T-Geld in the Metal and Electrical Industry FAQs on Transformation Allowance and the Trafobaustein

What is the T-Geld or the Trafobaustein?

The Transformation Bonus (T-Geld) is an additional annual special payment under the collective bargaining agreement, in addition to the vacation bonus, the collective bargaining supplementary bonus (T-ZUG), and the Christmas bonus. IG Metall secured the T-Geld as part of the collective bargaining agreement in the metal and electrical industries in March 2021. In Baden-Württemberg, the T-Geld is called the “transformation module” (Trafobaustein).

The transformation bonus can also be used to secure employment, subject to an agreement between the works council and the employer—and, in companies facing economic crises, it can also be “adjusted,” meaning it can be deferred or suspended.

How much T-Geld is there?

The T-money (the Trafobaustein) amounts to 18.4 percent of the regular individual monthly pay (see below).

Specific example: A fully trained skilled worker in the so-called “base pay” group with a 10 percent performance-based pay component and no shift work receives approximately 600 euros in T-Geld.

Who is eligible for T-Geld?

Employees and apprentices in companies in the metal and electrical industries that are bound by collective bargaining agreements, who are in an employment or apprenticeship relationship as of the payment date of July 31 of the calendar year and have been with the company for six consecutive months as of that date.

Note: Many companies have their own in-house collective bargaining agreements (such as at VW) or so-called recognition agreements. It depends on whether the employer recognizes all regional collective bargaining agreements in the metal and electrical industries in the contract—including any subsequent amendments—or only the wage increases. Ask your works council or the local IG Metall office.

Temporary agency workers are not entitled to the T-Geld, as separate collective bargaining agreements apply to them as well.

Note:In 2026, the additional amount of the Collective Bargaining Supplement (T-Zug B) will increase from 18.5 percent to 26.5 percent of the base pay for the respective collective bargaining region.

When will I receive the T-Geld?

The T-Geld is to be paid as a one-time payment no later than July 31. However, the payment may be postponed until no later than September 30 by company agreement. If the T-Geld is “differentiated,” it may also be postponed for a longer period or suspended (see below).
 

What about part-time and partial retirement employees?

Part-time employees receive the T-Geld in the same way as other special payments: 18.4 percent of their regular individual monthly pay.

For employees in partial retirement, their partial retirement pay—that is, half of their previous full-time pay—is used as the basis. Under the block model, this applies to both the work phase and the leave phase. As a one-time payment, the T-Geld—unlike monthly pay—is not topped up in accordance with the collective bargaining agreement.
 

What applies during parental leave?

Employees on parental leave generally meet the requirements for T-Geld. However, since the employment relationship is suspended during parental leave, the entitlement is reduced proportionally for the duration of the suspension. Example: If you take 6 months of parental leave during the year, you will receive only half of your T-Geld.
 

Do I still receive T-Geld if I’m receiving sick pay?

Although the employment relationship is suspended while you’re receiving sick pay—unlike during parental leave—this suspension isn’t “by law.” Therefore, you’re still entitled to the full amount of T-Geld even while receiving sick pay.

How is the “regular individual monthly pay” calculated?

Similar to vacation pay, the calculation is based on your regular monthly pay (or regular training allowance).

The calculation is based on the fixed pay components for the current month—primarily the monthly base pay—plus the monthly average of the variable pay components from the last three months (in North Rhine-Westphalia, the last six months).

These include: performance-based variable pay components—that is, performance-based pay (piece rates, bonuses, etc.) as well as premiums for late-night, night, Sunday, and holiday work, hardship allowances, individual bonuses, commissions, and allowances based on the average of the last six paid months, but excluding overtime pay and travel allowances.

Roughly speaking, this means: Check what you’ve earned on average over the last few months and subtract the pay for overtime. You’ll receive 18.4 percent of that amount.

I’m leaving the company. Will I receive severance pay?

In the year you leave, your entitlement is prorated.

Example: If you leave the company on July 1, you’ll receive a pro-rated T-Geld payment for the months of January through June—that is, for 6 out of 12 months, which is half of your annual entitlement.

Eligible employees or trainees whose employment relationship is suspended during the calendar year by law or by agreement do not receive any benefits. If the employment relationship is suspended for part of the calendar year, they receive T-Geld on a pro-rata basis.

The T-Geld can also be used “to secure employment.” How does that work?

In the event of a reduction in working hours due to employment difficulties, the T-Geld can be offset against a partial wage compensation agreed upon by the employer and employee representatives.

Example:

The works council and the employer agree to reduce working hours from 35 to 32 hours per week to bridge a transition phase, such as the shift to new products for electric mobility. For the duration of the reduction—up to three years or longer, depending on the collective bargaining area—layoffs for operational reasons are prohibited.

To keep monthly pay stable despite the shorter workweek, the works council and the employer agree on a partial wage compensation arrangement that includes the T-Geld. This can also be combined with other special payments. In addition, the employer makes contributions. As a result, for 32 hours of work—ideally in a four-day workweek—employees are paid for nearly 34 hours.
 

What does it mean that the T-Geld can be “adjusted”?

Depending on the company’s economic situation, the T-Geld may be withheld in whole or in part, or its payment may be deferred for up to 5 months, if this serves to maintain or restore competitiveness. This requires the prior consent of IG Metall.