Employment relations in Germany

Abstract

This chapter reviews the historical development of the actors and processes in employment relations and highlights current practices. It shows that, while the formal institutional framework largely corresponds to the way Germany is portrayed in the Varieties of Capitalism approach, current practices deviate a great deal from the model. Business or trade associations represent general economic and product market interests vis-a-vis the state, whereas employers’ associations are concerned with social policy, labour market interests and employment relations, including collective bargaining. In contrast to the more voluntaristic systems of the liberal market economies, German employment relations are characterised by a high degree of juridification. The chapter discusses the main processes in the employment relations system: co-determination at the workplace and enterprise levels, collective bargaining and industrial disputes. In the majority of companies, they are in charge of employment relations and human resource management.