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Major German trade union wins pay hike, averting strike
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Members of the metal workers union IG Metall (IGM) Berlin hold a banner reading “End the war. Down with the weapons“ during a demonstration called by social associations, trade unions and environmental organizations in Berlin on Oct. 22, 2022. (AFP/John MacDougall)
G
ermany's biggest trade union agreed Friday on wage hikes totaling 8.5 percent that are expected to cover almost 4 million workers facing soaring inflation, averting a major strike in Europe's top economy.
The deal will be closely watched across the continent, which is facing spreading industrial action as employees demand large pay increases to cope with rising costs, particularly of energy.
The agreement between IG Metall union -- which represents workers in Germany's key metal and electrical sectors, and is seen a trend setter for setting wages nationwide -- was reached early Friday after weeks of talks and walkouts.
The so-called "pilot agreement" in the southern state of Baden-Wuerttemberg, which is expected to eventually cover about 3.9 million workers across Germany, lays out how the pay increase will be introduced in two stages, in 2023 and 2024.
It also includes a 3,000-euro (US$3,100) payment to combat the impact of inflation.
"Employees will soon have significantly more money in their pockets -- and permanently," said Joerg Hofman, president of IG Metall.
The union had initially called for an eight percent increase over 12 months, the biggest hike since 2008.
Its members are from a vast range of key businesses, from automotive to electronics.
Workers have been ratcheting up pressure -- with demonstrations, and a series of "warning strikes" at the end of October, which are walkouts for a limited duration, which often accompany salary negotiations in Germany.
If no deal was reached, then the union was poised to launch more serious strikes lasting 24 hours.
While companies are under pressure to hike wages to cope with rising costs, there are fears that raising them too sharply could stoke already sky-high inflation.
