Germany has approved an increase in the minimum wage to 12 euros per hour. From October 1, Germany’s lower house of parliament authorized a rise in the minimum wage to 12 euros ($12.89) per hour, which Labor Minister Hubertus Heil claims will assist almost six million workers in Europe’s largest economy.
According to Heil, the measure, which will receive final approval from parliament’s upper house next Friday, will mostly help women and people in the former communist eastern states. It will also assist low-income workers in coping with rising food and heating expenses, which have contributed to Germany’s record inflation rate.
Since 2015, Germany has had a base hourly wage, despite being one of the few European countries to do so earlier. The present minimum wage is 9.82 euros per hour, but it will increase to 10.45 euros on July 1st.
For many years, labor unions felt no need for a legal minimum wage because of the country’s collective bargaining structure, but a growth in low-paying positions starting in the 1990s prompted a shift in policy.
In their government blueprint, Germany’s ruling coalition of Social Democrats, Greens, and pro-business Free Democrats agreed on the measure.
The minimum wage, according to Martin Rosemann, a labor policy spokesman for Chancellor Olaf Scholz’s SPD, will help eliminate the gender pay gap and “protect people on low incomes from poverty in old age.”
Especially for the many employees in sectors with little collective bargaining coverage, such as gastronomy, cleaning and retail, the increase in the minimum wage is also a sign of the respect society has for these systemically important professions, Rosemann said in an emailed statement.
