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Herwarth Brune, CEO of ManpowerGermany, sees the new collective agreement between the Confederation of German Trade Unions (Deutscher Gewerkschaftsbund - DGB) and the employer’s association of the temporary staffing industry (Verhandlungsgemeinschaft Zeitarbeit - VGZ), securing increases to the minimum wage through to 2016 as providing many opportunities, but also warns of possible competitive disadvantage compared to other countries according to a Press release issued by ManpowerGermany
The agreement which we covered on 17 September 2013 comes into force on the 1st of January when the minimum wage in the West will rise by +3.8% to €8.50 and in the East by +4.8% to €7.86. By 2016, both amounts will continue to increase and equalize with each other. This model, according to Manpower is a forerunner of a general minimum wage in Germany, currently negotiating the CDU / CSU and SPD.
The new wage rises highlight the first class treatment that temporary agency workers receive according to Brune Herwarth. He adds that, ‘workers receive fair wages and supplements and can continue to develop through training. In addition, temporary workers have all the rights of permanent workers, for example in relation to leave, parental leave or job protection.
Approximately 70% of Manpower employees receive over 8.50 euro per hour, top level employees get at least 18,20 euro according to the company, with particularly well-qualified staff even getting even more. The average hourly wage of all time 20,000 workers at ManpowerGroup is about 11 euros.
The new agreement gives businesses the opportunity to plan for the next three years. However, Herwarth adds, ‘the situation should be closely monitored in East Germany as companies try to cope with the wage adjustments. The staffing firms will also fulfill their responsibilities to 2016 with the agreement taking into account the interests of workers and enterprises and safeguarding the stability of employment in Germany.’
Herwart adds that “if the minimum wage for lowest paid workers is too high, business would shift their activities abroad. Low skilled workers would have fewer opportunities in Germany. The new collective bargaining agreement shows that the industry regulates itself, highlighting a responsibility towards workers but also a realisation that temporary work must remain flexible.”