Bundesinstitut für Berufsbildung (BIBB)

Germany has had collective agreements on measures to foster training in a growing number of collective bargaining sectors since the mid-1990s. Through these agreements, labour and management hope to alleviate the often difficult situation on the training-place market and help improve young people's chances of being hired upon completion of their in-company training. A total of 121 agreements on measures to foster training were in force in 2003, twice as many as in 1996. These agreements applied to some 9.9 million employees in 2003 - 37 per cent of all employees in Germany who were subject to social insurance (27 million). ⁰¹

The Federal Institute for Vocational Education and Training ("BIBB") is currently studying the short-term and long-term trends in collective agreements on measures to foster training in a project that is being funded by the Federal Ministry of Education and Research ("BMBF"). This study is based on the extensive documentation of collective agreements on measures to foster training that the Institute of Economic and Social Research of the Hans Böckler Foundation produces on behalf of BIBB for each round of negotiations. This report briefly outlines relevant developments since 1996. It then describes the patterns and focus of collective agreements on measures to foster training in 2003 and presents two substantively new agreements that could serve as models.

 
Collective agreements on measures to foster training - Longer-term view

The primary aims of collective agreements on measures to foster training are to maintain or increase the number of in-company training places and to either ensure that individuals who complete in-company training are subsequently hired by the company providing their training or to increase the number of trainees being hired. Many collective bargaining agreements target both of these aims. Some of them however focus on only one. There have however been marked shifts in priorities over the years: The lion's share of agreements during the years 1997 through 1999 targeted both aims. By contrast, a relatively large portion of agreements in the following years confined themselves to the second aim - increasing the number of trainees who are subsequently hired by the company providing their training.

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Collective agreements on measures
to foster training - Broken down by
primary goals - 1996 through 2003

On the other hand, agreements that pursued only the first aim - maintaining or increasing training capacity - became progressively less significant through 2001.

Looking at how collective agreements on measures to foster training have developed over the years, it is striking that the number of agreements has grown enormously while the overall number of employed persons in the sectors covered by these agreements has remained almost unchanged. Two factors played a role here: The number of employees in many of the sectors covered by collective agreements declined. At the same time, most of the new agreements applied to generally smaller sectors. Over the years, there has been a changing succession of collective bargaining sectors in which agreements on measures to foster training were reached. A relatively large number of sectors had such agreements for only a few years.

Twenty-five of the agreements on measures to foster training in effect in 2003 targeted only the first aim while 57 focused exclusively on the second. Thirty-nine were geared to both aims. All in all, the more important aim was that of either ensuring that companies subsequently hire their trainees upon completion of training or increasing the number of trainees being hired by their companies. This is particularly clear from employee numbers. Interestingly, these figures show that the focus in collective agreements on measures to foster training in 2003 was nearly identical with the focus seen back in 1996.  

 
Patterns in collective agreements to foster training in 2003

The largest number of agreements in 2003 - 55 - was concluded for collective bargaining sectors or enterprises in western Germany which accounted for only 1.8 million employees. Twenty-six agreements applied exclusively to collective bargaining sectors or enterprises in Germany's eastern states (scope of application: 0.5 million employees). The most important agreements in terms of sector size were the 40 that applied to collective bargaining sectors in both eastern and western Germany or to enterprises with sites throughout the country (scope of application: 7.7 employees).
Trade and industry accounted for the largest number of collective agreements on measures to foster training by far: a total of 98 agreements (scope of application: 6.6 million employees). Thirteen agreements targeted the skilled trades - or the skilled trades together with trade and industry (scope of application: 0.8 million employees). The remaining ten agreements applied to other miscellaneous sectors (scope of application: 2.6 million employees).

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Collective agreements on measures to
foster training - Broken down by
economic activity - 2003

A breakdown by industry shows that most of the collective agreements on measures to foster training applied to the manufacturing sector - a total of 68 agreements in 2003. The metal-processing and electrical engineering branches of this sector accounted for a particularly large share of these. Agreements that were applicable to central, regional and local government (public administration) and to compulsory social security were also relatively important.

 
Priorities in 2003

The first aim of collective agreements on measures to foster training - in other words, maintaining or increasing in-company training capacity levels - was an integral element in a total of 64 agreements. Most of these stipulated increasing the number of training places, albeit without prescribing any numbers. By contrast, just under one quarter of the agreements specified either the targeted number of additional training places to be created or the overall targeted number of training places. Some agreements sought to maintain existing training capacity levels.

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Agreements targeting Goal 1
"Increase or ensure level of in-company
traning capacity" - Broken down
by provision - 2003

Furthermore, eight agreements were aimed at particularly motivating individual companies in a collective bargaining sector to make additional training places available. Under these agreements, individual companies that provided training would be eligible for financial relief upon meeting requirements regarding the number of persons they trained. In most cases, the respective firm had to increase its number of training places by a certain percentage or achieve a specified training rate in order to qualify for the relief - which usually took the form of a reduction in the level of the training allowance they were to pay.
A total of 96 agreements incorporated the second aim of collective agreements on measures to foster training, namely: to ensure that individuals who complete in-company training are subsequently hired by the company providing their training or to increase the number of hirings. Most of these agreements specified the minimum duration of employment. Only four agreements provided for former trainees being hired for an indefinite period. Nearly all the remaining agreements foresaw hiring former trainees for a minimum of six or twelve months.

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Agreements targeting Goal 2 "Ensure
hiring of trainees / Increase number of
trainees being hired" - Broken down
by provision - 2003

Although such agreements required companies to hire trainees upon completion of training, there were also exceptions in many collective bargaining sectors. In many cases, firms had to hire their one-time trainees only when their financial situation permitted it and/or when they had not provided training for more individuals than they actually needed. In some collective bargaining sectors, the requirement to hire trainees upon completion of their training was made contingent upon the individual's suitability and, in some cases, on their willingness to move or their level of flexibility.

