German Employers Push for Paid Sick-Day Reform as Coalition Targets July Passage of Labor Package
11.06.2026 - 05:14:57 | boerse-global.de
Germany's coalition government, business associations, and trade unions emerged from a marathon meeting late Tuesday agreeing on the scale of the country's labor-market challenges but remain deeply split over how to address them. The session, chaired by Chancellor Friedrich Merz at the chancellery, aimed to map out a reform package slated for parliamentary approval before the summer recess in mid-July.
The cost of employing workers in Germany has become a central flashpoint. According to the metal-industry federation Gesamtmetall, an average hour of labor costs German employers €53.76. In Poland the same hour runs €16.47; in China, just €14.01. Employer representatives — including BDA president Rainer Dulger and DIHK chief Peter Adrian — used those figures to demand a suite of concessions: more flexible working hours, lower ancillary wage costs, and the introduction of a waiting day for paid sick leave (a Karenztag). Unions flatly rejected the proposals.
DGB chairwoman Yasmin Fahimi warned against what she called a one-sided austerity drive. Instead of cutting sick pay, she floated the idea of a mandatory company pension scheme as a way to strengthen worker protections. The meeting also included IG Metall leader Christiane Benner and ver.di boss Frank Werneke.
Government spokesperson Kornelius described the atmosphere as cautiously positive. “There is agreement on the magnitude of the challenges,” he told reporters after more than three hours of talks, pointing to technological change, demographic shifts, and the fallout from international crises. Both sides had signaled willingness to accompany the reform process constructively, he added.
Yet deep tensions remain beneath the surface. CDU/CSU faction leader Jens Spahn urged all participants to reconsider their “red lines” if a compromise is to be reached. SPD faction chief Matthias Miersch stressed that boosting economic growth must take top priority.
The government now faces a tight timeline. A pension commission is due to deliver its proposals for retirement provision by the end of June. A dedicated coalition committee meeting is scheduled for July 1 to finalize the key points. Additional rounds of talks between the government and social partners are planned over the coming weeks, and sources said multi-day sessions of the coalition committee have not been ruled out in order to maintain the reform tempo.
