Unions and workers protest against plan to raise retirement age

The federal government’s plans to increase the statutory retirement age to 67 years have met with a series of protests from workers. Since December 2006, approximately 250,000 employees have participated in nationwise demonstrations against the government’s proposals to raise the retirement age. While trade unions support employees’ right to protest, employer organisations highlight the risk that such protests pose to collective bargaining autonomy.

In November 2006, the coalition partners of the federal government agreed to the gradual increase in the statutory retirement age from 65 years to 67 years between 2012 and 2029. In future, only employees who have contributed to the statutory pension insurance for 45 years will be entitled to receive the full pension at 65 years of age. Others will either have to work until they reach 67 years of age or be prepared to face pension cuts under certain circumstances (DE0612039I). To become binding law, the federal government’s reform plan will, on 9 March 2007, have to be approved by the German parliament (Bundestag).

Trade union position

The German Metalworkers’ Union (Industriegewerkschaft Metall, IG Metall) criticises the proposed increase in the statutory retirement age. In December 2006, in an article on the retirement age (in German), IG Metall contended that this increase would lead to pension cuts for those employees who have not contributed to the statutory pension insurance for 45 years. The trade union argues that, because of persistently high unemployment rates and because of the need of some employees to take early retirement as a result of health problems, employees are unlikely to be able to work for a continuous 45 years.

IG Metall Chair, Jürgen Peters, proclaimed that ‘the ignorance of the grand coalition forces people onto the streets’. Furthermore, in a press release (in German), Mr Peters called for a modification of the legal reform. He argued that flexible retirement arrangements are needed and that a prolongation of employees’ working lives is not desirable. IG Metall believes that employees who contributed for 40 years to the statutory pension scheme should not face any pension cuts and should be allowed to retire at 65 years of age.

Following the announcement of proposals to raise the legal retirement age, IG Metall started to organise demonstrations and campaigns against ‘Retirement at 67’ (Rente mit 67). On 31 January 2007, the trade union announced that about 27,000 Volkswagen employees, approximately 30,000 Audi employees and a further 6,700 employees from Bosch had participated in demonstrations on that day. According to a further press release (in German), IG Metall confirmed that about 250,000 employees have participated in demonstrations against the government’s decision since December 2006; these protests have taken place on work days during working time.

Employer position

The Chair of the Association for the Metal and Electrical Industry Rhineland-Rhinehessen (Verband der Metall- und Elektroindustrie Rheinland-Rheinhessen, VEM), Franz-Josef Mäckler, announced that those employees who had stopped working in response to IG Metall’s calls to join organised demonstrations were in breach of existing labour laws. He stressed that work stoppages that were designed to influence current legislative procedures would not be tolerated by employers.

Furthermore, Mr Mäckler claimed IG Metall’s statement that everybody has the right to freedom of opinion to be hypocritical. He agreed that employees certainly have a right to voice their opinions. However, he emphasised that they should not, as a result, be entitled to ‘stay away from work or leave their workplaces’ without permission. Moreover, in a statement to the press (in German), Mr Mäckler argued that the discussion of political issues belongs in the arena of public debate, media and the German parliament.

The Chair of the Employers’ Association for the Metal and Electrical Industry (Arbeitgeberverbände der Metall- und Elektroindustrie, Gesamtmetall), Martin Kannegiesser, stressed that the statutory pension scheme would have to be adjusted due to demographic trends such as an ageing society. He thus strongly objected to the protests. In a press statement (in German), he supported the right of trade unions to express their views on pressing social or political issues, but argued that the extension of politically motivated protests by employees to the establishment level would undermine collective bargaining autonomy.

Commentary

Article 9 of the Basic Law (182Kb PDF) (German constitution) stipulates that the social partners are entitled to freedom of association. Therefore, trade unions and employer organisations enjoy the right to regulate their conflicting interests among themselves. Employees are entitled to stop work and conduct strikes if those strikes are organised by trade unions. Employers, in return, are entitled to lockout their employees. However, employees’ right to strike and employers’ right to lockout are linked either to issues that are usually negotiated through collective bargaining or to the enforcement of settlements that have already been concluded.

On the other hand, political strikes or demonstrations have been deemed unlawful by the Federal Labour Court (Bundesarbeitsgericht). Furthermore, if work stoppages or strike actions are used as an attempt to force through changes to proposed legislation, as the protests against the federal government’s plan to raise the legal retirement age could be construed, this might also be considered as unlawful.

Sandra Vogel, Cologne Institute for Economic Research, IW Köln

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