New metalworking agreement thrashed out: Collective bargaining round 2005 in Austrian metalworking and mining industry successfully concluded

After intense and difficult negotiations the joint negotiating team of the Austrian Metal and Textile Workers’ Union (GMT) and the Austrian White Collar Workers’ Union (GPA) reached an agreement with the sector’ s employers in the night from September 23 to 24 on wages/salary increases and improvements of non-wage terms for some 180.000 blue and white-collar workers in these sectors. This year’ s bargaining round was overshadowed by a markedly intense mass media attention.

Economic background: The bargaining round formally started with the traditional exchange of basic positions and assessment of the economic situation on September 16 against the background of a positive economic situation in the metal industry. The employers themselves presented the results of a survey, reflecting a quite favourable order situation of a number of enterprises in 2004 which is set to continue in 2005 ; they nevertheless pointed out to the difference between enterprises profiting from export growth and those suffering from internal sluggish market. Furthermore, the additional costs for enterprises arising from the introduction of a common pay system for blue and white collar workers should be taken into consideration.

Key macroeconomic data:

GDP growth: +1,8 % (2004: 2,2%)
Consumer prices: + 2,5 % (2004: 2,1%)
Productivity (GDP per employee): +0,8% (2004: 1,2%) and (per hour/manufacturing): +4,4% (2004: 4,6%)
Unemployment rate: +4,6%

Key results of the bargaining round:

Pay: * Increase in collectively agreed minimum wages/salaries by 3,1% (the new minimum wages thus stands at 1.319,29€) * Increase in effectively paid wages/salaries by 3,1% * Increase in apprentices’ remunerations by 3,1% * Increase in allowances for expenses incurred by 3,1% * the new agreement will come into effect on 1 November 2005

Pay harmonisation between blue and white collar workers The common pay system for blue and white collar workers, agreed during last year’ s bargaining round, will finally come into force on 1 November 2005. The introduction of a new modernised pay system marks the end of the traditional unequal treatment of blue collar workers also in terms of pay and job classification, while equal application of labour law was achieved by GPA and GMT gradually over the last years.

The new pay and grading system specifies • 11 newly designed grades • 5 automatic pay increments (increase) , fixed as a certain percentage of the collectively agreed minimum pay for each grade, with 2 higher and 3 lower pay increments • Pay increments (increases) in each grade will fall due after 2,4,6,9,12 years in a grade

The new system applies to all employees/workers, not only to newly recruited ones. Transitional provisions should guarantee that each worker will receive at least one pay increment (automatic pay increase) from 1 November 2005 till October 2008.

Non-wage terms

Working time

While the Chief negotiator of the employer himself pointed out that existing statutory and collectively agreed options for flexible working time arrangements are well used by most enterprises (about 75%) , the employers nevertheless presented a position paper on extension of working time flexibility. We finally succeeded in thwarting their demands, including extension of daily normal working time, redefining of bandwidth maximum limits, reduction of overtime premium and extension of reference periods with our unchanged resolve to oppose any kind of unilaterally imposed working time flexibility.

Extension of reference period for averaging out working time • Extension of reference period for averaging out working time to 38,5 from six to nine weeks, providing that hours per week can run to 48 without bonus. Hours that could not be averaged out attract overtime premium. Car mileage allowance • A rise in car mileage allowance will fall due as soon as new statutory regulations will come into force which merely apply to taxation and do not entail any entitlement to higher car mileage allowance. This provision aims to alleviate the massive burden, caused by the soaring fuel prices.