Germany: Latest working life developments – Q1 2018

Disputes regarding the new government coalition, works council elections, and the new collective agreement signed by IG Metall and Gesamtmetall are the main topics of this article. This country update reports on the latest developments in working life in Germany in the first quarter of 2018.

Tensions over new government coalition 

The year started without a new government in place, but with ongoing disputes among the Christian Democrats (CDU) and the Bavarian Christian Social Union (CSU) on the one side and among the Social Democratic Party (SPD) leaders and the SPD youth organisation (Jusos) on the other. Whilst the CSU sought to gain more influence at the national level, the Jusos campaigned against SPD being part of the new government and for some respite to reconsider the party’s position while under the rule of the opposition leader. The SPD finally opted for a renewed government coalition with CDU/CSU, after two thirds of party members endorsed the position of the SPD leaders in an internal vote. The German Confederation of Trade Unions (DGB) also backed the draft coalition paper [German]. The new grand coalition will differ from the previous one, stressing differences in party politics rather than making compromises, and by engaging more in discussions with the right wing as well as with the left. This is because, on the right, CSU competes with the far right party Alternative for Germany (AfD) which is a new member to the Bundestag, and on the left, SPD will have to fight for more public support after a dramatic decline in the opinion polls. Trade unions are currently debating the latter.

Party politics at workplace level

Party politics moved to the top of the agenda in the workplace, with works council elections taking place in private companies between 1 March and  31 May. Works councils are rare in smaller businesses, but exist in more than 95% of all large companies. All workers, including atypical ones, have the right to vote or to run as a candidate. In recent years, about 62% of elected worker representatives were members of DGB affiliates. This year, the AfD announced that they would put forward party members as candidates, which is an extremely worrying move for many, particularly in eastern Germany. The results of the elections are not yet available.

New agreement in metal sector

With regard to collective bargaining, the union IG Metall and the employers’ organisation Gesamtmetall in Baden-Württemberg reached a new collective agreement after more than 1.5 million IG Metall members participated in warning strikes. The agreement, which was agreed against the background of a good economic outlook and an ongoing policy debate on flexible working hours, serves as a model for other regions. It foresees an above average wage increase of 4.3% from April 2018 and one additional payment of 27.5% of the employer’s monthly wage (to be paid in 2019). Workers with children or caring obligations and shift workers may choose to take time off instead of the extra payment. Moreover, all workers gain the right to switch from full-time to part-time work for two years, reducing their weekly working hours from the agreed 35 hours to 28 hours per week, and to return to full-time work afterwards. In contrast, under certain conditions, the agreement gives employers the right to increase the share of workers on 40-hour a week contracts instead of the standard 35-hour contracts. Both the trade unions  and employers were very satisfied with the result. How the agreement pans out in reality, however, remains to be seen.

Commentary

The upcoming quarter will see the first steps of the new ‘GroKo’ (grand coalition) and the result of the ongoing round of collective bargaining in the public sector.

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