Digitalization of All Employment Contracts Foreseen for Future
In the eyes of the federal government, the resolution of work disputes is slated for complete digital transformation in the near future. On a Wednesday meeting, the cabinet agreed upon a draft proposal for this venture, which aligns with the suggestions from traffic light coalitions in the Bundestag. This means that labor contracts could potentially be digitally signed via email. Industries vulnerable to black market work and illegal employment will be the exceptions to the rule.
Once approved, this draft will serve as a base for more discussions regarding the fourth bureaucracy reduction law in parliament. The document includes provisions for electronic transmission of essential labor contract conditions online. However, employees may still request a printed contract if they prefer.
The draft proposal may also bring changes for listed companies. Instead of publishing remuneration-related resolutions in the Federal Gazette, it would be enough to inform shareholders through the company's website.
With the new registration process, business owners only need to register with the new authority when moving their business premises into another jurisdiction, eliminating the need for separate registration and deregistration.
Labor Market President Rainer Dulger endorsed the federal cabinet's decision, stating, "It's about time: Progress marches on in modernizing old Germany!" He further emphasized the need for digital labor contracts even in previously excluded industries like logistics and building cleaning to provide them with much-needed relief.
The Startup Association praises this decision as an "essential step" for the German economy, as it will reduce burdensome paperwork, eliminate unnecessary paper signatures, and cut costly mailing expenses. The planned changes are expected to make the German labor market more appealing to businesses.
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After this digital transformation, the future of employment contracts will primarily involve digital signatures. The Federal Government is expected to implement changes in employment contracts, requiring only electronic transmission of essential conditions and potentially allowing digital signing via email, except for industries prone to black market work.
