Germany rolls out new works council co‑determination and pay‑transparency rules

From January 2027 German works councils will gain expanded co‑determination rights. The reforms cover work‑time recording, the handling of written documents and give councils a stronger say over the deployment of AI systems. Recent court rulings, such as the Landesarbeitsgericht Nürnberg’s 2021 decision, confirm that co‑determination applies even when bonus schemes are organized through foreign parent companies, and the Bundesarbeitsgericht has clarified information‑rights for discretionary bonuses.

By June 2026 the EU's pay‑transparency directive must be transposed into German law. Employers will have to disclose salary ranges in job adverts, provide employees with detailed information on remuneration criteria, and report gender‑pay‑gap data regularly – with obligations scaling by company size. Failure to comply can lead to fines and a reversal of the burden of proof in discrimination disputes. The measures aim to close Germany’s 16 % gender pay gap, which remains above the EU average.