Zagelmeyer, Stefan

Employment is currently the big issue in the European Union. This report describes the recent initiatives known as PECs (pacts for employment and competitiveness) which are a combination of three main elements: competitiveness, employment and partnership.

In the 1990s, Germany has witnessed the emergence of employment alliances and pacts at all levels in order to avoid redundancies, and sometimes even to create new jobs (TN9710201S [1]). These have ranged from national, regional or sectoral tripartite or bipartite employment alliances and pacts, to company-level agreements between management and works councils or trade unions (DE9902293F [2]). [1] www.eurofound.europa.eu/ef/observatories/eurwork/erm/comparative-information/collective-bargaining-on-employment-in-europe [2] www.eurofound.europa.eu/ef/observatories/eurwork/articles/undefined-working-conditions/growing-numbers-of-employment-pacts-at-establishment-level

In April 1999, a new company collective agreement was agreed between the German car producer Volkswagen and the IG Metall metalworkers' trade union for the roughly 100,000 employees at the company's western German production locations. The agreement, which runs for 14 months, includes the following provisions:

On 22 April 1999, after four rounds of negotiations, the construction workers' trade union IG BAU and the construction employers' associations, Hauptverband der Deutschen Bauindustrie (HDI) and Zentralverband des Deutschen Baugewerbes (ZDB), concluded a new collective agreement for the 800,000 or so employees in the west German construction industry. Pay will be increased by 2.9% from 1 April 1999. The holiday bonus will be increased by 30% while, in return, the Christmas bonus will be reduced from 77% to 55% of a month's pay. Minimum wages will be increased by 16% from DEM 16 per hour to DEM 18.50.

On 18 March 1999, the German railway company Deutsche Bahn (DB) concluded two concern-level collective agreements with the GdED (Gewerkschaft der Eisenbahner Deutschlands) railworkers' trade union and the TGM bargaining cartel, which consists of the engine drivers' trade union (Gewerkschaft Deutscher Lokomotivführer, GDL) and the transport workers' trade union GDBA. Both agreements come into force on 1 June 1999 and, innovatively, cover selected enterprises belonging to DB, including those enterprises which become independent as of 1 June 1999 under the second stage of the current reform of German railways. The concern-level framework agreement on working conditions (Konzernrahmentarifvertrag) covers 30 enterprises, while the concern-level pay agreement (Konzernentgelttarifvertrag) covers 10 enterprises.

On 11 February 1999, the employers' association for the private waste-disposal industry (Bundesverband der Deutschen Entsorgungswirtschaft, BDE) and the public sector and transport employees' union (Gewerkschaft Öffentliche Dienste, Transport und Verkehr, ÖTV) concluded a collective agreement for the industry. BDE represents more than 1,000 mostly medium-sized companies, with a total of between 140,000 and 160,000 employees.

In February 1999, the public sector and transport employees' trade union (Gewerkschaft Öffentliche Dienste, Transport und Verkehr, ÖTV) and the German White-Collar Workers' Union (Deutsche Angestelltengewerkschaft, DAG) concluded a package of agreements with the municipal employers' association (Vereinigung der kommunalen Arbeitgeberverbände, VKA). The settlement is the result of three years of negotiations and will cover 110,000 employees in approximately 1,600 public utilities establishments.

In February 1999, the social partners in the German metalworking sector signed new collective agreements for more than 3.2 million employees. The agreements basically provide for a 3.2% pay increase, plus a flat-rate payment of 1% of annual income. While the IG Metall metalworkers' trade union is to a large extent satisfied with the bargaining results, the employers see the costs of the new agreements as being much too high, and state they were accepted only in order to avoid a possible strike (DE9903295F [1]). [1] www.eurofound.europa.eu/ef/observatories/eurwork/articles/undefined/new-collective-agreements-signed-in-metalworking

In Germany, the concept of co-determination [1] refers to two distinct levels and forms of employee participation: co-determination at establishment level by the works council [2]; and co-determination above establishment level, on the supervisory board [3] of companies (DE9806267F [4]). Three different statutes, applying to different sectors of the economy and sizes of company, regulate the latter form of co-determination, as follows: [1] www.eurofound.europa.eu/ef/efemiredictionary/co-determination-2 [2] www.eurofound.europa.eu/ef/efemiredictionary/works-council-2 [3] www.eurofound.europa.eu/ef/efemiredictionary/supervisory-board-1 [4] www.eurofound.europa.eu/ef/observatories/eurwork/articles/undefined-business/report-assesses-co-determination-and-recommends-modernisation

In 1993, the German car producer Volkswagen AG experienced a dramatic decline in automobile purchases, threatening to lead to mass redundancies. Thus, in December 1993, VW and the IG Metall metalworkers' trade union concluded a "collective agreement to secure production locations and employment" (Tarifvertrag zur Sicherung der Standorte und der Beschäftigung der Arbeitnehmerinnen und Arbeitnehmer bei der Volkswagen AG).