Bonus and wage increase - Steel collective agreement with working time rules for transformation
For the first time, working time regulations have been agreed in the German steel industry for the upcoming transition towards climate neutrality. The rules are part of a collective bargaining agreement reached by IG Metall and the German Steel Employers' Association on Saturday morning in Düsseldorf.
In addition to an inflation compensation bonus of 3,000 euros and a wage increase of 5.5 percent from 2025, the collective agreement also includes a collective agreement on job security. This is to be applied if fewer workers are needed as a result of the planned transformation. This applies, for example, to coking plants whose coke will one day no longer be needed in hydrogen-powered steel production plants.
The agreement was reached in the 5th round of negotiations after around 14 hours of marathon negotiations in Düsseldorf. It is regarded as a pilot agreement for the steel industry.
32-hour week possible without full wage compensation
On the one hand, the agreement provides for regulations for companies or parts of companies in which "pressure on employment" arises as a result of the transformation. In this case, working hours can be reduced by three hours to 32 hours, based on the standard working time of 35 hours applicable in the industry. IG Metall was unable to push through its demand for full wage compensation, but was able to achieve payment of 33 hours.
The collective agreement also provides for regulations in the event of additional requirements, for example due to the temporary parallel operation of old and new technologies. Working hours can then be increased by up to three hours. The existing regulation on overtime pay is then applied.
33.6-hour week also possible without pay compensation
The agreement also provides for the possibility of reducing individual working hours from 35 to 33.6 hours in all companies, but without wage compensation and only if there are no operational reasons to the contrary. Only those aged 60 and over who work shifts will be paid 34.1 hours from 2025. This age limit is to be lowered by one year in each of the following two years. The collective bargaining parties then want to evaluate the regulation in 2027.
IG Metall chief negotiator Knut Giesler expressed his satisfaction with the result. One of the most important goals had been achieved. "We are giving employees security during the transformation. If there is pressure on employment, the reduction in working hours with partial pay compensation means that the remaining work can be spread across several shoulders." A start has been made with the individual desire to reduce working hours.
The employers rated the regulations as "very positive". Reiner Blaschek, Chairman of the German Steel Employers' Association, emphasized that, together with IG Metall, it had been possible to create a tailor-made regulation on working hours and job security during the ecological transformation. The regulation on individual working hours gives employees more flexibility. "It was important to us that, as a rule, no compensation is paid for this."
Compensation bonus is paid on a staggered basis
The compensatory bonus will be paid in stages: 1500 euros will be paid in January, followed by 150 euros in each of the months February to November. Trainees will receive a total of 1800 euros, also staggered. Following the increase in salaries from January 2025, the collective wage agreement will run until September 30, 2025. The union had originally entered the negotiations with a demand for a wage increase of 8.5 percent over a period of twelve months.
However, the employers expressed their skepticism: "The agreed pay increase is stretching the companies' capabilities to the limit in view of the rapidly deteriorating conditions for the German steel industry," said Blaschek. Giesler, who is also district manager of IG Metall North Rhine-Westphalia, on the other hand, spoke of a "sustainable increase in income".
Warning strikes with tens of thousands of employees
The peace obligation ended at the end of November. Since then, tens of thousands of steelworkers have taken part in warning strikes lasting several hours. In recent days, the union had called for 24-hour warning strikes, including in Duisburg, the largest steel location in Europe.
Around 68,000 people are employed in the steel and iron industry in North Rhine-Westphalia, Bremen and Lower Saxony. In the eastern German steel industry, which employs around 8,000 people, the 5th round of negotiations is scheduled for December 18.
In the Saarland steel industry, with around 15,000 employees, collective bargaining has not yet begun. There, the peace obligation ends at the end of February. In addition to Saarland, the collective bargaining area also includes two plants in Wetzlar (Hesse) and Kehl (Baden-Württemberg).
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- The steel industry in Germany is undergoing a transformation towards climate neutrality, with premium products becoming increasingly important due to tariffs imposed on non-climate neutral steel imports.
- Knut Giesler, the IG Metall chief negotiator, acknowledged the challenge of balancing wage increases and the impact of tariffs on the steel industry in Düsseldorf.
- The new collective bargaining agreement includes provisions for South Westphalian coke plants, which may need to adjust their operations due to the shift towards green hydrogen production.
- In recognition of the role of coking plants in the steel industry's transformation, the agreement outlines temporary wage adjustments to account for the increased operational complexity.
- German employers in the metal industry have commended the new working time rules, as they allow for greater flexibility in the transition towards climate neutrality and a more agile workforce.
- The agreement in Düsseldorf can serve as a blueprint for other industries undergoing transformations, such as the chemical industry in Lower Saxony and Bremen, to adopt innovative labor policies.
- The adjustments to coke plants and working hours, in combination with wage increases, may contribute to making the German steel industry more competitive in the global market, despite the impacts of tariffs.
- Local politicians in North Rhine-Westphalia have welcomed the collective bargaining agreement as a step towards remodeling the steel industry and maintaining employment in the region.
- The implications of the new agreement extend beyond the steel industry, as the transformed coke plants can serve as components in the broader European push towards climate neutrality, potentially boosting Germany's role as an environmental leader.
- As the green steel industry takes shape, further conversations regarding climate neutrality, renewable energy sources, and the role of the steel industry in the broader European context will continue to be essential topics for decision-makers in Germany and beyond.
Source: www.stern.de
