Wage Hikes Slated for Public Employees Amid Economic Recession | Business| Economy and finance news from a German perspective | DW | 01.03.2009
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Wage Hikes Slated for Public Employees Amid Economic Recession

Despite the financial crisis and job cuts in the private sector, hundreds of thousands of German government employees received 5 percent pay hikes. The deal reached Sunday, March 1, averted the danger of more wide-spread

A hand puts a punch card into a clock

Some government employees will get more cash for punching in

Negotiators representing Germany's 16 state governments consented Sunday to pay hikes of about 5 percent for government employees, averting more of the strikes that have disrupted education and other public services for weeks.

The deal was reached after three earlier rounds of negotiations failed to end in an agreement on how to minimize inequality among staff in road maintenance offices, statistics bureaus, clinics, police stations and other public institutions.

If union members accept the deal announced in Potsdam, near Berlin, by Lower Saxony Finance Minister Hartmut Moellring and Verdi trade union leader Frank Bsirske, some 700,000 non-tenured employees would receive staged raises effective this week.

The terms are likely to be extended to hundreds of thousands of other German public servants who work alongside unionized staff.

One of the state premiers, Peter Harry Carstensen of Schleswig- Holstein, said Sunday he would grant the same rises to those state servants who enjoy tenure but lack the legal right to unionize and strike.

German union have come under fire for seeking large wage increases during times of economic distress in Europe's largest economy and firms are struggling to avoid bankruptcy as demand drops and credit tightens.

The unions have said the decisive wage hikes would put cash in people's pockets and boost consumer spending.


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