Thu, Feb 01, 2018 - Page 10 News List

German workers begin 24-hour strikes

ROUND FIVE:Employers have said they would agree to pay increases over 27 months, but workers are angry about the negotiation tactics and want better work-life balance

Bloomberg

Workers at industrial giants from Siemens AG to Daimler AG are escalating a labor dispute with a series of day-long strikes across Germany that threaten severe disruption to production lines.

Wage negotiations with the IG Metall union, which represents about 3.9 million employees and has already rallied almost 1 million protesters since the start of the year, culminated in 16 hours of tense and ultimately inconclusive talks over the weekend.

Workers from Germany’s northern coastal regions to southern strongholds in Bavaria yesterday halted work in a bid to raise the stakes.

Companies, such as Thyssenkrupp AG and Siemens are among those affected, while strikes beginning in Berlin tomorrow are to hit BMW AG and Daimler’s Mercedes unit. Across Europe’s largest economy, strikes are planned at more than 250 firms over three days.

“It will cause huge damage, because all companies in the long supply chains are affected,” said Oliver Zander, director-general of employers’ group Gesamtmetall. “Twenty-four-hour strikes are irresponsible and endanger jobs.”

The latest round of talks marked the fifth without a deal and negotiations will not resume until the walkouts are over.

IG Metall has been pushing for 6 percent more pay over 12 months for workers in the metals and electrical engineering sectors, as well as subsidized wages for those who reduce their hours to care for children or older family members.

Employers said they would agree on a raise of 6.8 percent over 27 months, but have insisted that subsidized wages for workers on reduced hours would discriminate against those already on flexible contracts who receive no subsidies. They have threatened legal action to offset any damage caused by the stoppages.

“The workers are really angry about the employers’ negotiating tactics,” Joerg Koehlinger, a regional IG Metall leader, told ZDF television yesterday. “Everyone can see how good the economic situation is so we need a significantly higher wage offer and working hours that fit with people’s lives.”

Policymakers from central bankers to government officials are watching the collective bargaining talks closely.

Apart from the disruption from potential factory shutdowns, economists are concerned about the longer-term impact of wage stagnation.

If the region’s most prosperous country cannot significantly lift wages, other nations might face an even greater challenge.

That would complicate the European Central Bank’s efforts to boost inflation and eventually unwind stimulus measures.

One hurdle facing German companies is that they are already grappling with a tight labor market, making it difficult to agree to workers’ requests for more free time. With manufacturing output near the highest level in two decades and orders flowing, a slowdown in production could have severe knock-on effects.

“I hugely regret that after all these long negotiations and intense efforts no result was reached,” Robert Bosch GmbH personnel chief Christoph Kuebel told reporters on Monday.

The 24-hour strikes will cause “significant economic damage,” he said.

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