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Germany  Germany

Key Facts

Population81,802,000
Collective Bargaining Coverage 62%
Proportion of Employees in Unions 18%
Principal Level of Collective Bargaining

industry

Workplace Representation

works council

Board-level Representation

yes: state-owned and private companies

Company Board Structure

dualistic

Sources: see individual country sections; where a range of figures has been quoted, the lower number has been taken

Trade Unions

Only around a fifth of employees in Germany are union members, and union density has fallen sharply since the early 1990s, in part because of a sharp fall in manufacturing employment in Eastern Germany after unification. The vast majority of union members are in the main union confederation, the DGB, but within it individual unions, like IG Metall and Verdi, have considerable autonomy and influence.

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Collective Bargaining

Collective bargaining is still primarily conducted at industry level between individual trade unions and employers' organisations. However, the system is under pressure as employers leave or never join employers' organisations, and the agreements themselves provide for greater flexibility at company level.

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Workplace Representation

note2

Works councils provide representation for employees at the workplace and they have substantial powers – extending to an effective right of veto on some issues. Although not formally union bodies, union members normally play a key role within them.

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Board-level Representation

Employee representatives have a right to seats on the supervisory board of larger companies – one-third in companies with 500 to 2,000 employees, half in companies with more than 2,000.

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European-level Representation

European level representatives are chosen through the works council structure. However, for the European Company, there are rules which guarantee seats to trade union officials and – in the largest companies – representatives of senior management, both on the SNB and at board level.

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Health and Safety Representation

The works council has a key role in representing employees on health and safety issues. It sends representatives to the joint health and safety committee and its agreement is required in some areas, such as the appointment of the works doctor.

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Financial Participation

The incidence of employee financial participation in Germany is at an average level internationally. Only one tenth of all companies practice profit-sharing and only 2% have employee share ownership schemes. The concept of employee financial participation has been in and out of public debate in the last decades, with varying intensity. The end of 2005 saw the debate gaining ground, mainly due to political focus. This ended up with the adoption of a new law promoting employee share ownership (the "Mitarbeiterkapitalbeteiligungsgesetz”) in early 2009. The political goal defined in the law is greater employee participation in the success and capital of companies.

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