Press Release No. 08/2010 Temporary Work: Collective Bargaining Agreement Curbs Wage Dumping and Abuse

Berlin/Frankfurt am Main – The unions ver.di and IG Metall have hailed the agreement reached between the Federal Association of Temporary Employment and Personnel Services (BZA) and the DGB Temporary Employment Bargaining Association as a step forward. “We have succeeded in establishing a minimum wage of 7.50 euros and setting good collective bargaining standards,” explained ver.di President Frank Bsirske in Berlin. “We want to combat abuse in the temporary staffing sector; this agreement provides a good foundation for that,” said IG Metall President Berthold Huber on Tuesday in Frankfurt.
Under the collective bargaining agreement, minimum wages will increase according to a phased plan: in western Germany, from 7.38 euros to 8.19 euros per hour by November 1, 2012; in eastern Germany, from 6.42 euros to 7.50 euros over the same period. For the other pay grades, percentage increases were agreed upon: 2.5 percent effective July 1, 2010; another 2.5 percent effective May 1, 2011; 1.74 percent effective November 1, 2011; and another 2.5 percent effective November 1, 2012.

Furthermore, the agreement stipulates that the previous option to offset tax-exempt expense allowances against gross pay will be eliminated without replacement as of July 1, 2010. This precludes indirect wage cuts.

An additional clause also stipulates that the new collective bargaining agreement cannot be misused as a means to reduce wages through intra-group temporary staffing or to replace permanent staff with temporary workers. “In principle, this means that for intra-group temporary work, permanent employees and temporary workers must receive equal pay. The abuse of temporary work according to the ‘Schlecker model’ must not be allowed to happen again,” emphasized Bsirske and Huber. Both union leaders called on the federal government to curb wage dumping in the temporary work sector.