Final in the state collective bargaining dispute

Before the possible finale of collective bargaining for the federal states' public services, the German Economic Institute (IW Cologne) warns of the possible consequences of a conclusion.

Final in the state collective bargaining dispute

Before the possible finale of collective bargaining for the federal states' public services, the German Economic Institute (IW Cologne) warns of the possible consequences of a conclusion. After two rounds of negotiations and weeks of warning strikes, employers and employees will meet in Potsdam this Thursday for the possible final round in the collective bargaining dispute. This could lead to a breakthrough.

In an analysis available to the German Press Agency, the employer-related IW now warns of disproportionate increases in lower wage groups. The incomes of low-skilled people have already been raised above average. Now the unions are aiming to “support particularly lower income earners who suffer more from inflation,” according to the IW.

Wage gaps reduced

According to the IW, corresponding flat-rate increases had already led to a “compression of the wage structure” in previous negotiations for the public sector. This means that the wage gap between low-skilled and skilled workers is narrowed. “As a result, qualified jobs become less attractive compared to less qualified ones,” warns the IW in its analysis.

In the current collective bargaining dispute over the income of state employees, the Verdi union and the civil service association dbb are demanding 10.5 percent more wages from the states, but at least 500 euros more. The employers of the Collective Bargaining Association of German States (TdL) reject the demands. According to TdL, the required 500 euros would lead to an increase of up to 23.9 percent in the lower salary groups. Overall, she estimated the possible costs of fully implementing the union's demands at 20.7 billion euros.

Increasing strikes expected

For days now, employees at university hospitals, universities and administrations have been going on warning strikes to defend their interests in the collective bargaining dispute. It is expected that the strikes will increase in intensity until the third and possibly decisive round of negotiations in Potsdam from December 7th to 9th.

Above-average increases

The IW had calculated how salaries in the lower wage groups in the collective agreement for the public service for the federal and local authorities (TVöD) and in the collective agreement for the public service of the states (TV-L) have developed over the years. When TVöD and TV-L were introduced in 2005/2006, the basic salaries of employees in the salary groups examined did not differ across all qualification levels.

To date, employees in the lower wage groups of the states have already received above-average increases, while employees in the upper groups have received below-average increases. Even with the TVöD, employees in the lower wage groups benefited the most, but in the meantime the salaries of the upper groups have increased more than those of the middle ones.

At the federal and local levels, only the most recent agreement in April led to a smaller gap between upper and lower wage groups, according to the IW. “These effects should be avoided in the negotiations on the TV-L, as the wage structure is already more compressed.” The gaps have already narrowed in recent years.

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