Strikes in Germany looming

Lisa & Ian Murray seamus at
Thu Mar 23 19:40:16 PST 2000

[From the International Herald Tribune]

Paris, Friday, March 24, 2000 Germany Braces for Battle Over Job Policy Rail Union Threatens To Snarl a Big City; IG Metall Plans Strikes

By John Schmid International Herald Tribune

FRANKFURT - Labor tensions heated up on two fronts in Germany on Thursday at a time when the government is pushing ahead with sensitive employment policy changes. Both the national railroad union and the sprawling IG Metall industrial union threatened to stage disruptive work stoppages in coming days, with workers vowing to hold ''warning strikes'' for a few hours and to protest at loud rallies.

The rail union threatened to target a large city with a three-hour protest strike on Saturday if the money-losing state railroad, Deutsche Bahn AG, carries out planned job cuts. If Deutsche Bahn refuses to make concessions in talks Friday in Cologne, the rail union vowed to choose a city for its temporary strike.

''If the railroad leaders still do not give in, we can react with a strike,'' said Norbert Hansen, a union leader. ''If it comes to that, all the railroad wheels will stand still.''

Germany is not alone in facing the ire of workers over economic reform. In France, Finance Minister Christian Sautter suffered a stinging defeat this week at the hands of trade unions. Mr. Sautter had sought to streamline the country's tax services to reduce costs but dropped the plan after the unions objected. Nearly 200,000 tax workers at the ministry staged a series of strikes to stop implementation of the plan.

To put pressure on Chancellor Gerhard Schroeder, who encourages Germany's new pro-business mood, the rail union said it may tangle traffic at the World's Fair in the chancellor's hometown of Hannover in June. The union called on Mr. Schroeder to intervene and avoid an escalation.

Meanwhile, the IG Metall industrial union on Thursday stepped up its threats to hold work stoppages starting Wednesday and spilling over into next month. If contract talks remain deadlocked by then, the militant metalworkers vowed to stage a succession of ''massive warning strikes'' across the country.

But IG Metall's bargaining stance appeared weakened Thursday after the chemical workers' union undercut its bigger ally by settling on a two-year package of low raises. IG Metall's chairman, Klaus Zwickel, rejected the terms of the chemicals union, reached late Wednesday, which gives a raise roughly in line with the current inflation rate of 2 percent. IG Metall, which is Europe's largest trade union, wants a 5.5 percent raise and a controversial new clause that allows early retirement at age 60. It scoffs at an offer from industry for a three-year contract of 1.5 percent annual wage increases.

Big business, meanwhile, lauded the chemicals union pact, reached without strike threats or time-consuming rituals, saying that it should be the benchmark for IG Metall.

It is a sign of landmark change in Germany that unions no longer move in lockstep and solidarity on wage policy. For decades, IG Metall's annual settlement set the benchmark for most other unions. But the 3.4 million-strong metalworkers' union stands to lose its pace-setting role if other unions line up behind the maverick chemical workers, who won a 2.2 percent wage hike in June and another 2 percent raise in June 2001.

''They have worked out their own deal, but it is no model for us,'' Mr. Zwickel, the IG Metall chief, said.

Like the rail union, IG Metall is free to conduct work stoppages of one day or less. IG Metall can begin its pickets after a one-month good-faith bargaining period ends at midnight on Tuesday.

In recent months, the atmosphere in Europe's biggest economy has become distinctly pro-business in comparison to the past decade, business leaders concur. The Ifo business confidence index hit a five-year high this week as entrepreneurs work to adapt to the global economy.

Mr. Schroeder has given the green light for mergers, acquisitions and restructurings on an unprecedented scale. Setting the tone, the chancellor spoke approvingly of Deutsche Bank AG's takeover this month of its rival, Dresdner Bank AG, which will eliminate 16,000 jobs and hundreds of bank outlets. The government also kept out of the way of a hostile takeover of Mannesmann AG of Germany by Vodafone AirTouch PLC of Britain.

The government's tax reform plans offer incentives for firms to divest unwanted operations and reap the profit from those sales untaxed. Although Parliament has yet to vote on tax reform, the draft legislation already has prepared the climate for Deutsche Bank's move.

Unions also balked at Mr. Schroeder's decision last week to invite 20,000 foreigners to come and fill positions in the computer programming sector. Economists and some officials at the European Central Bank share the view that nations such as France are bound to follow Germany's lead on economic and welfare policy. ''So long, Germany Inc.,'' has become the slogan of Deutsche Bank's chief executive, Rolf-Ernst Breuer.

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