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- Lecture 1 of 4
- Contexts, Ideology, and Unions
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2
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- Collect papers
- Read chapter on Germany in BLW
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3
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- Canada ‑ bargaining system with substantial gov't intervention and
moving in very different directions from USA ‑ high conflict
- Britain ‑ a laissez faire system becoming less so ‑ moderate
conflict
- Sweden ‑ a highly successful laissez faire system becoming less
laissez faire and with its highly centralized bargaining structure under
strain ‑ low conflict
- France ‑ a legalistic and ideologically fragmented system ‑
moderate conflict
- Italy ‑ a non‑legalistic and ideologically fragmented system
‑ high conflict
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4
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- I‑ Themes
- II‑ Political, Technological, and Economic Contexts of IRHRM
- III‑ Ideology
- IV‑ Workers Organization‑ The Trade Unions
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5
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- Dual System of Bargaining and Codetermination
- Unions represent employees across enterprises
- Codetermination represents employees at enterprise or workplace level
- Highly legalistic
- Low conflict
- Historically unstable ideologically stable system
- Unification with the East still ongoing
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- Political ‑ Population of 82 million 2005
- Political union with East 10/90
- Parliamentary Democracy - Federal system
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- Parties
- CDU/CSU Christian Democrats
- SPD Social Democrats
- Free Democrats‑ liberal/middle of road
- Greens - environmental reformist party
- Party of Democratic Socialism, ex-East German Communist Party
- Proportional representation system makes absolute majority unlikely
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- Among most technologically advanced countries in the world
- Major industrial activities
- Higher percentage labor force in manufacturing than any country in
course
- Population almost totally literate – 99%
- Per capita GDP purchasing power parity 2003
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- Comprehensive social insurance and welfare state
- 2003 taxes
- 2003 government spending
- Highly open economy
- Gender equality
- Child Poverty
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- Satisfactory overall economic performance
- Guest workers
- East grew rapidly in early 1990s
- Unemployment
- Fewer employees working over 40 hours than any country in course
- High wages but not high unit labor costs
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- Workers Organizations - Completely reformist
- Employers - Accept both unions and bargaining
- Unions, employers, and all major political parties have all accepted
collective bargaining
- Differences largely fought out over role of codetermination
- Ideologies seem compatible
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- Unions in the Post WWII Period
- Industrial unionism
- Single major federation‑ again to avoid disunity
- DGB‑ German Trade Union Federation
- Founded 1949 taking 100 existing unions and merging them to 16
- Small Civil Service and Christian Confederations
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- 1994 37% of all employees in unions
- Largest union was metal workers which has lost membership but is now
service workers
- Public employment more organized than private ~75% level
- Long history of promoting women's issues and women as union officers
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- Structure and Finances
- DGB dominant confederation
- Minor Christian confederation and small unaffiliated white collar and
civil service unions compete with DGB unions
- Structure of individual unions
- Each has state (land) or regional branches
- Lowest level is local covering several enterprises
- High degree centralized control
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15
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- Structure and Finances
- Unions & DGB have large technical staffs
- Finances
- Economic Enterprises
- First union‑owned bank established in 1920's
- Unions have financed hundreds of thousands of housing units, own one of
country's major banks, major insurance companies, chain of 5,000
stores, travel agency, publishing co, etc.
