Common pay system agreed for all metalworking employees

A new collective agreement signed in the Austrian metalworking industry in November 2004 provides for a pay increase of 2.5% and introduces for the first time a common pay system for blue- and white-collar workers. Both employee groups will thus be treated equally in terms of job classification and automatic pay increments. Due to metalworking’s pattern-setting role in bargaining, this agreement may trigger negotiations on pay harmonisation in other sectors.

After 23 hours of unbroken and intense negotiations, on 4 November 2004 the sectoral social partners concluded a new collective agreement for some 119,000 blue-collar and 74,000 white-collar workers in the metalworking industry. This sector traditionally opens Austria's annual autumn bargaining round and plays a pattern-setting role in the overall bargaining process (AT0210202F). According to the bargaining parties involved - the various branch subunits of the Chamber of the Economy (Wirtschaftskammer Österreich, WKÖ) on the employers’ side and the blue-collar Metalworking and Textiles Union (Gewerkschaft Metall-Textil, GMT) and white-collar Union of Salaried Employees (Gewerkschaft der Privatangestellten, GPA) on the employees’ side - the negotiations proved to be extraordinarily difficult. This was because the trade unions insisted on the introduction of a new common pay system applying to the sector’s blue- and white-collar workers without, at the same time, introducing more flexible working hours schemes, as demanded by the employers (AT0410202F). The unions’ goal was eventually reached, albeit in exchange with a quite moderate pay increase of only 2.5% in both minimum and actual wages - and without a provision for a company-level 'distribution option' (as laid down in earlier agreements - AT0111229N).

Under the agreed new pay system, the metalworking sector will be covered by a new job-classification system and a new pay increments scheme. The new classification system specifies 11 newly designed grades covering both blue-collar and white-collar workers, thus replacing the 'old', different classification criteria for the two employee groups, which are perceived as imprecise and unfair. The new increments scheme provides for five automatic increments for both employee groups relating to wage/salary levels within each of the 11 new grades. Accordingly, for each employee there will be two collectively fixed and three variable increments (the latter to be agreed individually between management and works council at company level) within a period of 12 years of continuous employment. The five increments will become due after two, four, six, nine and 12 years of employment in the same grade. The new scheme will come into effect on 1 November 2005.

The new common pay system for the overall metalworking sector to a great extent resembles that collectively agreed in the electrical and electronics sector in December 2003, which was a 'milestone' settlement in terms of pay harmonisation for blue- and white-collar workers (AT0402202F). Since bargaining in the metalworking industry informally sets a guiding framework for negotiations in all other sectors, the new agreement may act as a signal for the other sectors’ collective bargaining parties to start negotiations on pay harmonisation.

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