The European Commission launched legal action against Germany on Tuesday (19 May), accusing the government of illegally applying the national minimum wage to a number of trucking and haulage companies from Austria, Poland and Hungary.
The EU’s powerful regulator objects to the application of a national minimum wage to lorry drivers passing through the country even just for a few hours and the substantial paperwork associated with that.
“Whilst fully supporting the introduction of a minimum wage in Germany, the Commission considers that the application of the Minimum Wage Act to all transport operations which touch German territory restricts the freedom to provide services and the free movement of goods in a disproportionate manner,” the executive said in a statement.
Germany introduced a national minimum wage of 8.50 euros an hour on 1 January, even for foreign truck drivers simply passing through to other destinations.
The companies affected in March asked the Commission to examine whether applying the minimum wage in this way is compatible with European law. The issue was also discussed in the European Parliament after several EU member states complained about a limitation of the free movement of goods and bureaucratic obstacles.
The launch of the case in Brussels is the first step in a procedure that can end with hefty fines for Germany, which has two months to respond.
“The application of German measures to transit and certain international transport operations can in the Commission’s view not be justified, as it creates disproportionate administrative barriers which prevent the internal market from functioning properly,” it said.
The European Commission said it believed that “more proportionate measures” existed to safeguard these workers while still “allowing for free movement of services and goods”.
Germany is the only European country that includes transit workers in the minimum wage. Berlin argues the policy was needed to stave off wage dumping.
Given the protests from foreign companies, Berlin agreed to a temporary suspension for foreign road haulage companies until the EU’s rules on the issue can be clarified.
Germany’s new measure required a Polish truck driver who is heading to Spain to be paid at 8.50 euros per hour from the moment the driver crosses the German border, before reverting to the wage paid in the driver’s home country on leaving German soil.
The driver’s employer also faced administrative paperwork under the measure and a fine if the drivers were not paid accordingly.
On 1 January 2015, Germany introduced a general minimum gross salary of €8.50 per hour.
The wage floor will be readjusted yearly, starting in 2018. A minimum wage committee consisting of employer and employee representatives will decide on the adjustments made. Researchers will advise the committee. The German government can make the adjustment binding by regulation for all employers and workers.
Almost all EU member states - 21 of the 28 - have a legal minimum wage covering all sectors. The exceptions - besides Germany for the time being - are Denmark, Finland, Italy, Austria, Sweden and Cyprus.