Debate on company-level alliances for jobs accompanies coalition talks

In coalition talks following Germany's general election in September 2005, the CDU/CSU and SPD parties had not agreed on a reform of the collective bargaining system by early November. The former propose a statutory clarification of the 'favourability principle' in bargaining, designed to facilitate the conclusion of company-level 'alliances for jobs'. The conservative CDU and CSU are backed by employers’ associations, whereas the SPD and the trade unions strongly oppose any amendment of the Collective Bargaining Act.

On 28 October 2005, representatives of the Christian Democratic Union (Christlich Demokratische Union, CDU), the Christian Social Union (Christlich Soziale Union, CSU) and the Social Democratic Party (Sozialdemokratische Partei Deutschlands, SPD) met in Berlin to discuss labour market issues, such as possible reforms of the collective bargaining system and of employment protection. The meeting aimed to outline the principles of the labour market policy for the coalition government that is expected to come to power shortly. In the beginning of the coalition negotiations on the 10 October 2005, both the CDU/CSU and the SPD committed themselves to sustaining the overarching principle of collective bargaining autonomy. The meeting on Friday revealed, however, that the conservatives and the Social Democrats still differ on the issue of proposed changes to the Collective Bargaining Act (Tarifvertragsgesetz). The SPD strictly opposes any change to the law, whereas the CDU/CSU still favour an alteration of the so-called favourability principle.

The CDU/CSU propose that employers and employees should be able to conclude individual contracts that depart from collective agreements provided that this preserves existing jobs or creates new ones. Such a modification should clarify the conditions when an individual deviation is allowed and, thereby, place company-level alliances for jobs on a legally sound footing. According to the Federal Labour Court (Bundesarbeitsgericht, BAG), the favourability principle does not apply to a reduction of wages and/or an increase in the working time if this is done in order to safeguard jobs. This latter form of exchange does, however, comply with the law if unions and employers’ associations have already agreed to opening clauses that allow for derogations from collective standards. Such settlements exist in several industries. For instance, in the metalworking industry, the relevant settlement, known as the 'Pforzheimer settlement' (DE0403203F) after the place where it was concluded, regulates the use of opening clauses.

The coalition negotiations are currently accompanied by a general debate between unions and employers’ associations on the pros and cons of company-level alliances for jobs and, in addition, on the necessity of amending the Collective Bargaining Act. In a newspaper interview on 27 October 2005, Martin Kannegiesser, president of the employers’ associations for the metal and electrical industry (Gesamtmetall), declared that the opening clause, which will expire in 2007, had safeguard jobs and had increased companies’ investments. In addition, he stated that, although collective agreements on opening clauses were, in general, strictly preferred to a legalislative solution, he would appreciate the latter if the former did not exist or if unions, employers and employers’ associations failed to reach an individual agreement in practice. In this respect, Heribert Joerris, general manager of the German Retail Federation (Hauptverband des Deutschen Einzelhandels, HDE), has called for a statutory clarification; this call has been made in a situation in which the trade union in this sector, the United Services Union (Vereinigte Dienstleistungsgewerkschaft, ver.di), 'has, as yet, refused to negotiate any company-level alliances for jobs'. Mr Joerris fears that, without any opening clauses, tens of thousands of jobs may be at risk as sales in this area are expected to decline.

At a conference of the German Metalworkers’ Union (Industriegewerkschaft Metall, IG Metall) held in Mannheim from 20 to 22 October, Juergen Peters, chair of IG Metall, heavily criticised the calls of Gesamtmetall for a statutory clarification of the favourability principle. Moreover, he stated that the collective bargaining system would, in general, be seriously damaged if more and more companies departed from collective bargaining standards. In addition, the high number of applications that had, so far, been dismissed could indicate that the Pforzheimer settlement was being abused by employers; and could, in fact, endanger its extension beyond 2007. In a radio interview on 30 October, Michael Sommer, chair of the Confederation of German Trade Union (Deutscher Gewerkschaftsbund, DGB), reiterated once again that the unions would strictly oppose any amendment of the Collective Bargaining Act that aimed at paving the way for derogations from collective standards.

This information is made available through the European Industrial Relations Observatory (EIRO), as a service to users of the EIROnline database. EIRO is a project of the European Foundation for the Improvement of Living and Working Conditions. However, this information has been neither edited nor approved by the Foundation, which means that it is not responsible for its content and accuracy. This is the responsibility of the EIRO national centre that originated/provided the information. For details see the "About this record" information in this record.

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