The approximately 2.5 million public sector employees get significantly more money in view of the high inflation: the federal government, municipalities and unions agreed on higher tariffs late on Saturday evening after several hours of negotiations in Potsdam, as all parties involved announced. Among other things, the agreement provides for tax and duty-free special payments totaling 3,000 euros in several stages. EUR 1,240 of this should already flow this June, and a further EUR 220 each in the months from July to February 2024.
From March 2024 there will then be a base amount of 200 euros as a wage increase and then 5.5 percent more. If no increase of 340 euros is achieved, the relevant increase amount should be set to this sum. With this solution, the parties to the collective bargaining largely based themselves on the compromise proposal from the arbitration proceedings that ended a week ago. The term of the agreement is to be 24 months.
“Breaking the Pain Threshold”
“We have accommodated the unions as much as we can still be responsible for in a difficult budget situation,” said Interior Minister Nancy Faeser (SPD) after the round of negotiations. According to Verdi boss Frank Werneke, the negotiations were not easy. “With our decision to make this compromise, we went to the pain threshold,” he said. The parties in Potsdam had been struggling to find a solution since Saturday afternoon.
The solution found poses particular challenges for the many cash-strapped municipalities in Germany. The President of the Association of Municipal Employers’ Associations, Karin Welge, had estimated the additional costs for cities and municipalities on the basis of the arbitration proposal at 17 billion euros before the negotiations.
A strike ballot among the unions and possible indefinite strikes are off the table with the agreement. The bargaining parties have been negotiating with each other for months. Again and again, the employee representatives had paralyzed administrations, city cleaning and swimming pools with nationwide warning strikes. At the end of March, Verdi, together with the railway and transport unions, brought both rail and air traffic to a standstill nationwide during a large-scale warning strike.
