Municipal pact for jobs in Wuppertal local administration

In December 1998, the collective bargaining parties in the municipality of Wuppertal, Germany, signed a pact for jobs which foresees the creation of new employment through individual working time reduction, an improved distribution of work and the extension of state-sponsored employment at local level.

On 1 December 1998, the city of Wuppertal and the Public Services, Transport and Traffic Union (Gewerkschaft Öffentliche Dienste, Transport und Verkehr, ÖTV) signed a "framework agreement for a municipal pact for jobs" (Rahmenvertrag über eine kommunales Bündnis für Arbeit) for the municipality's 5,000 or so employees. The central aim of the pact is the creation of new jobs in the local administration through a reduction and improved distribution of working time. In particular, the pact provides for:

• the promotion of part-time work. All employees should have the opportunity to reduce their working time either on a permanent basis or for a certain period of time. The city government promises to utilise all working time thus saved for the creation of new jobs. Furthermore, the municipality will examine the possibility of making additional payments to the pension fund in order to compensate for the loses which part-time workers would have to accept in their pension scheme;

• the promotion of partial retirement. The city government will use the existing collective agreements in the public sector (DE9804258F) to give older employees the opportunity for partial retirement. At the same time, the municipality promises to compensate all partial retirement through the creation of new jobs and, in particular, the transfer of vocational trainees into normal permanent employment;

• a drastic reduction of overtime. The municipality and ÖTV agree that overtime must be reduced, even though many employees want to work overtime and the city administration is used to accepting overtime as a normal part of its current organisational behaviour; and

• the introduction of new working time arrangements and more flexible working time. Both parties agree that the different departments of the municipality should be given more freedom to create their own working time arrangements. The local government, together with the staff council and ÖTV, will elaborate concrete proposals on this point.

In addition, the municipality has agreed to create more vocational training places and to support combined private-public vocational training networks between itself and private enterprises.

The city authority also wants to extend state-sponsored employment. A joint working group of ÖTV, the municipality and the staff council should identify fields of activity in which state-sponsored employment is to be promoted. All employees in public job-creation schemes are to receive the normal payments provided for in the collective agreement for public services. If a position in the municipality is vacant, the possibility of giving the job to an employee in a state-sponsored employment scheme should be examined.

The provisions of the municipal employment pact should also be applied to other subsidiary companies of the city. Furthermore, the pact should become part of a broader local alliance for jobs in Wuppertal, including all collective bargaining parties and other important local organisations.

After the signing of the employment pact,ÖTV expressed its great satisfaction with the document. The union's president, Herbert Mai, called the Wuppertal pact a "model for the whole public services" sector, which makes it clear that although there is a rather problematic budgetary situation in most municipalities, local government still has many opportunities to create employment.

By contrast, the employers' association for the municipal sector (Vereinigung der kommunalen Arbeitgeberverbände, VKA) rejected the employment pact as a "glaring violation of municipal employers' solidarity". The core of the employers' criticisms is the provision of the pact which guarantees employees in state-sponsored employment schemes more or less the full payments which are lay down in the collective agreement for public services. According to the guidelines laid down by the Federal Employment Service (Bundesanstalt für Arbeit), workers in job-creation schemes can be paid as much as 20% below the collectively agreed rate. In the view of the municipal employers, the Wuppertal pact therefore creates an additional financial burden which might diminish the opportunities to create employment at local level. Since the employment pact de facto has the character of a company collective agreement (Haustarifvertrag), it is seen as violating the statute of VKA. VKA is thus now examining whether to exclude the city of Wuppertal from its association.