10 September 2020
Work/Life – 7 of 20 Insights
Welcome to the latest edition of our international employment news update.
German Labour Minister Hubertus Heil has indicated he's open to proposals for a four-day working week to protect jobs threatened by digitalisation and the COVID-19 pandemic. The minister was responding to calls to introduce a four-day week by IG Metall, the country's largest trade union.
The director of the Confederation of German Employers' Associations has responded that a four-day week will exacerbate the colossal productivity shock, while Volkwagen has said that a four-day week to secure jobs is unnecessary.
Germany's ruling coalition has agreed to extend its job protection scheme until the end of 2021 at a cost that may exceed £27 billion. The subsidies, originally intended for 12 months, pay the bulk of pay cheques and enable companies to retain workers.
It's hoped the measure will aid the recovery of Europe's largest economy after its GDP contracted by 11.7% in the first six months of the year, with 10.1 million workers – including one in three in the industrial sector – on furlough at the peak of the lockdown.
Meanwhile, in the UK, Prime Minister Boris Johnson has confirmed that the UK furlough scheme will not be extended beyond 31 October 2020 and is encouraging a "return to work". Leading investment bank Morgan Stanley predicts the government will U-turn on this decision to combat the deterioration in the jobs market.
French Prime Minister Jean Castex has unveiled a €100 billion coronavirus recovery plan which will create 160,000 new jobs by 2021. "Relaunching the economy and fighting unemployment is the plan's primary objective," Castex said. Similarly, the Netherlands has set up a €20 billion National Growth fund to boost economic growth by investing in projects that develop skills and expertise.
Prominent technology investors in London have voiced concerns that small technology companies in the UK whose staff continue homeworking over the winter will experience reduced productivity.
Brent Hoberman, founder of investment fund firstminute capital, said: "I think it's going to be very detrimental if we keep people apart and we lose the team spirit and learning by osmosis that happens in offices."
Nevertheless, many of the world's largest technology businesses remain committed to homeworking, with Google and Facebook employees set to continue homeworking until July 2021.
According to research by UK energy broker Utility Bidder, Budapest is the most affordable city in the world to run a business from. Factors include average salary (EUR 17,316/year – the second lowest globally of the 70 cities compared), corporate tax rates, monthly internet costs and average office cost. With Prague, Warsaw and Bratislava coming in at second, third, and fourth, the top four spots on the list are all occupied by Eastern European cities.
McDonald's is being sued by 52 former franchise owners in the US, who allege it forced them out of business by placing them in economically depressed locations that were destined to fail and denying them support offered to white franchisees. The lawsuit filed in Illinois seeks up to $1 billion of compensatory damages. The lawsuit comes five weeks after McDonald's updated its corporate values, pledging a greater focus on diversity.
The EU Posted Workers Directive has been transposed into German law. Employees posted to Germany are now entitled to the collective wage from generally binding collective agreements. Employees from abroad will also receive overtime rates, allowances (for example, risk and hazard bonuses) or benefits to be paid by the employer if these are regulated by law or generally binding collective agreements.;
The Trades Union Congress (TUC) has warned that the lack of childcare as a result of the COVID-19 pandemic is hindering mothers looking to return to work. A survey reveals that 41% of working mothers with children under 10 can't get – or are unsure whether they will get – enough childcare to cover the hours they need for work this September.
Figures show that over 2,500 British nationals in the Netherlands took Dutch nationality last year. New legislation will allow Dutch nationals living in Britain to retain their Dutch nationality if they have to become British. By contrast, British nationals who are under the age of 65 and don't have a permanent Dutch partner must surrender their British nationality to become Dutch.