After the failed collective bargaining for the approximately 930,000 employees in the construction industry, the arbitrator presented his proposal today. Now both sides have to vote on it by the beginning of May.
The approximately 930,000 employees in the German construction industry should receive more money. In the recently failed collective bargaining negotiations, the arbitrator presented his award today. Now the employer and employee representatives will vote on it by May 3rd. The proposal from the former President of the Federal Social Court, Rainer Schlegel, who mediated the talks in Wiesbaden, envisages significant wage increases.
Industrial union true Arbitrator’s verdict to
Income is to be increased by 250 euros per month on May 1, 2024. Eleven months later, another 4.15 percent in the west and 4.95 percent in the east will be added. The training allowance in the first year of training should be 1,080 euros in both East and West and the term should be two years. The negotiating commission of the Construction-Agrar-Environment Industrial Union (IG BAU) said it agreed to the arbitrator’s suggestion.
“We grudgingly support the saying,” said the chairman of IG BAU, Robert Feiger. Now it’s the employers’ turn. However, its arbitration commission initially rejected the decision. However, the construction company committees could still approve the proposal within the next 14 days.
“If you don’t do this, then of course there will be industrial action,” warned Feiger. The mood among construction workers is highly explosive. He wants to recommend that the union’s Federal Collective Bargaining Commission approve the arbitrator’s decision. “We are taking responsibility for society as a whole, because there is a construction traffic jam in Germany.”
Three uneventful rounds in collective bargaining negotiations
The Central Association of the German Construction Industry (ZDB) and the Main Association of the German Construction Industry stated that the arbitrator’s decision would now be voted on in the member associations of the employers’ collective bargaining association. A spokeswoman for the ZDB explained that the employer side had not yet agreed to the arbitration award in the arbitration negotiations – “in order to get into the coordination process with the member associations.”
IG BAU had previously declared collective bargaining to have failed after three unsuccessful rounds. Carsten Burckhardt, federal board member of IG BAU, emphasized that the employers had not made a negotiable offer. “Twice a little over three percent increase in income over 24 months simply does not compensate for the immense increase in living costs in recent years and months.”
IG Bau is demanding 500 euros more wages, salaries and training allowances per month for a period of one year. The construction industry, represented by the Central Association of the German Construction Industry (ZDB) and the Main Association of the German Construction Industry (HDB), had offered the union a wage increase of 3.3 percent for 2024 and 3.2 percent for 2025. They had referred to the crisis, particularly in housing construction, and accused the union of completely ignoring it.
Residential building permits are falling again
The construction industry is one of the largest employers in Germany and, with sales of around 162 billion euros in 2023, according to the construction industry association ZDB, an important pillar for the German economy. The industry had supported the economy for years during the real estate boom, but now it has become a problem child due to the crisis in housing construction.
Because of increased interest rates and expensive materials, housing construction is in crisis, and the federal government’s new construction target of 400,000 new apartments per year is out of reach. According to DZ Bank estimates, the number of annual completions could fall to 200,000 apartments by 2025.
Building permits have also been going downhill for many months. In February they fell by a good 18 percent compared to the same month last year, as the Federal Statistical Office announced yesterday. Compared to February 2022, there was even a drop of 35.1 percent. The Munich ifo Institute recently reported that the mood in housing construction remains tense. Every fifth housing construction company reports cancellations.
Lars Hofmann, HR, tagesschau, April 19, 2024 3:38 p.m