The details in the employment contract are decisive. In principle, it can be freely negotiated. How much a job applicant can secure in terms of salary or additional benefits, such as a company car, depends not only on their degree and grade. Negotiation skills are often required here as well. However, the employer must comply with the statutory minimum requirements. These are usually far below what is customary in the company or stipulated in a collective bargaining agreement .
Better with a Collective Bargaining Agreement
As a rule, the overall pay level is higher in companies that pay according to collective bargaining agreements. For example, young engineers earn 16.2 percent more than in companies not bound by such agreements. For economics graduates, the figure is 13.5 percent higher.
Collective bargaining agreements also ensure strong salary growth. For instance, salaries increase by an average of 10 percent in the first year after starting a career. As a general rule, the achievable annual salary must be at least as high as the collective bargaining rate—lower starting salaries are not permitted.
It All Comes Down to Annual Compensation
When people talk about “annual pay,” they often mean different things. Many companies pay twelve monthly salaries; others pay an additional 13th month’s salary. In companies that pay according to collective bargaining agreements, there is also a performance bonus— averaging four to 15 percent of pay, depending on the collective bargaining agreement. In addition, there are other benefits provided under collective bargaining agreements, such as vacation pay, Christmas bonuses, and contributions to retirement plans.
Salaries vary from region to region. The size of the company also plays a role. Generally speaking, salaries tend to be higher in western and southern Germany than in the north and east.
Entitlement to Reduced Full-Time Hours
In the metal and electrical industries, the 35-hour workweek is considered the standard workweek for full-time employees. Since January 2019, there has been a collective bargaining agreement entitlement to reduced full-time work. This allows employees to reduce their working hours to up to 28 hours per week for a period of six to 24 months. After that, the standard workweek automatically applies again—or they can opt for reduced full-time work once more.
With reduced full-time work, IG Metall has secured the right to return from part-time to full-time employment. Depending on their personal needs, employees can thus scale back their hours and later return to normal full-time work.
Starting Salaries in the Metal and Electrical Industry
Every year, we survey starting salaries for new entrants to the metal and electrical industries. The results consistently show that graduates have significantly more advantages in companies covered by collective bargaining agreements. The starting salaries provide an initial guide. If you’d like to know more about what’s typical at a specific company, we’re happy to help. Members can contact their local IG Metall chapter directly.
This article was originally published some time ago and is updated regularly.
