The supply chain act is meant to secure human and environmental rights along global supply chains. For staff leasing the question is: how is it implemented in Germany – and what do staffing providers and client companies have to bear in mind?
The EU directive and its goals
In 2024 the EU countries voted for a common supply chain act. It addresses risk areas such as forced and child labor, discrimination, breaches of freedom of association and environmental damage. After the original draft was softened, the directive is binding for companies with 1,000 or more employees and €450 million in annual turnover.
The LkSG in Germany
In Germany the Supply Chain Due Diligence Act (LkSG) has applied since 2023. Initially it covered companies with 3,000 or more employees; since 2024 companies with 1,000 or more employees have been required to ensure internationally recognized labor standards in their supply chains. The supply chain covers all products, services and production steps at home and abroad. Compliance is supervised by the Federal Office for Economic Affairs and Export Control (BAFA), which can impose coercive and administrative fines for breaches.
The duties of care
In § 3 the LkSG sets out concrete duties of care for the companies covered:
- Assign internal responsibility and set up risk management.
- Carry out regular risk analyses and publish a policy statement.
- Establish preventive and remedial measures.
- Set up a complaints procedure, and document and report.
What it means for the staff leasing sector
For staff leasing the position is less clear, since the LkSG does not expressly address the particularities of leasing workers. Temporary workers are usually included in the threshold of 1,000 employees if they have already worked at the same client company for more than six months. Staffing providers employing a correspondingly large number of temporary workers also have to comply with the LkSG. BAFA applies the general definition of an employee in § 611a BGB; whether staff leasing is covered in an individual case depends on how the supply relationships are arranged.
Because checking third-party companies is laborious, many companies turn to digital tools. Platforms such as Pactos check staffing providers before a placement and help client companies choose a permitted agency.
Conclusion
The LkSG does not cover staff leasing expressly, but depending on the situation it can bring it within the duties of care. Companies with 1,000 or more employees should make their supply chains transparent, think temporary workers in, and secure the selection of their staffing providers carefully.
Frequently asked questions
From what size does the LkSG apply?
Since 2024 to companies with at least 1,000 employees in Germany (previously 3,000).
Do temporary workers count towards the threshold?
As a rule yes, if they work for more than six months at the same client company.
Who supervises compliance?
The Federal Office for Economic Affairs and Export Control (BAFA); it can impose coercive and administrative fines for breaches.
Is staff leasing expressly covered by the LkSG?
No. The act does not define „employee" specifically for staff leasing; its application depends on the individual case.
- Supply Chain Due Diligence Act (LkSG): gesetze-im-internet.de
- Which parties are involved in staff leasing