German wage talks end with compromise

Steel employers and union IG Metall have agreed terms in the periodical wage negotiations for the northwest German steel industry, which started only a few weeks earlier.

The agreement came comparably fast, with only very few short token strikes occurring at some downstream plants. The union originally launched talks with a wage increase claim of 4%, which the employers’ side immediately dismissed. The figure and the initial exchange of blows that follows is quite common in every round.

The agreement struck on Saturday contains no nominal percentage increase. Instead, all workers will be entitled to a uniform one-off “Covid-19 bonus” of €1,000 ($1,118), paid in three tranches between June and February next year. Alternatively, it may not be paid out at all, but transformed into time off.

This measure is relatively new and must be seen against the background of crisis periods, due to the pandemic or economic downturns, Kallanish learns from the union. Workers are asked to take time off during times of low utilisation, which in the long run helps to avoid lay-offs. During times of regular work-load, the bonus is meant to be paid out, though.

Prior to the negotiations, the union stated that it is fully aware of the tension the industry faces because of the pandemic, despite the recent surge in steel prices, However, it noted that purchasing power for consumers must be supported, too, to avoid an economic downward spiral. At an early stage already, it brought up the option of cutting back on working hours to preserve jobs.

The agreement struck now applies to 70,000 staff at major mills in western and northern Germany. This week, negotiations will be held for the eastern German mills. Normally, other regions adopt the agreement struck for the northwest.

Christian Koehl Germany