Relaxation of labor migration rules threatens wages, unions say – DW – 18/03/2023

Germany is struggling with a chronic labor shortage. According to the Employment Research Institute, there are currently 1.98 million vacancies in the country. Now, Berlin plans to fill these gaps by liberalizing labor migration legislation.

This will include two changes to a provision called the “Western Balkans Settlement”, which will not only be extended indefinitely from the current expiry date at the end of 2023, but the quota will also be doubled to include 50,000 applicants for employment per year.

No qualification required

When around one million refugees – mainly from Syria, Afghanistan and Iraq – arrived in Germany via the Balkan route at the end of 2015, at the height of the so-called “refugee crisis”, they were also joined by many people from six Western Balkan countries – Albania, Bosnia and Herzegovina, Kosovo, Montenegro, North Macedonia and Serbia. They filed about 30% of asylum applications at the time, although their chances of acceptance were rather low: only about 5% of them were granted.

To avoid costly repatriations, the government of Chancellor Angela Merkel has reached an agreement with the countries of origin to take care of those deported and examine in advance the situation of those who wish to leave.

Germany desperately needs healthcare workers from Western Balkan countriesPicture: picture-alliance/dpa/O. Berg

In addition to this, the Western Balkan Regulation was introduced in 2016, providing that a defined contingent of job seekers can work in Germany without major bureaucratic obstacles. Unlike skilled workers seeking employment under the blue card scheme, this group does not need any qualifications.

Two rules apply to these people: the application for a work permit must be submitted to the representations of the German State in these countries and the job seeker cannot apply for asylum in advance.

A win-win situation?

The settlement was intended to satisfy all parties, regulating the immigration of unskilled or medium-skilled workers into the German labor market while relieving excess labor in the countries of origin. In Kosovo, for example, the unemployment rate is slightly below 21% overall, but reaches around 55% among young people. In Bosnia and Herzegovina, or in northern Macedonia, the youth unemployment rate exceeds 35%.

With such figures, it is not surprising that the German Federal Employment Agency issued around 260,000 basic permits and 98,000 work visas to workers from Western Balkan countries by the end of 2020.

Fear of “wage dumping”

The planned changes aim to boost those numbers even further, a move that has been welcomed by employers who have lobbied Berlin to liberalize immigration requirements to fill jobs.

The German Confederation of Trade Unions (DGB), however, is more cautious. While welcoming labor migration, says Evelyn Räder, head of labor market policy on the DGB board, the basic conditions of workers in the Western Balkans need special attention .

“People who come are largely dependent on their employer. They have a work-related residence permit. This raises fears that if they don’t follow the rules they will be fired,” says Räder.

Moreover, they often do not speak German and are not informed of their rights. In practice, this leads workers to accept worse working conditions, which can then lead to “wage dumping”, says Räder, referring to a German term for when wages are pushed lower than the rate. market by cheap labour.

Workers instead of skilled workers

Three-quarters of Western Balkan workers find employment in construction, catering and care, including 44% in construction alone. Most of them are part-time jobs with relatively low salaries.

Three quarters of Western Balkan workers work in constructionPicture: picture-alliance/dpa/B. Rossler

Although the federal government justifies labor law reform for foreign workers by saying that it wants to counter the shortage of skilled workers, the Western Balkan settlement deviates from this assertion, as no qualifications are required to obtain a work permit.

According to the DGB’s assessment, the objective is not at all to recruit qualified workers, but to attract blue-collar workers. “It’s purely a labor supply program for the benefit of employers, who gain workers this way, but can quickly get rid of them when needed,” says Räder.

Precarious conditions

This situation is particularly pronounced in the construction industry. Last year, the main construction industry association ended the extension of the decades-old collective agreement. Workers can now earn a legally guaranteed minimum wage of €12 per hour, down from previous hourly wages which averaged between €13 and just under €16 on construction sites.

Now employers pressure anyone who demands a higher salary with the fact that there is always cheaper labor available, and without fear of prosecution. Western Balkan workers are a particularly vulnerable group. They do not know their rights, and for many, even these deteriorating conditions are acceptable compared to the situation in their country of origin. Moreover, there are practically no effective state controls.

Employee protection and collective bargaining under threat

“We are concerned that this will create pressure on the working conditions of all employees in the construction industry. It will become more difficult to conclude good collective agreements, and without them, a dumping program aimed at reducing wages will simply emerge,” says Räder.

The DGB suggests that the solution lies in further changes to the Western Balkan settlement. One of the most important aspects would be the possibility of changing employers without having to reapply for a work permit — as is the case for other foreign workers.

Where have all the skilled workers gone?

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Under current regulations, the work visa application must be made in the employee’s home country and the visa is ultimately issued for a specific job. Changing jobs is possible, but must be requested again from the Federal Employment Agency. It’s a complicated process that many workers aren’t even aware is an option.

The trade unions demand that employment on the basis of the Western Balkan settlement is only possible where collective agreements exist. This would protect both the collective bargaining autonomy of employees and of unions.

The DGB has a clear message for people from Western Balkan countries looking for a job in Germany: “Inform yourself about your rights and ask for help if necessary,” Räder said. “You don’t have to accept everything they offer you. Here, the workers also really have rights.”

This article was originally written in German.

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