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- Consists of 8 autonomous industrial unions
- More than 75% union members affiliated
- Offers affiliates broad scale of services, coordination and arbitration
agency, lobbying and propaganda roles
- Two largest unions IG Metall & Ver.di (public service and transport)
have 1\2 total members of all DGB affiliates
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- Worker Political Organization
- Employer Organization
- Government Organization
- Collective Bargaining
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18
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- Lecture 2 of 4
- Worker Political Organization, Management and Government Organization,
and Collective Bargaining
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19
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- Reading for next class – Finish reading on Germany
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- Technologically advanced, economically highly developed, Parliamentary
Democracy
- No sharp ideological conflicts
- Industrially-based unions which are autonomous and financially powerful
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- I‑ Workers' Organizations‑ Political Parties
- II‑ Management Organization
- III‑ Government Organization
- IV‑ Rulemaking‑ Collective Bargaining
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- Unions and the Social Democratic Party
- Nature of Relationship
- In principle DGB unaffiliated
- Most top SPD officials union members
- Union officials one of the largest occupational groups of SPD
Parliamentarians
- Election time, union officials almost completely mobilized for party
purposes until 2005
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- Unions and the Christian Democrats
- CDU has strong labor wing
- Positions traditionally close to DGB on labor, social, and economic
issues
- Over 1/3 CDU parliamentarians are union members
- Most unions maintain some positions on their executives for CDU
members
- All this helps explain why, after continuous conservative rule in 1969
FRG had among the most progressive labor and social legislation in the
west
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- Employer Associations
- 70% German employers in industry employer associations
- Metal trades employer association key group
- BDA - Confederation of German Employers' Associations - made up of the
state associations
- Contains 70% eligible enterprises with ~80% private sector employees
- Conducts extensive research program, lobbying, provides information and
acts as spokesgroup
- Does no actual bargaining but pools resources for strike defense
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- BDA empowered only to make recommendations to member associations
- Local governments and state governments
- Federal Minister of Interior bargains with unions representing federal
employees
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- Highly legalistic system. Federal
law dominant
- No government sponsored mediation service
- Highly developed system of labor courts
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- Bargaining Structure and Ground rules
- Negotiations industry‑wide on state or regional level between
union and employers' association
- Few large enterprises have their own collective bargaining agreements,
e.g. VW
- Also some company agreements with small firms
- National offices on both sides exert strong influence and national
officers may be present at regional negotiations
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- Bargaining Structure and Ground rules
- DGB can issue only non‑binding guidelines to affiliates
- Employers in associations forbidden to reach agreement on their own
- Bargainers on both sides usually empowered to make binding agreements
- Three basic types of agreements
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- All employers in association covered regardless of how many unionists
they employ
- If association employees are the majority of industry employees,
government can extend agreement terms to cover all employers in industry
- Public employees
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- Social security based on legislation, not negotiation
- Fringes and legally required benefits add about 70% to direct wage costs
- Paid leave
- Some fringes
- Growth of such legislation in areas of safety, work environment, etc.
- Union security agreements illegal
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- Unfair dismissal legislation
- Layoffs
- Government limits length of fixed term employment contracts
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- Bargaining Issues
- Issues of general wage levels, vacation pay, bonuses and job evaluation
systems
- Hours of work
- Began to implement 35 hour week in 1993
- 6 weeks vacation and 10 holidays
- Annual hours shortest in course, about 1400
- Employers now trying to negotiate this back up toward 40
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- IG Metall has frequently been the pattern setter
- Wages‑
- Common use of annual vacation bonus up to one month's pay
- 2000 unions agreed to reduce rate of wage increase by tying wages to
productivity
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- Issue of accommodation of east and west
- Separate negotiations in east
- Some firms have reached (illegal) agreements to pay wages lower than
those in the industry agreements
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- Codetermination in Germany
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- Lecture 3 of 4
- Codetermination
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- Labor politics
- Close relationship of unions to SPD
- Relationship to CDU/CSU
- Highly Organized Employers
- Legalistic Government Intervention
- Bargaining‑ largely industry‑wide at regional level
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- I‑ Codetermination‑ Introduction
- II‑ Rule‑Making ‑ The Works Council
- III‑ Rule-making – Codetermination at Board Level
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- Three different systems
- Coal and steel
- Large companies‑ over 2000 employees
- Small companies and public sector
- Three Levels of Codetermination
- Supervisory Board‑ degree of worker representation
- Management Board‑ Labor Director
- Works councils‑ Every firm with five or more employees
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- Basic Structure and Functions
