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APSCo welcomes German revision of employment status

Tue, 1 Mar 2016

Germany’s government has revised a proposal for a law change that critics warned could have created confusion about the employee status of contractors operating in the country, a move applauded by the Association of Professional Staffing Companies (APSCo).

Last November, minister Andrea Nahles of the German federal ministry for labour & social affairs proposed changes to the Arbeitnehmerüberlassungsgesetz (AüG) licence. Included was a provision to limit assignments of ‘leased’ workers to 18 months.

APSCo and recruitment agency alliance Allianz für selbstständige Wissensarbeit (ADESW) warned another of the changes would widen the definition of an “employed relationship” and could see freelance relationships misinterpreted as employed relationships. The AüG licence allows companies to ‘lease’ temporary labour. 

Last month APSCo and ADESW ramped up their campaigns against the proposal. Last week, the German federal ministry for labour & social affairs removed the proposal concerning employed relationships.

Tremayne Elson, managing director of APSCo Germany, welcomed the move from the German government as a “positive step”.

But he added in a statement to Recruiter: “We must not lose sight of the fact that this has become a political debate and until the revised legislation is either adopted or dropped, we will continue to pay close attention to minister Nahles."

According to Thomas Leister, partner and director of German operations at law firm Osborne Clarke, a decision on whether the proposal is adopted or dropped could be taken on 9 March when it is discussed in the Bundestag, Germany’s parliament.

But he warns employers should still consult an employment law firm to ascertain a contractor’s status.

“It is still a relatively high uncertainty,” Leister told Recruiter. “At the end they need advice whether it’s a dependent or an independent contractor relationship.

“The standard employer cannot assess this because you have to check the case law and know how the authorities act.”

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