The wage increase – better than three times Germany’s inflation rate at 0.9% during 2014 – trumped a company offer of a pay increase of 2.2%.
The German metalworkers’ union, IG Metall, has succeeded in securing a 3.4% pay rise in a deal with employers following warning strikes by more than 850,000 workers nationwide. The biggest trade union in Germany with 3.7 million workers agreed to a one-year deal for the southwest region plus a one-time payment of 150 euros. Traditionally such deals serve as a pattern for all of Germany.
“This is, by a wide margin, the biggest real wage increase for years,” said Suedwestmetall president Stefan Wolf, of the the region that got the increase and bonus. The industrial and automaking area is home to Daimler and Bosch, among other firms with 800,000 metal and electronics workers.
Germany as Europe’s largest economy grew by 1.6% last year and the government predicts it will grow by 1.5 % during 2015.
“With this result we are bringing stability to the German economy,” said IG Metall’s president Detlef Wetzel.
Other gains were made on early retirement, in particular for lower paid workers. In the future, employers will pay 90% of salaries while workers work through a period of early retirement, which will then be continued once they have stopped work and up until their official retirement age. It means that early retirement will be more affordable for lower income employees, particularly on assembly lines and in general production.
In addition, money not used by companies in funding early retirement, which must be accessible to a minimum of 4% of the workforce, must now be used to pay for staff training schemes.
The IG Metall president marked the progress as “the first important step” in establishing a model for workers’ rights for career development.
