General election results fuel debate between social partners

The federal elections held on 27 September 2009 brought to an end the previous coalition government between the conservatives and social democrats. The conservatives, who remain the largest group in parliament, have formed a new centre-right coalition government with the liberals. The latter have called for fundamental reforms, such as tax cuts and higher thresholds for employment protection. The social partners are divided about the election outcome.

The last general parliamentary election in Germany, which was held on 27 September 2009, brought to an end the incumbent coalition government between the Social Democratic Party of Germany (Sozialdemokratische Partei Deutschlands, SPD) and the conservative alliance of the Christian Democratic Union (Christliche Demokratische Union, CDU) and its Bavarian associate, the Christian Social Union (Christlich-Soziale Union, CSU) (DE0510201N). The following table outlines the election results, as well as the distribution of seats in the German parliament (Bundestag).

General parliamentary election results, 2005 and 2009
Party No. of seats in 2005 Votes in 2005 (%) No. of seats in 2009 Votes in 2009 (%)
CDU/CSU 226 35.2 239 33.8
SPD 222 34.2 146 23.0
FDP 61 9.8 93 14.6
Left Party (Die Linke) 54 8.7 76 11.9
Alliance 90 (Bündnis 90) /Green Party (Die Grünen) 51 8.1 68 10.7
Others - 3.9 - 6.0

Source: Federal Returning Officer (Bundeswahlleiter), 2009

Having together achieved a clear majority, the CDU/CSU and the liberal Free Democratic Party (Freie Demokratische Partei, FDP) formed a new coalition government. It should be noted that in the run up to the election the FDP called for fundamental reforms, such as increasing the thresholds for dismissal protection. The FDP had suggested applying dismissal protection only to companies employing more than 20 workers and only to workers employed for at least two years. Further reform proposals made by the liberal party included tax reforms and the introduction of new options for dismissal clauses in employment contracts. The social partners are currently debating the election outcome and its possible consequences for industrial relations. They are divided in their views.

Position of social partners

Following the federal parliamentary elections, in a press statement (in German) on 30 September the German Confederation of Employers’ Associations (Bundesvereinigung der Deutschen Arbeitgeberverbände, BDA) called on the new government to disburden both employers and employees in the medium term. BDA mentioned several measures which could help to achieve this goal, including a simpler and fairer tax regime and structural changes in the social security system. BDA also underlined that the highest priority was maintaining companies’ liquidity in times of economic crisis, since only companies in a stable financial situation were able to create new jobs. In this context, BDA’s Chair, Dieter Hundt, warned of the dangers of a comprehensive credit crunch. Finally, BDA called on the new centre-right liberal government to lower public sector debt.

The General Manager of the German Chambers of Industry and Commerce (Deutscher Industrie- und Handelskammertag, DIHK), Martin Wansleben, called on the new government to introduce growth-oriented reform policies, including changes to the tax system, particularly to inheritance and business taxes. DIHK also highlighted the necessity of safeguarding credit facilities and achieving greater flexibility in the labour market.

On 5 October 2009, the daily newspaper Die Welt quoted the response of the Vice Chair of the Confederation of German Trade Unions (Deutscher Gewerkschaftsbund, DGB), Ingrid Sehrbrock. She stated that the trade unions would not accept changes to the employment protection legislation, arguing that protection from dismissal played only a subordinate role in recruitment decisions. The economic situation of companies is the crucial factor in this regard.

DGB Board Member, Annelie Buntenbach, urged the new government to support the Federal Employment Agency (Bundesagentur für Arbeit, BA). The debts accumulated by the statutory unemployment insurance in the wake of the global economic crisis have to be financed by federal funds. Ms Buntenbach also advised against a more flexible employment law as proposed by the FDP.

Sandra Vogel, Cologne Institute for Economic Research (IW Köln)

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