Marginal employment

Minor employment (also called "mini-jobs" or "400-euro jobs") is according to German social security law an employment relationship with a low absolute level of earnings (slightly salaried employment), or employment relationship of short duration (short-term employment). In Germany such employment is exempt from social security, and there are even special features in the income tax law.

History

In 2002 the Hartz commission recommended a series of measures to revitalise the German economy, which Gerhard Schröder implemented as part of his Agenda 2010 reforms. Mini-jobs were introduced as part of Hartz II, which took effect on 1 January 2003. At the time Germany had no minimum wage, which was not introduced until 2015.[1]

Description

Millions of workers at the low end of the scale work in €450 a month tax-free "mini-jobs."[2] In March 2009 there were about 4.9 million marginal workers in Germany.

Social Security

Workers (and their employers) whose "mini-jobs" is their main job contribute to the national retirement pension insurance in Germany. The employee pays 3.7% and the employer pays 15%. They do not contribute to either the national health insurance funds or for unemployment coverage. They can either be covered by the health insurance of the higher earning partner (or parents for Students up to 25 years) or they can contribute on a voluntary basis (flat rate of 140 euro per month).

Outside Germany

On 7 December 2011 it was reported that the European Central Bank sent a letter in August to José Luis Rodríguez Zapatero's government, suggesting that Spain implemented a mini-jobs job category with salaries of 400 euros, a value considerably lower than Spain's minimum wage of 641 euros. This suggestion was presented as a condition for the European Central Bank to continue purchasing Spain's debt.[3]

United Kingdom

In the United Kingdom some 1.4 Million people are employed under Zero-hour contract. Under this type of contract employees have no guaranteed hours of work, pay social security contribution but have no sickness benefits. If a person with one or more zero-hours contract earning under £5,772 a year they will not receive any credits for the state pension.

See also

References

  1. ↑ "Angela Merkel approves Germany's first minimum wage". BBC News. 2 April 2014.
  2. ↑ Kate Connolly; Louise Osborne (30 August 2013). "Low-paid Germans mind rich-poor gap as elections approach: With no national minimum wage and a fifth of workers in insecure mini-jobs, critics say German prosperity is being built on exploitation of the downtrodden". The Guardian (Berlin). Retrieved 31 August 2013.
  3. ↑ "Trabalho: BCE pediu salários inferiores a 400 euros em Espanha". 2011-12-07.