Germany: Developments in working life – Q1 2016
Trade union membership growth, the draft bill on temporary agency work and elections in three federal states are the main topics of interest in this article. This country update reports on the latest developments in working life in Germany in the first quarter of 2016.
There was little activity in industrial relations in Quarter 1 of 2016, but there were intense discussions between political parties. The political climate was overshadowed by heated debates on the government’s policy on refugees and asylum-seekers. The ruling Christian Democrats were criticised by their sister party, the Christian Social Union, in Bavaria (CSU) and attacked by right-wing populists, while the Confederation of German Trade Unions (DGB) and the The Confederation of German Employers' Associations (BDA) rallied together in support of the Chancellor’s refugee policy. A draft bill on temporary agency work – demanded by the trade unions and criticised by the employers – was stopped before it even got to the federal cabinet. There were no major industrial conflicts because the 2016 bargaining rounds started in late March.
The economy continued to be robust. The Institute for Employment Research (IAB) estimates that the first quarter’s real growth in GDP will surpass the +0.3% of the previous quarter. This is attributed to private and public domestic demand. However, the IAB also expects a slower development throughout the rest of 2016 due to a slowing economy in major export markets, dwindling oil prices and global insecurities. The Federal Employment Agency reports positive developments in the labour market. Unemployment decreased in Q1 and in March stood at 6.5% (PDF). At the same time, the number of people in jobs eligible to pay social security contributions increased and, in some sectors and regions, labour is still in demand.
Positive union membership trends
The trade union confederations report an overall positive membership trend in 2015. The DGB saw a decline of only 0.15% and in December 2015 had 6,095,513 members. Losses were reported in some manufacturing sectors, in construction and rail transport while the small teachers' unions and the police union saw significant gains in membership. DGB's two largest affiliates both did well in 2015. The United Services Union ver.di organised activities and formulated a strategy to campaign for increased wages in female-dominated sectors. Ver.di had very moderate membership losses, with two million members by the end of the year. The four-year trend of increasing membership for the German Metalworkers Union (IG Metall) stabilised at 2.7 million members. The union also prepared for the upcoming 2016 bargaining round, and announced a plan for significant investment, until 2025, in activities to organise workers in the digital economy.
Germany’s second largest trade union confederation, the German Civil Service Federation (dbb), represents 43 trade unions whose members work mostly in the public sector. About two-thirds of its members are civil servants who are not allowed to engage in collective bargaining or industrial action. However, in 2015, the number of dbb trade union members increased by 1.3%. In common with the growth of the teacher and police unions affiliated to the DGB, these gains mirror growing demands on the part of public sector employees and workers in privatised companies.
Over the winter, no decisive new developments occurred in German industrial relations. Ver.di continued to push the US company Amazon at the bargaining table and also tried to reach a new agreement with Deutsche Telekom. Major sectoral bargaining rounds began in March. Negotiations between ver.di and the Association of Public Employers (VKA) are likely to become confrontational. The German Metalworkers’ Union has tabled a wage claim of 5% (for 12 months); the claim is strongly rejected by German employers.
Draft bill on temporary agency work halted
No new labour-related legislation was passed during the period. Rather surprisingly, the Federal Labour Minister's second draft bill on temporary agency work and service contracts was halted by the Chancellery before reaching the federal cabinet for debate. In early December, a first draft was rejected and the revised version had been expected to be passed by Parliament in spring. However, there was still opposition from the employers’ side who argued that any new administrative burden should be avoided given the need to focus on the labour market integration of refugees.
Länder elections stir up political climate
The Chancellor relies on the support of the employer organisations and trade unions for the government’s refugee policy. The policy is criticised by the CSU and is strongly attacked by the right-wing populist party Alternative for Germany (AfD). In Q1 any political debates were clouded by the elections due to be held in three federal states (Länder) on 13 March 2016 and fears of the AfD's growing support. This party formed in the wake of the financial crisis in 2013 as a Eurosceptic party and now takes a right-wing stance against refugees and asylum-seekers. The party won as much as 15% of the vote in some west German states and 24% in the east German state of Saxony-Anhalt. It did not secure enough votes to be included in any of the three new government coalitions, however. But all, surprisingly, have new compositions: Baden-Württemberg will be ruled by the Greens and The Christian Democratic Union of Germany (CDU), Rhineland-Palatine by the Social Democratic Party of Germany (SPD), the Greens and the Free Democratic Party (FDP), and Saxony Anhalt by CDU, SPD and the Greens.
Against this development, other topics discussed in Q1 such as the working conditions of commuters; future scenarios on digitisation, industry 4.0, and their impact on working life in Germany; or companies’ and employees’ engagement in further training, were of minor importance.