Household and personal services

Because ever more women have been entering paid employment over the last 20 years, unpaid work in the household and family has increasingly been given over to providers of household and personal services, not only in Germany, but also in other industrialized nations and fast-growing economic zones such as Singapore and Hong Kong. This is due on the one hand to the still slight participation of men in unpaid work in the household and family, resulting in a double burden on women who work, and on the other hand, the ageing of the population is resulting in increased demand for nursing care services and household help to look after old and ill people.

In Germany, just under three million households regularly employed cleaners or household help in 2001, of which, however, less than 40,000 were employed on a basis on which social insurance contributions were payable without limitation. It has been calculated in the course of a study by the International Monetary Fund (IMF) that the share of household services in the gross domestic product in Germany in the late Nineties was 5,500 million DM.

One chance for increased shedding of unpaid work in the household and family is the disburdening of certain women who are able to take up paid employment; another is in the creation of new jobs. However, the manner in which work in the household and family is given over and to whom should be looked at in a critical way: both the people who use household and personal services and the people who provide them are almost exclusively women. While the employers mostly belong to the statistical middle class, the household helps are mostly immigrants. Gender specific division of labor and the lack of participation by men in work in the household and family stay the same as ever. Moreover, this can even result in a division of labor among women along ethnic and class lines.

Furthermore, employment conditions in the area of household and personal services are often precarious. Most employment is illegal, and many workers are moreover illegal immigrants. Overall, there is a great need of regulation. Work in household and personal services is undervalued despite the high level of demands made by the work and the great social relevance. This is due to the gender attribution of the work. Skills needed for cleaning, cooking, childcare and so on are assumed to be typically female qualities and are thus not accorded the recognition accorded to other skills and are consequently poorly paid.

Regulations to promote legal employment in the area of household services:

Since the late Eighties, there have been various attempts to extend legal employment in the area of household services. These attempts have ranged from household checks to tax allowances and reductions in social insurance contributions to service pools offering household services on the legal market.
Since April 2003, private households using household services are obliged to pay only 12 % in contributions instead of the 25 % usual for minijobs. The worker does not have to pay any tax and deductions for a minijob earning up to € 400 per month. Furthermore, the legal employment of persons in the household segment is given a tax boost: if a person is taken on in the household segment on the basis of a minijob, 10 % of the wages (up to € 510 p.a.) can be deducted from tax, and if the worker is obtained via an agency or service pool, this rises to 20 % of the wages (€ 600 p.a.). If a worker is taken on in the household services segment on the basis of employment subject to social insurance contributions which is more than merely a low-paid job, 12 % (up to € 2400 p.a.) can be deducted from tax (Section 35a of the Income Tax Act).

In additional to these regulations, there have been various attempts in recent years to create models whereby so-called service pools have been created which were supposed to concentrate both the demand and the supply for household services. This was intended to contribute not only to a shift of household services to the official market but also a professionalization of household services. Moreover, setting up service pools was supposed to enable the creation of full- and part-time employment subject to social insurance contributions for male and female workers who offer household services, often as low-earning jobs. Through the use of household services via service pools, all concerned were supposed to reap advantages. The private household was supposed to be relieved of its role as employer, while the household help is offered a full- or part-time job with social insurance coverage, including holiday, sick pay, etc. The service pools were subsidized in all model projects, and it was only on this basis that they were able to offer household services at prices which created demand in the marketplace.

While tax boosts support legal employment in the area of household services or promotion in the form of a reduction in social insurance contributions supports a widening of the low-earning job base, only service pools can create full- and part-time employment subject to social insurance contributions on a large scale. However, tax breaks and reductions in social insurance contributions offer the possibility for a legalization of existing employment relationships in the informal market.
Professionalization of household services would be desirable overall, because, among other things, this would result in an upgrading in the value of work in the household and family.