German union’s big win shows US labor the path forward

Last week the German metalworkers’ union, IG Metall, arguably one of the world’s most powerful unions, showed that unions have the power to shape their future workplaces.  

IG Metall negotiated a precedent-setting collective-bargaining agreement that privileges working conditions over wages. It won its key demand that workers have the right to reduce their working week from 35 to 28 hours for a period of up to two years in order to care for family members.

{mosads}The union refused an initial offer of a 6.8-percent wage increase in favor of a reduction in work hours and a more modest increase in wages of 4.3 percent. The new agreement establishes a precedent for unions to bargain for working hours over wages and to take an active role in shaping the conditions needed in the current and future workplace.

As the largest industrial union in Germany and the European Union, IG Metall’s agreements traditionally set trends for national bargaining in Germany as well as the rest of the continent.

By using traditional negotiations and coordinated 24-hour strikes, the union won contract coverage for 900,000 metal and electrical workers, which will most likely be extended to cover close to 3.9 million workers in the sector. 

Outside Germany, unions and employers will be looking to see how this model agreement can be used to influence other collective-bargaining negotiations in industrial sectors.    

IG Metall’s contract is important for not only what it brings to workers in Germany today but what it says about the country’s labor relations system and how it will facilitate needed transitions responding to increased automation and improved technology.

German law lays a foundation for the power unions have in the workplace because it conceives workers as valued participants in the workplace. Through unions and works councils, workers have an important role in shaping policies at the shop floor and in management boardrooms.

In times of technological change, this system more readily permits workers and employers to develop strategies that benefit both parties. In contrast, in the U.S., workers and employers often have a more adversarial and imbalanced relationship making it difficult to develop solutions that address technological change while supporting worker interests in the workplace.

As unions in Germany and around the world grapple with “industry 4.0,” the rapid transition in workplaces due to technology and automation, they are developing strategies to negotiate agreements that reflect not only the current workplace but also a future that anticipates a continued rise in productivity due to improved automation and technology and a decreased level of job creation.

The challenge throughout this transition is to ensure that the increase in wealth due to higher productivity is shared equitably among workers.

Additionally, workers who experience job loss must be represented in policy discussions to determine plans for transition into jobs with good wages, social protections and fundamental worker rights like the right to form a union and bargain collectively.

The IG Metall agreement provides a model for how unions can address technological change at the bargaining table and prioritizes shorter working hours and a better work-life balance. 

The challenge for unions in the United States and in other countries where labor relations systems are less cooperative is how to ensure that responses to technological change include worker representation at every level.

Here, low union density, weak labor laws and limited cooperative dialogue between workers and employers results in a greater imbalance between workers and employers resulting in policies that do not reflect workers’ interests. 

As new technologies continue to increase productivity, unions with sectoral power like IG Metall will provide leadership for unions around the world by modeling contract language that addresses job loss due to technology and other changes.

This moment of rapid industrial transformation presents significant challenges for unions as well as opportunities to innovate at the bargaining table and in the policy realm to shape economic and social policies that ensure good jobs, protections and rights for all workers across all industries. 

Industry 4.0 should not be a period of continued erosion of laws and rights for workers and growing inequality but rather a moment to reshape the workplace to ensure a greater balance between employers and workers.

Building models for the current and future workplace that value the role of all workers will be fundamental to ensuring not only a more equitable workplace but also greater equality and democracy worldwide.

Cathy Feingold is the international director at the AFL-CIO, the largest federation of unions in the United States.