IG Metall calls strike in metalworking

On 6 May 2002, Germany's IG Metall metalworkers' union called a strike in its 'flagship' Baden-Württemberg bargaining district after negotiations over a new collective agreement failed. While IG Metall demanded a 6.5% wage increase, the Gesamtmetall employers' association offered a package worth 3.25% (according to union calculations). Although large-scale strikes are rare in its post-war history, IG Metall has gone to some lengths to develop a new strike strategy, which seeks to avoid spill-over effects to other districts which are not yet included in the strike campaign.

On 6 May 2002, the German metalworkers' trade union IG Metall called some 50,000 workers out in strike in Baden-Württemberg, the union's 'flagship' district in the south-west of Germany. The strike came after negotiations over a new sector-wide collective agreement for the metalworking industry had stalled about two weeks previously. On 19 April, having negotiated without interruption for 15 hours, Berthold Huber, the union's chief negotiator for the Baden-Württemberg district, declared that the talks had failed to reach an agreement.

Gesamtmetall, the employers' association for the metalworking industry, had offered a 3.3% wage increase effective from the third month of the agreement's 15-month period, as well as an EUR 190 lump-sum payment for the first two months. IG Metall, however, declined to accept this offer because it was considered to be too far from its initial demand for a 6.5% wage increase (DE0204201N). According to the union's own calculations, the employers' offer is worth 3.25%, which is below the settlement reached in the chemicals industry in April (DE0205204F).

A few days after the breakdown of the talks, the IG Metall Baden-Württemberg district organisation applied to the union's national executive board for permission to initiate a strike vote. Other districts followed suit. The board finally decided to conduct strike votes in two districts, Berlin-Brandenburg and Baden-Württemberg. While Baden-Württemberg has served as a pattern-setter for the entire metalworking industry on numerous occasions, this was the first time that a strike vote had been conducted in Berlin-Brandenburg, an eastern German district with a rather weak industrial base. In both districts, members' support for a strike was well above the 75% margin required by the union's constitution. In east Berlin 87.2% of the union's membership voted 'yes' to a strike (85.7% in Brandenburg), while support was 90.04% in Baden-Württemberg.

Some observers fear that a prolonged and extensive strike might damage the German economy and thus reduce Gerhard Schröder's changes of being re-elected as Chancellor in the elections to be held on 22 September 2002. It should be noted, however, that compared with most other countries, there is a low incidence of industrial action in Germany.

History of industrial action in metalworking

Germany's low incidence of industrial action holds even for IG Metall, which is considered to be one of the more militant member unions of the German Federation of Trade Unions (Deutscher Gewerkschaftsbund, DGB). Strike activity in metalworking has been quite low throughout the post- Second World War period. According to an analysis by the Institute for Economic and Social Research (Wirtschafts- und sozialwissenschaftliches Institut, WSI) there have been only nine strikes of considerable size and duration during the past 50 years. As shown in the table below, most of those strikes were also of limited geographical scope.

Source: WSI collective bargaining archive.

It is also striking that some of the longest and most serious disputes have been about issues other than wage increases. Thus, unions and employers have fought most passionately when issues such as working time reductions, sick pay or work organisation have been on the bargaining table.

IG Metall employs new strike strategy

To increase pressure on employers to reach a settlement, IG Metall has developed a new and more flexible strike strategy. Starting in 21 mostly large companies in its Baden-Württemberg district, the union will pursue a rotating strike which will change its target almost every day. Thus, IG Metall intends to include 81 companies in the first week of the strike. It is the union's goal to avoid a so-called 'cold lock-out'- this occurs when a second company, which is not the target of a strike, is negatively affected by work stoppages at the plants of a supplier or customer and thus cannot offer work to its own workforce. Workers who are laid off due to the indirect effects of the strike are neither entitled to claim wages from their employer nor to receive any state assistance. While prior to 1986 the Federal Employment Service (Bundesanstalt für Arbeit) was required to pay a supplementary allowance to these workers, this practice was ended by a revision in that year of the Employment Promotion Act (later this provision was included into section 146 of the Social Security Code, Book III).

The revision of the law has had a considerable impact on unions' strike strategies. Prior to 1986, IG Metall used a 'Mini Max' strategy, whereby it predominantly targeted a small number of suppliers to maximise the pressure on the large companies. Under the old law, the union thus had to pay strike benefits only to a small number of striking members (mostly those working in supplier companies) but was still able effectively to shut down large parts of the entire metalworking industry. Compensation for those workers who were affected indirectly by the strike was provided through public sources and thus did not drain money from the union's strike funds. Under the new conditions, the union has sought to avoid such indirect strike effects, because laid-off workers would be left without any pay and the union would not have enough resources to compensate them on its own. While the new policy of strike rotation might help to avoid these negative spill-over effects, it also requires considerable discipline on the part of IG Metall's rank and file, when they are asked to report back to work after they have been on strike for only one day.

Statements on the strike

In a statement, Gesamtmetall's president, Martin Kannegiesser, emphasised that his organisation did not plan to use lock-outs as a strategic tool to deal with the strike called by IG Metall. Mr Kannegiesser, however, sees the strike as an outdated tool which has proven to be inappropriate for resolving conflicts on the just distribution of wealth. Mr Kannegiesser argues that, given that the union and metalworking employers have recently succeeded in reaching agreements on complicated and potentially conflict-prone subjects such as pensions (DE0111201F), training (DE0107233N) and equal compensation for white- and blue-collar workers, it is inappropriate for IG Metall to call a strike over a 0.7% wage increase - which is assumed to be the difference between the union's demands and employers' offer - when the negotiations have failed. According to Gesamtmetall's own calculations, an additional wage increase of 0.7% would increase the value of workers' monthly pay cheques by between EUR 7.78 and EUR 9.29. Otmar Zwiebelhofer, the employers' chief negotiator for the district of Baden-Württemberg, called on the union to return to the bargaining table as soon as possible.

IG Metall's president, Klaus Zwickel, emphasised that his union was willing to negotiate, but that it would first take an improved offer by Gesamtmetall to bring IG Metall back to the bargaining table. In his view, it was a provocation by Gesamtmetall to make an offer which was far below what the chemicals industry workers had been awarded in their agreement. Thus, Mr Zwickel argued, IG Metall had no choice but to call a strike.

Commentary

What can be expected in terms of the final outcomes of the strike? From the evidence of the history of strikes in Germany, a few points seem to be obvious.

First, IG Metall desperately needs to negotiate a 'strike premium' to satisfy its membership, which means that a final settlement is more likely to be above the level agreed upon in the chemicals industry.

Second, given that wages are the sole issue on the bargaining table, we can expect the strike to be rather short.

Third, and despite all the hardship which a strike brings for companies (company revenue will decline) and workers (who will lose parts of their income during the strike), both IG Metall and Gesamtmetall can take advantage of the strike by strengthening the ties between their organisations and their membership. To make industry-wide collective bargaining work, strong unions and employers' associations are required, which need to create and maintain the capacity to mobilise solidarity within their membership but also to enforce discipline and consent. Once in a while, it takes a strike to keep their organisational power from deteriorating. From this point of view, there is nothing wrong with punctuated conflict and even 'ritualised' strike activities. The current campaign, however, does provide a reason for concern. To make the strike work, IG Metall requires discipline and consent from its rank and file as a precondition and not an outcome of its new strike strategy. This entails a high level of risk. (Martin Behrens (Institute for Economic and Social Research, WSI)