The new “tariff loyalty law” introduced by federal Labour Minister Bärbel Bas (SPD) misses the mark for small and medium‑sized businesses, Rainer Kirchdörfer, chairman of the Foundation for Family Businesses and Politics, told the “Redaktionsnetzwerk Deutschland”. He argues that the legislation does not increase tariff binding but instead adds to the administrative burden for companies when bidding for state contracts. “Already today a large number of firms are withdrawing from public tenders because the paperwork is too heavy” he warned. Around 90 % of all German companies are family‑run.
Kirchdörfer accused the black‑red coalition of “failing to recognise the seriousness of the situation”. While the coalition has long touted bureaucracy reduction, it actually introduces new administrative hurdles that affect both businesses and the authorities that oversee them. “Instead of removing growth brakes, the coalition creates new ones” he said.
Oliver Zander, chief executive of the employers’ association Gesamtmetall, echoed this view on Thursday. “With the tariff loyalty law the coalition reverses its promises of deregulation and repeats the mistakes of the Supply Chain Due Diligence Act” he said. “The law is constitutionally questionable because it does not aim to increase the extent of tariff binding”.
Zander also cited the ongoing deindustrialisation, claiming that poor site conditions have made it unprofitable for many companies to produce in Germany. Bureaucracy, he said, is one of the four major site afflictions. “The fact that such a law is passed at full speed in this situation is incomprehensible and indefensible. It represents a deliberate lack of responsibility on the part of the coalition”.
