IWH-Insolvenzforschung
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Student assistant (f/m/x) for 20 hours per week (Structural Change and Productivity)
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Department Profiles
Research Profiles of the IWH Departments All doctoral students are allocated to one...
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LRF Research Profile
Research Profile of the Department of Laws, Regulations and Factor Markets The ...
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Uncovered Workers in Plants Covered by Collective Bargaining: Who Are They and How Do They Fare?
Boris Hirsch, Philipp Lentge, Claus Schnabel
British Journal of Industrial Relations,
Nr. 4,
2022
Abstract
Abstract In Germany, employers used to pay union members and non-members in a plant the same union wage in order to prevent workers from joining unions. Using recent administrative data, we investigate which workers in firms covered by collective bargaining agreements still individually benefit from these union agreements, which workers are not covered anymore and what this means for their wages. We show that about 9 per cent of workers in plants with collective agreements do not enjoy individual coverage (and thus the union wage) anymore. Econometric analyses with unconditional quantile regressions and firm-fixed-effects estimations demonstrate that not being individually covered by a collective agreement has serious wage implications for most workers. Low-wage non-union workers and those at low hierarchy levels particularly suffer since employers abstain from extending union wages to them in order to pay lower wages. This jeopardizes unions' goal of protecting all disadvantaged workers.
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The German Model of Industrial Relations: Balancing Flexibility and Collective Action
Simon Jäger, Shakked Noy, Benjamin Schoefer
Journal of Economic Perspectives,
Nr. 4,
2022
Abstract
We give an overview of the "German model" of industrial relations. We organize our review by focusing on the two pillars of the model: sectoral collective bargaining and firm-level codetermination. Relative to the United States, Germany outsources collective bargaining to the sectoral level, resulting in higher coverage and the avoidance of firm-level distributional conflict. Relative to other European countries, Germany makes it easy for employers to avoid coverage or use flexibility provisions to deviate downwards from collective agreements. The greater flexibility of the German system may reduce unemployment, but may also erode bargaining coverage and increase inequality. Meanwhile, firm-level codetermination through worker board representation and works councils creates cooperative dialogue between employers and workers. Board representation has few direct impacts owing to worker representatives' minority vote share, but works councils, which hold a range of substantive powers, may be more impactful. Overall, the German model highlights tensions between efficiency-enhancing flexibility and equity-enhancing collective action.
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What Does Codetermination Do?
Simon Jäger, Shakked Noy, Benjamin Schoefer
ILR Review,
Nr. 4,
2022
Abstract
The authors provide a comprehensive overview of codetermination, that is, worker representation in firms’ governance and management. The available micro evidence points to zero or small positive effects of codetermination on worker and firm outcomes and leaves room for moderate positive effects on productivity, wages, and job stability. The authors also present new country-level, general-equilibrium event studies of codetermination reforms between the 1960s and 2010s, finding no effects on aggregate economic outcomes or the quality of industrial relations. They offer three explanations for the institution’s limited impact. First, existing codetermination laws convey little authority to workers. Second, countries with codetermination laws have high baseline levels of informal worker voice. Third, codetermination laws may interact with other labor market institutions, such as union representation and collective bargaining. The article closes with a discussion of the implications for recent codetermination proposals in the United States.
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