Germany: strong resurgence of regional laws linking public contracts and the respect of local collective agreements

Get out of the dilemma brought by the decree.  After the ECJ’s ruling (see our dispatch No. 080268), ten Lander abrogated their law on public contracts or gave up the idea of adopting one.  However, the Hans-Böckler foundation says that they are coming back.  Most Länder want to link the award of public contracts and the respect of tariff standards again.  “More and more Länder try to assess the room for maneuver they have to determine social criteria ensuring fair competition conditions when awarding public contracts” explained Thorsten Schulten, expert in Community tariff policy at the Hans-Böckler Foundation.  Four Länder (Bremen, Berlin, Hamburg and Low Saxony) have already adopted new laws in keeping with Community law.  Six other Länder (Brandenburg, Mecklenburg, Rhineland-Palatinate, Saarland and Thuringia) developed or announced bills for this autumn.  The coalition contract of the new North Rhine-Westphalia government also provides for one.  According to Mr. Schulten, this new dynamic shows that many Länder are trying to get out of the dilemma caused by the Rüffert decree.  Indeed, the Länder are supposed to award public contracts to whoever offers the best price.  “However, in the absence of social or tariff requirements, the State itself would contribute to the erosion of collective agreements by favoring businesses that aren’t subject to collective agreements,” the researcher pointed out.
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The coalition contract of the new North Rhine-Westphalia government also provides for one. According to Mr. Schulten, this new dynamic shows that many Länder are trying to get out of the dilemma caused by the Rüffert decree. Indeed, the Länder are supposed to award public contracts to whoever offers the best price. “However, in the absence of social or tariff requirements, the State itself would contribute to the erosion of collective agreements by favoring businesses that aren’t subject to

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