»Essential resource«

Germany Trade & Invest interviews Jörg Hofmann, chairman of IG Metall, Germany’s biggest trade union with over 2.2m members from the metal industries and also from electricals, clothing and textiles, wood, plastics, crafts and ICT. He praises the close partnership between employers and employees – which has a long history in Germany.

June, 2017

Mr. Hofmann, GTAI is tasked with bringing foreign direct investment to Germany, thereby creating and securing employment – so our goals are not dissimilar. How would you showcase Germany to foreign investors?

Firstly, I would point to our innovative and high-performance industries such as automobile production, machine building and chemical engineering, and emphasize how well qualified German industrial employees are. They are an essential resource when it comes to the implementation of digital transformation. Secondly, there’s the value added by social partnership – the benefits of participative management and co-determination. Participative companies are more innovative – a tangible advantage which is often overlooked.

Every time an overseas company sets up shop in Germany, the economy becomes a little more international. From the perspective of a trade union, why is internationalization so important?

When foreign investors adopt the German model, the whole of Germany benefits. Our model combines the development and production of the most innovative products with skilled craftsmen and stable employer-worker relations. Clearly defined rules and standards lead to reliable and structured work and pay conditions. On this basis, German companies and subsidiaries evolve to fulfill their potential and take on leading roles in the international workplace.

»When foreign investors adopt the German model of stable employer-worker relations,
the whole of Germany benefits.«

Jörg Hofmann, chairman of IG Metall

The synergistic relationship between employer and employee in Germany is regarded from outside with equal parts admiration and skepticism. How would you explain the merits of the German system to a British or American manager?

The merits are clear and economically tangible. Yes, we have an innovation culture, but there’s also a completely different approach to conflict. The term Konfliktpartnerschaft – a culture where neither employee nor employer gives ground to another within clearly-defined rules – encapsulates this well. We have scope for design within our tariff-based contracts. Our philosophy is to solve corporate and pay grade problems directly with the employers or their unions, without always invoking policy first.

The world is talking about Industry 4.0. Many view it as a critical step along the path of modernization, which would strengthen Germany’s position as a leading industrial location. But increasing automation is likely to have an impact on employment. So where do employers stand on this issue, and how would you like to influence the course of modernization?

I don’t think factories can ever operate without people. But we must also be aware that some jobs will not exist in the future. If we want people to have a place in the work environment of the digitalized future, they must be given the right qualifications. We need an increase in further education that is accessible to all, including lower-skilled and older workers. We want to make the workplace a place of learning – and this is an area where digital media can help.

If you were in our position – i.e. negotiating with a foreign company about an incoming investment opportunity – what questions would you ask the investor?

I would ask, “How will you cope with worker participation in your company?” and “How will you cope with the tariff commitments?” We are clearly tasked with ensuring that company owners are integrated into the participation and tariff-commitment systems when it comes to takeovers or new investments. This is also ultimately in their own interests.

Photo: Jörg Hofmann, chairman of IG Metall | © IG Metall

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