- Council elected by all workers
- In large companies, some council members do council work full time
- General responsibility for securing adherence to:
- Acts of parliament
- Safety rules
- Collective bargaining agreements
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- "Equal" say with management on "social" issues
- Wage structures, piece rates, incentive systems
- Working hours, overtime, breaks, holiday schedules
- Training, accident prevention, welfare schemes
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- On these issues unresolved differences go to binding arbitration or the
labor court
- On "personnel" issues, hiring, firing, promotion, and
transfers, prior consent of the council must be secured
- On financial and economic matters the council largely restricted to
rights of information and consultation
- No strikes or lockouts in Works Council negotiations
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- In some ways councils and unions quite separate and in some ways they
blend together
- Employers prefer to deal with councils and to let employer associations
deal with unions
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- Closeness of Councils to unions
- 67% council members are unionists and 75% council officers are unionists
- Workers often identify council with union
- Substantive cooperation and coordination between councils and unions
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- Works Constitution Act of 2001
- Increased number of full-time councilors
- Enhanced role in training and employment security
- Enhanced role in protecting environment and combating racial
discrimination
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- Background
- Unions felt full participation in company decision‑making would
help prevent misuse of economic power for political ends
- Share holders hoped participation would head off nationalization
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- Supervisory board appoints members of management board and oversees its
activities
- Makes major financial investment decisions
- Worker representatives on supervisory boards have all the same rights
& responsibilities as other members
- Management Boards
- Conduct day‑to‑day operations
- Labor Director deals with personnel matters
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- Worker representatives on the Supervisory Board have parity - equal
representation plus neutral chair
- Labor Director must be approved by worker representatives on the
Supervisory Board
- Companies trying to escape the full codetermination of coal and steel by
mergers and sluffing activities off to subsidiaries
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- Supervisory Boards
- Parity but one worker representative is a senior manager
- No neutral, ties broken by the stockholder appointed chair
- Labor director
- Appointed by majority of Supervisory Board
- i.e. can be chosen over opposition of worker representatives
- Companies sometimes try to re‑organize to avoid this system
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51
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- Conflict
- Administrative Rules
- Themes and Comparisons
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52
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- Lecture 4 of 4
- Conflict, Administration of the Rules, Summary and Comparisons
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53
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- Reading for next time
- Essay Reminder
- Final Presentation Reminder
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54
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- Three Levels on which codetermination occurs
- Three separate systems
- Relationship of Bargaining to Codetermination
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55
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- I‑ Industrial Conflict
- II‑ Grievance Procedures
- III‑ Summary and Comparisons
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- Legal Regulation
- No statutes but significant restriction by the courts
- Constitution gives wage and salary earners right to strike
- Courts have held conflict legal only when conducted in a labor dispute
- Defensive lockouts legal
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- Union and Employer Tactics
- DGB rules require 75% vote to strike and
approval by national union
- Union strike benefits usually 55‑75% of wages
- Employers won't hire striking workers
- BDA has massive employer assistance funds in case of strikes
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- Level of conflict historically quite low
- Largest strike in post‑war history, metal workers in spring 1984
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- Made 1984 worst strike year in many
- Unions proposed 35‑hour week with no pay cut ‑ designed to
combat unemployment
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- 1999-2003 by far the lowest work time lost of any country in course
- March 2000 series of one-hour warning strikes
- 2002 series of warning strikes by IGMetall
- 2003 strikes over hours in the East
- 2004 General Motors/Opel Dispute
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- Workplace Level
- Little role for union
- Job of works council to assure compliance with the agreement
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- Labor Courts
- Exist at local, regional and federal level, all tri‑partite
- Individual employees can go to labor courts
- Decide all individual and most collective disputes except those over new
terms and conditions
- Though tri‑partite, overwhelming majority of decisions unanimous
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- Dual System of Bargaining and Codetermination
- Unions represent employees across enterprises
- Codetermination represents employees at enterprise or plant level
- Highly legalistic
- Low conflict
- Historically unstable ideologically stable system
- Reunification of east and west
- Workers' Participation coexists here with collective bargaining, but not
without some difficulties
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63
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- Workers can play major, perhaps even equal, role in policy making in a
private enterprise
- Comparisons
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64
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