IG Metall sets scene for higher pay claims

The executive of the German metalworkers' union IG Metall is recommending a pay claim of between 5% and 7% for the 3.6 million workers in the sector. The claim is important as the outcome will determine much of the German pay round for 2002.

The recommended claim, which has been decided after months of discussion, is substantially higher than inflation, which in November was running at 1.7%.

The union argues that around 4.0% of the claim is justified by forecast price increases and productivity improvements. The rest, says the union's president, Klaus Zwickel, is "redistribution and catching up".

Zwickel says employers can afford the claim because wages and salaries now take up a smaller share of total metal industry output, down from 26.9% in 1993 to 18.8% today. He also suggests that it will have economic benefits in boosting domestic demand.

These views are not shared by the employers, who have argued that the current difficult economic situation requires moderate increases. Dieter Hundt, the president of the employers' association BDA, described the claim as "irresponsible" and said the union had "lost touch with reality".

The union also wants a move to a single pay structure for manual and non-manual workers.

The existing two-year agreement in the metal industry, which produced a 2.1% increase in 2001, left many dissatisfied. It runs out at the end of February and the new agreement is likely to be hard-fought.