On 26 February, the Bundestag approved the Tariftreuegesetz (collective bargaining compliance act), aimed at strengthening collective agreements and tackling social dumping by tying certain public contracts to compliance. Employers’ groups have criticised the law as a "bureaucratic monster", while conservatives – coalition partners of the Social Democrats – secured a narrower scope and a mandatory review clause.
The act aims to reserve public contracts for companies providing fair working conditions. Initially proposed by the SPD during the previous legislative period, the bill was previously blocked by the Free Democratic Party (FDP). Although reintegrated into the current government’s coalition agreement, it remained the subject of intense negotiations with Chancellor Friedrich Merz’s conservative party.
Avoiding wage dumping in numerous public contracts
The Tariftreuegesetz stipulates that certain fe
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