German Employers And Unions Clashing Anew | Germany| News and in-depth reporting from Berlin and beyond | DW | 07.02.2003
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German Employers And Unions Clashing Anew

Germany's employers are offering a plan that they say will help create desperately needed jobs. But the country's unions react with a wave of protest that may sink a key element of the government's employment push.


Ready for conflict: German unions can flex their muscles, and the country's leaders know it.

German Chancellor Gerhard Schröder has had better weeks.

The troubles got rolling with an election disaster his party, the Social Democrats, suffered in two states on Sunday. And the week cascaded downhill from there. On Wednesday, the country learned that more than 4.6 million people were out of work in January -- 1.1 million more than the goal Schröder once set for his government. And then on Thursday, he watched one potential means of staunching the flow of citizens into joblessness collapse.

The potential solution is called Alliance for Jobs. It is a forum at which leading members of Germany's business community, labor unions and government have met off and on again in an attempt to find ways to create jobs.

Dieter Hundt

Dieter Hundt

The latest explosion in the tense relationship between Germany's employers and trade unions was set off Thursday by Dieter Hundt, who leads a major employer group, the Confederation of German Employers' Associations.

Employers seeking consensus

Hundt presented a six-point plan designed to promote "a consensus between the government, unions and employers that would get us out of our crisis in growth."

Without such changes, he said, "I am afraid that we will have five million jobless, fewer apprentice training programs, and higher deficits in government budgets and social services."

In the plan, Hundt suggested that the employers and union make a deal. The employers would guarantee a training position to every qualified young person. In return, the employers asked the unions to accept looser rules on one of their most cherished benefits -- protection against layoffs. Hundt proposed that the rules would apply to companies with more than 20 employers and take effect once a worker had been with a company for three years. Currently, those rules apply to companies with more than five workers.

Plan produces an eruption

The suggestions produced conflict instead of consensus.

Michael Sommer

Michael Sommer

Michael Sommer, the leader of the German Trade Union Federation, stepped before the media on Thursday and rejected any continuation of the Alliance for Jobs under such circumstances. "We will not allow these protections to be trampled on," Sommer said. "There is not one credible study that shows such changes would create jobs."

Sommer then pointed his finger at Schröder. "In this truly serious situation, Chancellor Gerhard Schröder must decide: If he follows a path of socially just modernization, then he will win back the trust he has lost. If he follows the preachers of laissez-faire principles, he will not achieve this goal and free our country from the stranglehold of unemployment."

Employers, unions urged to talk

Following the angry exchange of words, the country's economics and labor minister appealed to both sides to return to the talks."I expect everyone in the debate to be ready to jump over their own shadow," Wolfgang Clement, a member of Schröder's Social Democratic Party, said Friday.

A high-ranking member of Clement's ministry, Rezzo Schlauch, passed a message to the unions in a newspaper interview he gave. With the jobless total having climbed past 4.6 million, Schlauch said the unions "would not be fulfilling their position in society if they declare something off-limits" in the debate.

The union's decision to abandon the alliance was greeted with relief by one of Germany's biggest newspapers. "On Feb. 2, 2003, the unions finally buried the Alliance for Jobs," an editorial in the Frankfurter Allgemeine Zeitung said. "Finally, they have put this empty media spectacle back where it belongs: in the desk drawer of the union functionaries."

End to alliance urged

Harmen Lehment of the Kiel Institue for World Economics, suggested in an interview with DW-WORLD that Schröder also would be better off if he dropped the idea of the alliance altogether.

"The talks don't appear to be very promising," Lehment said Friday. He acknowledged that such an approach would produce a short-term battle with Germany's unions. "But right now there are no elections scheduled, and the government can forge ahead," he said.

He suggested that one of the issues the government should address by itself was the very issue that Sommer was defending -- the legal protections set up to prevent layoffs. "These protections act as a break on job creation," Lehment said. Under the current laws, companies have grown uncertain about the whole issue of layoffs, he said. And the courts have added to this uncertainty by frequently granting large severance payments to employees who have challenged their layoff, he said.

By going its own way, the government could help eliminate some of this uncertainty, Lehment said. "It could create a clear picture for companies about the costs companies face when they have to lay off workers," Lehment said.

In an interview earlier this week, Schröder said he would consider loosening legal protections preventing layoffs, but only if employers could deliver a reasonable number of new jobs.

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