Germany: 6.3 percent increase for public workers to influence other sectoral negotiations

Who can beat 6.3 percent?  It took 40 successive hours of negotiations for Frank Bsirske, leader of the Verdi union, the representatives of civil service employers, the Federal Minister of the Interior, and Thomas Böhle, President of municipal employers, to reach an agreement.  Nevertheless, it is the first time in 6 years an agreement was reached in the civil service without a strike.  It leads to a 3-stage increase over two years (3.5 percent on March 1, 2012, 1.4 percent on January 1, 2013 and again on August 1, 2013) and affects 2.16 million public employees and quite possibly 685,000 civil servants.  The parties rejoiced with the increase, deemed quite high.  The Minister says public employers went as high as they could and declared, “We want public service staff to be paid decently.”  As for M. Bsirske, who failed to secure 6.3 percent over one year, was still satisfied that “real wages are durably guaranteed for 2012 and 2013.”  Towns, which bear the brunt of the increase as they employ 2 million people and 160,000 civil servants, are not really enthusiastic about this agreement.  “For many towns, the limit of what is bearable isn’t reached, it is exceeded” said Gerd Landsberg, general secretary of the federation of German towns and districts (DStGB).  “We understand that public employees want their share of economic growth, but we’ll have to increase taxes to make up for the billions in additional costs.  Besides, pressure to cut staffing is only going to go up” he warned.  The agreement reached in the civil service is going to have a sizeable influence on the collective negotiations starting in other sectors.  The IG-Metall is asking for a 6.5 percent increase for 3.6 million employees in metal, automotive and machine-tool.  Banking (220,000 employees) and chemistry (550,000) unions want to negotiate 6 percent increases.