Segmentation of Collective Bargaining and Gender Wage Gap

The process of reunification eroded collective bargaining and employee representation in the workplace in Germany. By 2013, coverage by collective bargaining had fallen to 60 per cent in western Germany and 47 per cent in eastern Germany[1] (Schulten and Bispinck 2014). Furthermore, only 42 per cent of all employees were represented by a work council. Accordingly, only a third of all employees were fully protected by the different legal institutions of the German industrial relations system (WSI-Tarifarchiv 2015). This development was attributed to structural changes as well as to

Employment development in Germany by gender (2001-2011)

Fig. 10.1 Employment development in Germany by gender (2001-2011): (a) men, (b) women employers’ decisions to leave or not to join employers’ organizations. The resulting segmentation of collective bargaining (Artus 2010) accumulated with the segmentation and segregation of the labour market. In 2013, a comparatively high coverage by collective bargaining (60-86 per cent) was still to be found in male-dominated industries (e.g., energy, construction or manufacturing) and in some gender-mixed branches of the service sector (e.g., banking and insurance). Much lower coverage (about 40 per cent) was found in female-dominated services such as the hotel, catering or retail trades. All respective categories displayed regional differences, indicating that coverage in eastern Germany generally was much lower than in western Germany (WSI-Tarifarchiv 2015). These differences coincided with diverging power relations between the social partners in different branches. Therefore, between 2000 and 2013, negotiated wages in retail and the public sector increased only by 3 and 6 percentage points, respectively, while in chemicals and metalworking they increased by 17 and 15 points, respectively (Schulten and Bispinck 2014; see also Hassel 2014).

Closely related to these developments was the increase in low- wage employment (60 per cent of median wage per hour) to 19 per cent in western Germany in 2010, and the maintenance of the rather high level of 37 per cent in the east. Although nearly half of all low- wage earners were full-time employees, the relative share among flexible employees was higher, with marginal part-time employees the most affected (Table 10.1). Females, the young, the low-qualified and migrant workers were overrepresented in the low-wage sector (Schulten and Bispinck 2014).

To tackle the increase in low-wage employment, a 2007 compromise was reached by the grand coalition (Oschmiansky and Kuhl 2011) to introduce sector-specific minimum wages according to the law on posted workers (Arbeitnehmer-Entsendegesetz). In 2015, Germany had 18 sector- specific minimum wage regulations, but these were related to different legal contexts (WSI-Pressedienst 2015). The minimum wage is highest in the western German construction industry (14.20 euros for qualified workers) and lowest in eastern German female-dominated professions such as eldercare or laundry/dry cleaning services (8.00 euros). Accordingly, these minimum wage regulations were rather weak in counterbalancing both the regional gap and the gender pay gap. The introduction of a statutory minimum wage of 8.50 euros in 2015 may help here, although several

Table 10.1 Structure of low-wage employment and share of low-wage employees among different groupsa (share in per cent)

Structure of low-wage employment

Low-wage employees as share of all employees in the respective group

2000

2005

2010

2000

2005

Sex

Men

35

33

36

12

14

Women

65

67

64

27

30

Working time

Full-time

54

49

48

13

14

Part-time

24

24

22

27

28

Marginal part-time

10

14

13

62

70

Region

Western Germany

66

73

72

15

18

Eastern Germany

34

27

28

37

38

aWithout apprentices and without persons in employment promotion measures Source: Brenke and Grabka (2011)

exceptions are allowed until 2017 (Schuler 2015). Calculations project a decrease in the (unadjusted) gender wage gap from 19.6 per cent to 17.1 per cent (according to data from 2012; Boll et al. 2015).

As a consequence, institutional dualization can be seen in the continuity of a collective bargaining system that is paralleled by ‘bargaining free zones’ and the reflexive introduction of a (statutory) minimum wage. Outcomes, however, differ not only between collective bargaining and non-coverage but also between negotiated wages according to power relations between social partners in different sectors.

  • [1] This refers to the share of employees who are covered by collective bargaining in relation to allemployees.
 
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