Germany cracks down on illegal workers

7 May 2004

BERLIN – The German Parliament has agreed to a new law aimed at cracking down on illegal workers in the nation, which Berlin claims cost the government EUR 370 billion a year in lost tax revenue.

Faced with falling tax revenue and high unemployment, Chancellor Gerhard Schroeder’s Social Democrat-led has been under growing pressure to shore by the country’s fragile labour market and to promote employment.

The bill, which also involves strengthening the nation’s customs authorities, has been passed by the lower house of the German Parliament, the Bundestag, now goes to the parliamentary upper house, the Bundesrat for final approval.

While generally supporting the legislation, the conservative opposition, which controls the Bundesrat has insisted that the law does not address the real problems behind illegal work which includes taxation and the high non-labour costs involved in employing workers.

This includes low-paid jobs in the construction industry as well as the service sector.

The campaign to fight illegal work also comes in the wake of a series of reforms by the government aimed at boosting jobs and introducing more flexibility into the country’s hard-pressed labour market.

The move also coincides with the expansion of the European Union into Central Europe which will make it easier for people to move into western European states such as Germany.

But the measures contained in the bill also represent something of a watering down of previous proposals under consideration by the government which involved extending the clampdown on illegal work to jobs such as cleaning ladies and babysitters.

Subject: German news