mini-jobs” — part time positions with relatively little labor protections — and unions fear that this is another nail in the coffin of German labor protections.
Further complicating matters is the recent breakdown in talks between Merkel’s ruling conservatives and the pro-business, small government Free Democratic Party (FDP). The FDP previously voiced support for the new law. Its exit from a governing coalition will make it substantially harder for Merkel to change the rules as she would like.
Ashley Nunes is a research scientist at MIT’s Center for Transportation and Logistics.