Government proposes measures to reform skilled crafts

In May 2003, the German government approved proposals to lift the requirement for those practising 65 professions to hold a 'master' craft worker’s certificate. If this plan becomes law, it will, with the exception of some sectors, no longer be necessary to possess a master craft worker’s qualification to run a business related to a skilled trade.

In his statement to parliament (Deutscher Bundestag) on 14 March 2003 about the government's Agenda 2010 programme of economic and social policy reforms (DE0303105F), Chancellor Gerhard Schröder announced his intention to relax rules governing craft workers’ qualifications. Subsequently, on 28 May 2003, the cabinet decided to make it easier to establish businesses in the craft industries. The current legislation, the Craft Trades Directive, stipulates that a 'master’s' certificate is the prerequisite for establishing or taking over a business in the craft sector. Currently, businesses in 94 craft industries have to be led by a qualified 'master' craft worker.

In the future, this rule will be lifted for 65 of these industries, including painting, hairdressing and interior decoration. According to the government’s plans, the current legislation will remain in force in those industries - including electrical work and scaffolding - where there is a risk to public safety. The proposals mean that 'journeymen' in craft industries will be able to found companies, without a master’s certificate, in those areas where there is no danger to third parties. In those craft industries that – if the government’s proposals are passed – will no longer require a master’s certificate, the master’s title will not be abolished and it will still be possible to acquire the title if it is so wished.

In addition to these changes, the 'owner’s principle', whereby the owner of a craft business must also be the master, will be abolished. If the plans become law, the owner of a business need no longer possess a master craft worker’s certificate, but can simply employ a master craft worker.

Through its proposals, the government hopes to stimulate the creation of small businesses and enhance the attractiveness of pursuing training. It also points out that craft workers from neighbouring EU Member States are able to start up companies in Germany without having to possess a master craft worker’s certificate. The new reform plans would, therefore, put a stop to the domestic discrimination faced by German craft workers, by allowing them to compete more fairly for contracts and customers, the government argues. The proposals are part of a broader government initiative to reduce 'red tape' in order to ease the burden on medium-sized companies and to promote growth and employment.

According to the Monopoly Commission (Monopolkommission), an initiative to lift the necessity to possess a master craft worker’s diploma or certificate to run a business related to a skilled trade could lead to the creation of up to 1 million jobs. The Kiel Institute for World Economics (Kieler Institut für Weltwirtschaft, IfW) expects prices in the craft sector to fall. This fall, the Institute argues, is unlikely to be accompanied by a decrease in quality. It also notes that incentives to engage in 'moonlighting' would be lowered. By contrast, critics of the proposed changes argue that less regulation of the craft trades could lead to a fall in standards.

It is unclear whether the government’s proposals to reform craft industries will become law, as the opposition Christian Democratic Party (Christlich Demokratische Partei, CDU) may block the changes through its majority in the upper house of parliament (Bundesrat).