Berlin Administrative Court confirms: minimum wage not binding for TNT Post

In its decision in the case against the postal minimum wage, the Berlin Administrative Court today confirmed TNT Post’s interpretation of the law. The court ruled that the postal minimum wage of EUR 9.80 violates the German constitution. In November 2007, this wage was concluded between trade union ver.di and the Deutsche Post-dominated Employers’ association for postal services. In the opinion of the court the Minister of Labour and Social Affairs was not allowed to declare this wage generally binding.

The decision means that TNT Post is not obliged to pay the too high minimum wage under the ordinance passed by the government. However, the decision today is the important first step as the German State has, as expected already, filed an appeal against the decision of the court. The appeal process may take at least six months.
TNT Post will continue to pay the minimum wage to which it is bound under the collective labour agreement for value added services, as agreed by the Employers’ association for new postal and delivery services. At EUR 7.50, TNT Post is paying exactly the minimum wage demanded by ver.di, the Federation of German Trade Unions (DGB) and the Social Democratic Party of Germany (SPD) for many years.

“Today is a good day for Germany as a place to do business. We are pleased that our interpretation of the law has been confirmed,” commented Mario Frusch, CEO of TNT Post Germany. “However it can only be seen as a first step towards a level playing field; alongside the postal minimum wage, the VAT exemption presents another significant barrier to competition that needs to be broken down.”

TNT has always been in favour of a minimum wage. Mario Frusch: “Minimum wages must be in line with the cost of living, but should not be abused to inhibit competition and protect a monopolist.”