(Adds reaction, context, detail)
BERLIN, April 2 Germany's cabinet agreed on
Wednesday to a national minimum wage of 8.50 euros ($11.75) per
hour - a flagship project for the Social Democrats (SPD) who
share power with Angela Merkel's conservatives.
The minimum wage will take effect in Europe's biggest
economy from 2015 but will not cover minors, trainees and some
interns. Some employers can continue to pay their workers less
until the end of 2016 if they are covered by certain collective
Companies will also be able to pay the long-term unemployed
less than the legal minimum wage for the first six months of a
"The minimum wage is coming," SPD Labour Minister Andrea
Nahles said at a news conference in Berlin.
"It is, above all, good news for people who work hard but
get such low wages that they can't live from them so I hope that
with this pay package we will create more wage justice and
that's good for cohesion in Germany overall," she added.
The minister has reassured employers in sectors where
seasonal work is common, such as agriculture, hotels and
restaurants, by offering support to help them adjust to the
The Bundestag lower house of parliament is due to debate
the law in June before passing it in July. The Bundesrat upper
house is expected to wave it through after the summer break.
Employer lobbies say the plan will cost jobs and introduce
too much regulation.
But Nahles said: "We're not expecting any effects, be they
positive or negative, on employment at the moment," pointing to
Germany's previous experience with 13 sectoral minimum wages and
the experience of other countries.
Of the 28 states in the European Union, 21 have minimum
wages. EU states without minimum wages tend to have smaller
low-wage sectors than Germany and a bigger proportion of their
workers are covered by collective wage deals between unions and
Peter Weiss, head of the workers' faction in Merkel's
conservative Christian Democrats (CDU), welcomed the cabinet's
"With the general minimum wage we are taking a clear stand
against unfair wages," he said.
But Frank Bsirske, head of Verdi trade union, said excluding
the long-term unemployed from the minimum wage was
discriminatory. German welfare organisation Paritaetische
Wohlfahrtsverband said said it marked the start of a "two-tier
Slightly more than a tenth of workers in western Germany
earn less than the proposed 8.50 euros an hour, compared with a
quarter of workers in eastern Germany, according to data from
the IWH institute.
($1 = 0.7249 Euros)
(Reporting by Holger Hansen; Writing by Michelle Martin;
Editing by Madeline Chambers/Ruth Pitchford)