Collective bargaining agreement: 150 years of collective bargaining agreement – those declared dead live longer

Area collective agreements have often been declared dead in Germany. The framework set by trade unions and employers’ associations for working conditions and wage increases, which was supposed to suit a wide variety of companies and millions of employees, seemed too rigid. But even 150 years after the signing of the first collective bargaining agreement for book printers on May 9, 1873 in Leipzig, the agreements have a future – at least that’s what the protagonists and the scientists accompanying them think. The collective bargaining agreement, which has been in crisis for years, is also very popular with the EU Commission and the federal government.

“There are still clear advantages in favor of the sectoral collective agreement – above all, peace and order in the companies,” says Employer President Rainer Dulger, who, in his former position as head of Gesamtmetall, is regularly involved in the world’s largest collective agreement for the German metal and electrical industry around 4 million employees. Stefan Körzell, board member of the German Trade Union Confederation, points out the consequences of uniform competitive conditions: “Companies are then in a qualitative competition: the attempt to achieve short-term cost advantages through wage dumping is put a stop to from the start.”

The most important demands of 1873

30 pfennigs for 1000 typeset letters, a minimum weekly wage of 19.80 marks, a maximum of ten hours’ daily work with two paid breaks every quarter hour – these were the most important demands with which the German book printers’ association went into the labor dispute in January 1873, as Verdi- Historian Hartmut Simon reports. A good 400 typesetters and machine masters laid down their jobs in Leipzig with layoffs, to which the printers responded with a nationwide lockout, which quickly crumbled. There followed a prison sentence for the union leader Richard Härtel and finally negotiations that resulted in a first “delegate tariff”. Although this contained the essential requirements of the printers, it was implemented only hesitantly in the economically difficult years that followed.

Verdi boss Frank Werneke is proud of the historic success of his union’s predecessor organization: “It’s not the colleague with whom I’m in competition for cheap work that’s the enemy, it’s the employer. I have to join forces with others and push through better working conditions together and in solidarity. That was the beginning of the trade union success story.”

Collective bargaining did not become the “heart of collective labor relations” until November 1918 with the “Stinnes-Legien Agreement”, in which the employers’ associations officially recognized the trade unions as negotiating partners for the first time at the beginning of the Weimar Republic. What initially limited the danger of a communist revolution was gradually undermined in the later years of the republic and completely abolished again by the Nazi regime. Only in the Federal Republic of Germany’s Basic Law was there again a firm anchoring of freely negotiated tariffs through freedom of association.

Bargaining issues hardly changed

Lockouts have become rare, but the topics of wage disputes have hardly changed. It is always about higher wages and better working conditions. Instead of the 60 hours per week of the Leipzig book printers, IG Metall is currently targeting the 32 hours, which could also be spread over four instead of six working days as in 1873. Collective bargaining brings clear benefits for employees, says the trade union Böckler Foundation: “Full-time employees in non-collective companies work an average of 54 minutes longer per week and still earn eleven percent less than employees in companies with collective agreements.”

Companies naturally pay more attention to costs and productivity. In recent years, they have often been able to enforce opt-out clauses for companies that are in economic difficulties. The opening of the employers’ associations to members “without a collective bargaining agreement” (OT) annoyed the trade unions. According to former Böckler scientist Reinhard Bispinck, these have led to an “internal erosion of collective bargaining agreements”. It is unacceptable to praise collective bargaining autonomy in Sunday speeches and to lure companies with OT memberships on weekdays.

In fact, only about every fourth company is bound by an in-house or area collective agreement, as the IAB company panel shows. However, many companies voluntarily orientate themselves to the contracts of their industry. “Regional collective agreements are considered a reference value and set important standards for wages and working hours, especially in times of a shortage of workers and skilled workers,” explains Hagen Lesch, the collective bargaining expert at the employer-related Institute for Economic Affairs. He can imagine future area tariffs divided into modules from which small businesses in particular could then choose. However, the trade unions are skeptical about this idea.

Impressive variety

The diversity of collective bargaining agreements collected by the Federal Ministry of Labor is impressive. According to Thorsten Schulten from the Böckler Foundation, almost 10,000 collective wage agreements are stored there, the minority of almost 2400 are area collective agreements concluded by associations.

Also under pressure from the EU, the traffic light coalition wants to increase collective bargaining coverage in Germany, which is stagnating for around 52 percent of employees. This is to be achieved, among other things, by only giving public contracts to companies bound by collective bargaining agreements. Collective agreements should also be easier to declare generally binding. According to Böckler expert Schulten, however, that is not enough. “The goal announced by the EU Commission of an 80 percent collective bargaining coverage can only be achieved with area collective agreements.”