Wage Agreement Germany

Opening clauses allowing the Works Council to negotiate less favourable regulations than those provided in the industry-level agreement to take into account the particular circumstances of their employer are seen as an important means of providing flexibility to the system. A well-known example was the Pforzheim contract signed in 2004 by IG Metall, which was later incorporated into a broader collective agreement on job security. This allows the Works Council to agree on reductions in working time and temporary wages in order to avoid redundancies. Under constant pressure from trade unions, a minimum wage has been in effect in Germany since 1 January 2015, although collective agreements at the sectoral level, which pay less than the minimum wage, remain valid until 1 January 2017. This downward trend is partly due to the fact that employers leave employers` organizations or remain within them without being bound by the agreements they have signed (so-called OT membership), as well as by the creation of new businesses and the disappearance of existing businesses. (New businesses are less often linked to sectoral agreements than existing ones. The decline in relations appears to have stopped in East Germany, where it has remained broadly stable since 2012, but continued in West Germany, where overall coverage of negotiations in 2018 was 4 percentage points lower than in 2012. [7] IAB figures show that in 2011, 23% of jobs related to collective agreements reported that there were opening clauses in the agreements applicable to them. They were most common in manufacturing, where 35% of jobs reported that their agreements made them account. Where they were present, they were often used. A total of 59% of jobs whose agreements contained opening clauses on wages reported that they had used them, and 73% of jobs with opening clauses on working time reported using the flexibility they offered. [4] Many wage agreements contain opening clauses that allow company committees, often with the agreement of trade unions, to take into account the particular circumstances of their business.

For example, in 2018, comparisons of the metallurgical industry, which employs 3.5 million people, have delayed, reduced or completely eliminated the cash payment due in 2019 in some companies facing serious difficulties. And the comparison for the chemical industry in 2018 allowed companies to omit a lump sum payment of EUR 280 when they were able to prove that they were facing particular economic difficulties. Collective bargaining obligation There are no collective bargaining agreements at national level covering the entire German economy and the DGB generally does not have a negotiating mandate.