Current labor law and political decisions present companies with new challenges – an overview of the most important changes and practical recommendations for implementation.
Labor law reforms and new labor market policy decisions influence the framework conditions for companies – especially for small and medium-sized companies in the mechanical and plant engineering sector. Early information about current developments is crucial in order to navigate safely in a changing legal environment.
To provide companies with targeted support, ProduktionNRW hosted a virtual information event on April 29, 2025. The focus was on the labor market policy effects of the coalition agreement between the CDU, CSU and SPD, the implementation of the European Pay Transparency Directive and new employer-relevant regulations of the EU AI Act.
Coalition agreement between the CDU, CSU and SPD dated March 8, 2025
Fabian Seus, lawyer in the VDMA Legal Department and Head of the Competence Center Labour Market, analyzed the labour market policy content of the new coalition agreement. He took a positive view of the introduction of a maximum weekly working time and the preservation of trust-based working hours. However, the planned obligation to record working hours electronically, special tax regulations for overtime and the lack of comprehensive pension reforms were viewed critically. Additional state intervention in the autonomy of collective bargaining and increasing bureaucracy could represent a considerable burden, particularly for small and medium-sized companies. Progress in the recognition of foreign qualifications in the context of skilled worker immigration has been acknowledged, but important potential, for example in temporary work, remains untapped.
Pay Transparency Directive: Contents and differences to the EntgTranspG
Dr. Christian Hess, lawyer from the VDMA Legal Department, then presented the requirements of the new European Pay Transparency Directive (EntgTranspRL). The aim of the directive is to strengthen the principle of “equal pay for equal work or work of equal value” through greater transparency and more effective enforcement mechanisms. In future, employers will have to disclose salary ranges during the application process and provide employees with information on average salaries for comparable groups. Companies with more than 100 employees will be obliged to regularly report on gender-specific pay gaps. Violations can result in claims for damages, a reversal of the burden of proof, fines and exclusion from public contracts. Companies should therefore review their pay structures at an early stage, develop objective salary criteria and prepare for the new disclosure and reporting obligations.
AI in the employment relationship – employer-relevant regulations of the EU AI Act
To conclude the event, Dr. Christian Hess explained the impact of the new EU AI Act on the employment relationship. Employers who use AI systems to select applicants or assess performance, for example, are considered “operators” and are subject to certain obligations. Irrespective of the risk classification, companies are obliged to promote the AI skills of their employees. The appointment of an AI officer is recommended, but is not mandatory. Non-compliance can result in high fines. Companies should therefore record the AI systems they use at an early stage, carry out risk assessments, define roles and responsibilities and establish internal structures and training.
Organizer
The event is offered by ProduktionNRW. ProduktionNRW is the cluster for mechanical engineering and production technology in North Rhine-Westphalia and is organized by VDMA NRW. ProduktionNRW sees itself as a platform for networking, informing and marketing companies, institutions and networks with each other and along the value chain. Significant parts of the services provided by ProduktionNRW are funded by the Ministry of Economic Affairs, Industry, Climate Protection and Energy of the State of North Rhine-Westphalia.
Further information
- Coalition agreement between the CDU, CSU and SPD dated March 8, 2025.
- Pay Transparency Directive of May 10, 2023.
- EU AI Act of June 13, 2024