PressSplit
Millions of collective agreements will expire at the end of the year. The unions are positioning themselves for renegotiations. The demands are high.
Berlin – At the end of 2024, the collective agreement for 2.5 million federal and municipal employees will expire. The unions are taking this as an opportunity to make demands. The new tariff round is eight percent more Salary. There is already clear criticism from employers.
Unions are demanding more salaries in the public sector – collective bargaining round begins in January
350 euros more per month, more free time and a new union bonus – the public sector unions are demanding this and more in the coming collective bargaining round. They want to enforce salary increases for around 2.5 million local and federal employees, which – together with higher demands for free time – amount to a demand amount of more than eight percent. In addition, public employers should grant their employees an additional day off if they are members of a union.
Verdi members in Leipzig (symbolic photo). Millions of collective agreements will expire at the end of the year. The unions are positioning themselves for renegotiations. The demands are high. © IMAGO/EHL Media/Matthew Damarell
The collective bargaining committees of the Verdi and DBB civil service unions decided on this on Wednesday (October 9th) and thus exceeded the current demands of IG Metall – which amounted to seven percent. Negotiations for public sector unions begin in January. For Verdi boss Frank Werneke, the amount of the demand is motivated by economic policy. It was “about strengthening purchasing power and thus domestic demand,” he was quoted as saying Frankfurter Allgemeine Zeitung. “This is important for economic growth in Germany.” The collective agreements for the federal and local governments expire at the end of 2024, hence the renegotiations.
The current tense economic situation is no secret: it was only on Wednesday that the Federal Minister of Economics Robert Habeck (Greens) confirmed the forecast that had already been made that the economy should decline by 0.2 percent in 2024 – the federal government had previously forecast growth of 0.3 percent.
Criticism in the run-up to the collective bargaining round – “It’s simply not manageable”
The new demands immediately brought criticism from the public sector unions. According to the Association of Municipal Employers’ Associations (VKA), they would endanger the municipalities’ ability to act. The wage demands and the additional days off would entail additional costs of 14.9 billion euros, explained VKA President Karin Welge (SPD) told the news agency AFP. More days off would mean more frequent daycare closures and restrictions on citizen services. “It’s simply not possible and doesn’t fit into this time.”
Welge also couldn’t do anything with the unions’ arguments, for example regarding inflation. The times of high inflation are over; it is now only 1.6 percent. Nevertheless, the difficult economic situation had ensured that the municipalities were structurally underfinanced. An increase for the lower and middle wage groups is not the right way to make the public service more attractive.
Rather, incentives are needed for taking on leadership positions. The public service has to compete with the salaries of the private sector.
“Robust” demands – economists show understanding for demands before collective bargaining rounds
Economists, on the other hand, seem to be more understanding of the unions’ demands. Thomas Gitzel, chief economist at VP Bank, told the daily news stated that competitive pay was necessary to make the public service more attractive. However, he does not assume the eight percent wage increase. And Cyrus de la Rubia, chief economist at Hamburg Commercial Bank, also found the demands “robust”.
However, he can partly understand this, as the devaluation of money continues to burden many households. “If you make a four-year comparison, for example, prices today are almost 20 percent higher than at the end of 2020.” (Laernie with AFP)
