Bremen authorities reported over €16 million in damages stemming from undeclared perform in 2025, a figure encompassing unpaid taxes, social security contributions, and minimum wages. The findings, released by customs officials on February 22, 2026, highlight the ongoing challenge of combating the shadow economy within the city-state. Nearly 3,500 criminal proceedings were initiated as a result of investigations into illegal employment practices.
The crackdown on Germany’s shadow economy, which reached a new high, is a key focus for federal and state authorities. The Bremen customs office specifically targeted sectors known to be vulnerable to exploitation, including construction, logistics, hairdressing, cosmetics, and the hospitality industry.
According to the official report, a total of approximately €660,000 in fines were levied, alongside prison sentences totaling over 24 years. Around €830,000 in penalty payments were issued. Approximately 370 employer audits were conducted throughout the year.
The investigations revealed a pattern of employers deliberately avoiding legal obligations to reduce labor costs. This practice not only deprives the state of revenue but as well undermines fair competition and exploits workers, often leaving them without adequate social protections. The German Zoll (customs) plays a crucial role in enforcing labor laws and ensuring compliance with minimum wage regulations.
The focus on specific industries reflects a strategic approach to tackling undeclared work. The construction sector, for example, is often characterized by a high proportion of temporary workers and subcontractors, making it susceptible to illegal practices. Similarly, the logistics industry, with its tight margins and demand for rapid turnaround times, can create incentives for employers to cut corners on labor standards. The hospitality sector, known for high employee turnover, also presents challenges for enforcement.
These findings come amid broader concerns about labor market trends in Germany and the enforcement of minimum wage laws. Recent reports suggest that thousands of employers may have failed to pay the legally mandated minimum wage in 2025, further exacerbating the problem of wage theft.
The Bremen customs office’s efforts are part of a larger national initiative to combat undeclared work and protect the rights of employees. Authorities are increasingly utilizing data analysis and targeted inspections to identify and prosecute offenders. The German Press Agency (dpa), founded in 1949, plays a vital role in disseminating information about these enforcement actions and raising public awareness of the issue.
Looking ahead, authorities are expected to continue prioritizing the fight against undeclared work, with a focus on strengthening enforcement mechanisms and increasing penalties for non-compliance. Further investigations are planned in vulnerable sectors, and collaboration with other agencies will be crucial to effectively address this complex challenge. The long-term impact of these efforts will depend on sustained commitment and a comprehensive approach to tackling the root causes of the shadow economy.
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