ABSTRACT
West Germany’s post-war growth strategy was based on a specific Fordist wage determination process. This was done by separating the sector level, where wages and the length of collective agreements were discussed (Tarifvertragssystem) from the company level, where daily work relations were addressed (Betriebliche Mitbestimmung). Even though there was no wage bargaining at the social level, wages were normally negotiated for one sector in one federal state (Bundesland) – often in the metal industry in Baden-Württemberg – and the result served as a model for further bargaining rounds in other federal states and in other industries. Since these bargaining rounds did not result in great differences from the original wage level, a general distribution of wage norms was ensured. Collective agreements (Flächentarifverträge) were negotiated between the trade union and employer’s organization representing the relevant sector. While these agreements defined minimum standards in relation to wages, working hours, holidays, dismissal protection, and so on, arrangements within individual companies were made at the level of work councils (Betriebsräte). General agreements were therefore interpreted and implemented extremely heterogeneously at company level, an issue that is often underestimated (Ganßmann and Haas, 1999, p. 151). This is also stressed by the Sachverständigenrat (a think-tank of economists that advises the government): the lack of flexibility at company level is often caused not by restrictions resulting from agreements at sector level but rather from the utilization of flexibility within these agreements by the companies themselves (Sachverständigenrat, cited in Ganßmann and Haas, 1999, p. 151). Furthermore, it was possible to include particular cases where a company could legally deviate from the collective agreement, known as ‘opening clauses’ (Öffnungsklauseln).
