The German government proposes a reform that will reduce job protection against dismissal for high-income employees.

The German government, led by Chancellor Friedrich Merz, is preparing a labor market reform that could reduce job protection against dismissal for employees with very high incomes, especially those earning around 15,000 euros gross per month. This measure is part of a package of economic reforms agreed upon by the CDU/CSU and SPD coalition, aimed at increasing flexibility in the labor market and stimulating the economy.

Although the reform has generated debates, experts estimate that the impact will be limited, affecting only 0.27% of the workforce. If adopted, the reform will allow employers to more easily dismiss these individuals, starting in 2027, providing severance pay.

Additionally, the government will introduce tax incentives for those dismissed who quickly find a new job, thus encouraging professional mobility. Chancellor Merz emphasizes the need for bold measures to regain the competitiveness of the German economy, and the modification of job protection against dismissal is just one of the planned changes. The majority of employees will not be affected, as the legislation regarding job protection will remain unchanged for them.