Germany: Institutions, policies and practices for enforcing minimum wage compliance

In the EU, non-compliance with statutory or negotiated minimum wages averages 6.93% or 1.3%, depending on the statistics used. The lowest national estimate is 0.01% in Belgium and the highest is 11.59% in Hungary. It mostly affects young workers, those on fixed-term or part-time contracts and those working for small companies. It is more common in services than in manufacturing, and is characterised by shorter working time. Member States monitor, enforce and promote compliance in similar ways, although with some differences. This report identifies hindering and enabling factors. Some countries focus on specific economic sectors, such as construction, domestic work, platform work, agriculture and meat processing. National authorities often enforce minimum wages indirectly by helping employers comply, raising workers’ awareness, and helping stakeholders increase cooperation and develop faster procedures. Combining these soft initiatives with tougher measures increases the effectiveness of inspectorates’ actions in enforcing compliance with minimum wages.