Description
The Act on the Modernisation and Digitalization of the Combat against Undeclared Work and Unlawful Employment (SchwarzArbMoDiG) formally integrates the platform economy into the German framework for combating illegal employment by amending Section 2a (1) of the Combat against Undeclared Work and Unlawful Employment Act (SchwarzArbG).
The purpose of the regulation is now not only to combat but also to prevent undeclared work and unlawful employment. In future, audits are to be carried out on the basis of a risk-oriented approach.
'Platform-based delivery services' (including platform operators and subcontractors for food or courier delivery) are added to the statutory list of high-risk industries. Due to their inclusion in the SchwarzArbG industry catalogue, these employers are excluded from the 'text form' simplifications of the Act on Proof of the Essential Working Conditions (Nachweisgesetz – NachwG).
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Employment contracts and essential conditions must be documented with a handwritten ('wet ink') signature; electronic signatures are insufficient for these specific records.
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Employers must explicitly inform workers of their obligation to carry identification documents before they commence work. Written proof of this notification must be maintained for inspection.
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The Financial Control of Undeclared Work Unit (FKS) is granted expanded authority:
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FKS may inspect electronic data and cloud storage without prior notice. Employers must provide free access to IT infrastructure, including time-recording and accounting systems, in a machine-readable format.
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The FKS can independently conduct criminal investigations and apply for penalty orders in cases of social security fraud or withholding of contributions (Section 266a StGB), reducing the necessity for referrals to the public prosecutor.
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The FKS is authorised to establishes identities using photographs and fingerprints, with direct access to police information networks.
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Introduction of an automated information and data analysis system to identify risk parameters and target audits based on risk indicators.
Penalties
* Administrative fines expanded to cover failures to provide digitised, machine-readable data or late transmissions.
- Under the new Section 9 SchwarzArbG, the commercial facilitation of unlawful employment through the issuance of false documents is punishable by up to five years' imprisonment.
Germany must complete the transposition of the Platform Work Directive by 2 December 2026..
Updates (1)
The following recent changes to this legislation have been recorded.
- 4 March 2026
An amendment to the Act on the Modernisation and Digitalization of the Fight against Illegal Employment came into force on 30 December 2025. It introduced the following legal obligations:
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Sector Classification: 'Platform-based delivery services' are now explicitly listed as a high-risk industry in Section 2a (1).
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Identification Duty: Workers in this sector are legally required to carry and present identification documents during work.
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Recording Obligations: Under Section 17 (1) of the Minimum Wage Act (MiLoG), employers in this sector must record the start, end, and duration of daily working hours. These records must be created within seven days and retained for two years.
- Keywords
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algorithmic management,
employment status,
regulatory changes
- Actors
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Government
- Sector
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No specific sector focus
Sources
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On November 11th 2024, the new EU directive 2024/2831 on improving working conditions in platform work was published in the Official Journal of the EU. It ented into force on …
Germany
