Germany Reveals Plan to Combat Exploitation of Foreign Workers and Abuse of Social Benefits

Author: Amy Asubonteng

October 1, 2026

HRRC supports the German Labour Ministry, advocating for adequate housing and condemning the extreme commodification of housing and the exploitation of social benefits at the expense of migrant workers.

Apartment complex, Munich, Germany [Image credit: Marcel Strauß/Unsplash]

The German Labor Minister, Bärbel Bas, revealed a plan to combat the exploitation of foreign workers and subsequent abuse of social benefits. On Wednesday, September 16, Bas confirmed Germany’s plans to address such matters, with means to still preserve the European Union’s Principle of Free Movement. The European Union’s Principle of Free Movement ensures that any citizen of a European Union (EU) member-state can live in another EU country with only a valid identity card or passport for up to three months, or longer if they fulfill certain conditions depending on their residency status (e.g., work, student). This rule allows EU citizens to work across borders in other EU countries. This is a fundamental need for Germany’s economy, which depends on skilled foreigners to make up for labor shortages.

Bas claimed the Principle of Free Movement rule has been exploited by crime groups through the abuse of immigrant workers and organized fraud. Commercial criminal networks recruit vulnerable EU citizens, predominantly from southeastern European nations like Romania and Bulgaria, and bring them to Germany for employment. These employees are then used to siphon public funds for the criminal networks. Since 2022, more than 1,500 cases of organized benefit fraud involving EU citizens have been documented by German jobcenters. 

The German government created a 10-point action plan to address practices of organized benefit fraud. One part of the plan focuses on the exploitation of immigrants through inadequate, overcrowded housing. Municipalities would be responsible for intervening when immigrants are charged excessively for housing in poor condition. Employers would be prohibited from covering costs for housing, as that would be considered to be part of the exploitative business model: using poorly maintained properties in schemes to target vulnerable, often foreign, workers by charging them more than the standard value. Local governments are encouraged to issue mandatory repair orders, ban certain properties from occupation, and seize properties from landlords that fail to update the housing to modern standards. Artificial intelligence (AI) will be utilized on a federal level to detect suspicious payment clusters. 

In addition, the plan details how federal and economic entities, such as the local police department or jobcenters, will improve information sharing, resulting in more in-depth inspections of potential abuses to better detect and stop fraudulent claims. Furthermore, employers could face liability if caught participating in the exploitation. Another key implementation of the 10-step plan would restrict access to welfare payments for EU migrants engaged in negligible employment, limiting organized employment fraud incentives. 

---

Glossary

• Adequate: good enough : of a quality that is good or acceptable 

• Artificial intelligence: the capability of computer systems or algorithms to imitate intelligent human behavior 

• Commodity: something that is bought and sold 

• Commodify: to treat (something that cannot be owned or that everyone has a right to) like a product that can be bought and sold 

• Documents: an official paper, book, or electronic file that gives information about something, or that can be used as evidence or proof of something 

• Exploit: to use (someone or something) in a way that helps you unfairly 

• Fraud: an act, expression, omission, or concealment calculated to induce another to part with something of value or to surrender a legal right 

• Federal: of or constituting a form of government in which power is distributed between a central authority and a number of constituent territorial units 

• Inadequate: not adequate : not enough or good enough  

• Intervene: to interfere with the outcome or course especially of a condition or process (as to prevent harm or improve functioning) 

• Jobcenter: employment office 

• Liability: the quality or state of being liable 

• Municipalities: a city or town that has its own government to deal with local problems 

• Negligible: very small or unimportant 

• Siphon: to take and use (something, such as money) for your own purpose 

• Vulnerable: capable of being easily hurt or harmed physically, mentally, or emotionally 

---

References

1. Germany unveils plan to combat social-benefit fraud and worker exploitation – GermanCorrespondent.com 

2. Germany unveils ten-point plan to combat organized welfare fraud and housing exploitation · Pollar 

3. Germany to tackle welfare fraud through new 10-point plan 

4. Germany to crack down on worker exploitation, social benefit abuse | MarketScreener 

5. Germany to crack down on worker exploitation, social benefit abuse - AOL 

6. Germany to crack down on worker exploitation, social benefit abuse | Reuters 

7. Benefits in Germany: types, payment amounts, eligibility and how to apply 

8. Free movement and residence - European Commission