### Extra Money for Hundreds of Thousands of Civil Servants in Germany
#### A Windfall for State Employees
Many state employees in Germany may be in for a pleasant surprise as they could be entitled to a retroactive pay increase, with some potentially receiving tens of thousands of euros.
#### The Lucky Recipients
The fortunate ones in this scenario are federal and state civil servants, who stand to benefit from a ruling by the Constitutional Court in 2020. According to the ruling, civil servants must earn at least 15% more than individuals receiving basic welfare support.
#### Proposed Changes
Federal Minister of the Interior, Nancy Faeser (54, SPD), is spearheading a new law that aims to increase the salaries of civil servants in pay grades A3 (starting at 2710 euros per month) to A7. Additionally, there will be higher allowances for all, with the allowances being based on the cost of living in the respective area and the number of children.
#### Specifics of the Proposed Law
In the draft law (obtained by BILD), it states that married or widowed civil servants will receive an additional 171.28 euros gross per month. Civil servants with one child can receive up to 317.66 euros gross per month, with two children up to 464.04 euros extra, and for each additional child, up to 456.06 euros per month. This means that a civil servant with three children could receive up to 920.10 euros in addition to child benefits.
#### Retroactive Payments
These allowances are also set to be paid retroactively from 2021. For example, a family of four with high rent could receive up to 44,000 euros as a one-time payment if the law is enacted.
#### Additional Benefits
Those who have previously demanded higher pay from their employer (often represented by staff councils) may also be entitled to retroactive payments dating back to 2017. This could mean a four-person family receiving up to 88,000 euros.
#### Benefits for Civil Servants in Different States
Civil servants in various states, such as police officers and teachers, stand to benefit as well. Governments in Hamburg, Lower Saxony, and Schleswig-Holstein are currently working on similar laws. Civil servants in Baden-Württemberg, Hesse, and North Rhine-Westphalia already have claims to higher allowances and additional payments.
#### Family Allowances Defined
The draft legislation, currently under review since late August, also specifies the amounts of family allowances. For instance, married civil servants in grade 1 will receive an additional 171.28 euros gross. Those in grade 2 with children will receive 317.66 euros gross for one child, an additional 146.38 euros for two children (totaling 464.04 euros gross), and 456.06 euros for each additional child. A civil servant with three children could receive 920.01 euros gross (in addition to child benefits for each child).
#### Benefits for Pensioners
Retirees will also receive the “alimentary supplementary allowance” on their pension, along with retroactive compensation dating back to 2017 or 2021.
#### Financial Implications
The draft legislation from the Ministry of the Interior led by Nancy Faeser estimates additional costs of 147.6 million euros for the federal budget in 2025. This figure is expected to increase to 131.4 million euros in 2026, followed by an annual increase of 31 million euros for civil service salaries. The reform is primarily aimed at ensuring that salaries in the lower pay grades are at least 15% higher than basic welfare support.
### Analysis
In summary, this article highlights the significant impact of a recent ruling by the Constitutional Court in Germany, which mandates a minimum pay increase of 15% for civil servants compared to individuals receiving basic welfare support. The proposed law, championed by Federal Minister of the Interior Nancy Faeser, outlines specific increases in salaries and allowances for civil servants, with potential retroactive payments dating back to 2017. These changes not only benefit current civil servants but also pensioners, ensuring fair compensation and financial stability for this vital segment of the workforce. The financial implications of the proposed law underscore the government’s commitment to uplifting lower pay grades and providing adequate support for civil servants and their families.