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De-regulation of temporary agency work

Country of implementation
General short description of the innovation
The de-regulation of temporary agency work in 2003 was the latest of a number of reform measures, carried out over a period of more than 20 years. The following chronology of the various reforms will provide a brief overview of the main measures undertaken to meet the needs and requirements regarding flexibility and costs of both the temporary employment agencies and the user undertakings on the one hand, and the interests of the employees working for temporary employment agencies on the other hand. / / 1972: Introduction of temporary agency work in Germany. However, unlike in other European countries, temporary agency workers had working contracts of indefinite duration. Hence, the prohibition of synchronisation, meaning that the temporary employment agencies were not allowed to draw up working contracts that only apply for the duration of the respective assignment. / / 1982: A ban on temporary agency work in the main construction trade / / 1985: The maximum duration for lending employees was raised from three months to six months. / / 1994: The maximum duration for lending employees was raised from six months to nine months. In addition, the prohibition of synchronisation was abolished for those unemployed, for whom it is particularly difficult to find a job. / / 1997: The maximum duration for lending employees was raised from nine months to twelve months. Furthermore it became possible to draw up a fixed-term work contract once without an objective reason. In addition, the former obligation to offer those employees with three subsequent fixed-time work contract an unlimited working contract was abolished. This means that temporary employment agencies are allowed to employ persons by using a, theoretically unlimited, sequence of fixed-term work contracts. / / 2002: The maximum duration for lending employees was raised from twelve months to 24 months. After 12 months of service for one and the same company, however, employers are obliged to adapt both working conditions remuneration of temporary agency workers to that of core taff with comparable competences and tasks. / / In 2003, the limitation on maximum duration of temporary agency work was completely abolished. The same applies to the prohibition of synchronisation. Instead, the equal treatment principle that came into force in 2002, now applies from the beginning of a new job. However, the latter only applies for those companies without a contrary collective agreement.
Target group
Total Population
Policy Field
  • employment
Type of Policy
  • public
Duration of the policy
2003; open - ended
Scope of innovation
  • Scope: Especially after the last reform in 2003, temporary agency work has become a structural element to offer employment opportunities to people who have difficulties to find regular employment.
  • Budgets: no fixed budget
  • Spatial coverage: national
General description of (intended) objectives and strategies
The main objective of the innovation was to generate additional employment especially for those groups on the labour market who have difficulties to find regular employment. This target should especially be met by abolishing nearly all former regulations on temporary agency work (e.g. limitation of the maximum duration for working in one and the same company; abolition of the prohibition of synchronisation etc.). / However, a second explicit goal was the equal treatment of core workers and temporary agency workers in the companies. The reform of 2011 has confirmed this objective by setting minimum standards for collective agreements regarding the equal treatment of core staff and temporary agency workers and by introducing the possibility to agree sectoral minimum wages or the sector.
Type of ideal-typical strategy for the innovation
  • typical strategy for the innovation (optional; according to Obinger)-dualisation
  • typical strategy for the innovation (optional; according to Obinger)-liberalisation
Type of innovation
  • retrenchment or expansion of an existing/earlier policy
New outputs
  • regulations of the labour market
Intended target group
Special groups are unemployed people, for whom it is particularly difficult to find a job, people of working age who have difficulties finding a job, e.g. low-skilled workers, migrants having difficulties with the recognition of vocational trainings obtained abroad (see innovation no. 26), young persons with no or only modest work experience
Working age population
  • employment situation (please specify: e.g. typical work/atypical/unemployed) (A typical form of employment)
  • income level (low/medium/high) (low-pay sector)
  • main source of income: paid work
Actors involved in policy-making/implementation and/or evaluation
  • making/implementation and/or evaluation-central state
  • making/implementation and/or evaluation-employees (organised or individual)
  • making/implementation and/or evaluation-employers (organised or individual)
Intended output
  • regulation of the labour market
  • wages
Clarification of outcomes in terms of impacting resilience and labour market inclusion
Temporary agency workers have been more strongly affected by the slump of GDP in 2008 and 2009 than other forms of non-standard employment. The reason is that a large bulk of temporary agency work tend to be concentrated in the export-oriented industrial sectors which were much more affected by the crisis than the service sector for instance. In addition temporary agency work serves to a large extent as capacity buffers in manufacturing. This means, that temporary agency workers were the first to leave during the crisis.
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