Rather than specifically requiring enterprises to hire their trainees upon completion of training, the agreements in nine collective bargaining sectors contained other provisions. The most important of these foresaw relief for firms in the form of lower starting wages and salaries to make it easier for them to hire former trainees. These agreements did not include provisions requiring the hiring of former trainees.

In some of the collective bargaining sectors where collective agreements on measures to foster training targeted both aims, the respective agreement included a statement of the principle "Training takes precedence over hiring" thus giving clear priority to making training places available. Here companies were called upon to provide training for as many trainees as possible, even when the individual firm did not expect to be able to hire them all. Of the 39 agreements that targeted both aims, 15 contained a declaration of the principle of giving training priority over hiring (scope of application: 1.4 million employees).

In order to make it easier for firms to provide training places or to hire trainees upon completion of their training, one third of the collective bargaining sectors with agreementss on measures to foster training also arranged to grant general financial relief to enterprises providing in-company training. Twenty-nine out of a total of 121 agreements contained provisions to ease training companies' burden with respect to training allowances (scope of application: 1.1. million employees). In most cases, training allowance levels were raised only after a specified period of time and were even frozen in some cases. Eleven agreements that allowed firms to reduce the level of their training allowances on condition that the respective enterprise provided a certain number of training places are not included in this figure. These latter agreements provided for reducing the financial burden on companies that hire their trainees. This was to be achieved by lowering the starting wages or salaries of individuals who had been hired following completion of their training (0.8 million employees). In most cases, the starting pay levels were five or ten per cent lower than normal in the first year of employment and in some cases during the second year as well.

The degree to which agreements on collectively negotiated measures to foster training are obligatory is crucial to their effectiveness. The spectrum here ranges from agreements that are binding under collective bargaining law all the way to mere appeals or recommendations that the parties to the collective agreements direct at enterprises that provide in-company training. Looking at the degree to which these arrangements were binding, a breakdown of the 64 agreements that pursued the first aim - in other words, maintaining or increasing training capacity - reveals that binding collective agreements or commitments were reached in 18 collective bargaining sectors (scope of application: 1 million employees). Ten collective bargaining sectors had declarations of intent (scope of application: 0.5 million employees). Thirty-six relied solely on appeals and recommendations or used only options aimed at relieving the financial burden on firms (scope of application: 4.6 million employees).

In the case of the 96 agreements that targeted the second aim - ensuring or increasing the hiring of trainees upon completion of their training - 57 were binding collectively negotiated agreements or commitments (scope of application: 4.7 employees). Declarations of intent were issued in 12 collective bargaining sectors (scope of application: 0.3 million employees). Labour and management in 27 collective bargaining sectors restricted themselves to appeals, recommendations or arrangements for easing the financial burden on firms (scope of application: 4.2 million employees).

These findings show that collective agreements on measures to foster training frequently have relatively little binding character. In many cases, they revolve around voluntary commitments at political / collective bargaining level and do not establish any legally actionable claims, as collective wage/salary agreements or umbrella agreements do. In many cases, these agreements do not cover important details, particularly in the area of procedure or implementation.

 
Good practice examples

Detailed, binding agreements that also included, for example, procedures for auditing compliance with the agreed objectives were signed in some collective bargaining sectors in 2003. The chemical industry in western Germany, for instance, negotiated a collective agreement on increasing the number of training places on offer. This agreement contained the following provisions:

Excerpt from the Securing the Future through Training collective agreement from 8 May 2003 for the chemical industry in Germany's western states

 Section 1 - Training places on offer

(1) As provided in this collective agreement, employers in the chemical industry shall undertake to increase the number of training places they offer.

(2) The size of the increase for the 2004 training year shall be 1.7 per cent of the reference number for the 2003 training year as calculated under Section 3.

(3) The parties to this collective agreement shall take up negotiations on the question of future increases through the year 2007 in conjunction with the respective round of wage negotiations.

Section 2 Supporting measures

1) The implementation of this obligation shall be coordinated at national level and supported through the use of suitable measures that are in line with conditions in the respective company and region and that actively incorporate the regional round table for labour market issues. Supplementary to this collective agreement, the parties hereto have issued separate recommendations for such measures.

(2) Employers and works councils may arrange for deviating training allowances in order to harmonize differences in training allowances within training networks when this is done in accordance with Section 76, Para. 6 of the Industrial Constitution Act (Betriebsverfassungsgesetz) and with the approval of the parties to the collective agreement.

Section 3 - Base numbers

(1) For the purposes of this collective agreement, a training place on offer is the advertising of a training contract or the offering of a training contract to an individual applicant for

• trainees as defined by the Vocational Training Act,
• students enrolled in "dual" courses of study (courses of study that are integrated into vocational training programmes, colleges of advanced vocational studies, commercial colleges) and
• concluding a contract for measures aimed at preparing youths for vocational training or at integrating them, including measures under the collective agreement to foster the integration of young people.

This also includes the training places offered by training facilities on behalf of enterprises in the chemical industry or an employers' association in the chemical sector.

(2) The reference number under Section 1 for the entire 2003 training year shall be calculated using a standardized method for the geographical area covered by this collective agreement. Employers shall be required to report the number of training places they have on offer for the 2003 training year to their employers' association by 31 October 2003. After coordinating the results with respective state districts, the employers' associations shall forward them to the parties to the national collective bargaining agreement. These parties shall determine the binding base numbers in December 2003.

(3) The number of training places on offer in the following training years shall be determined correspondingly.

Section 4 - Standard rule

Should the number of training places made available for the 2004 training year fall short of the number committed to under Section 1, the parties to this collective agreement shall immediately enter into negotiations with the aim of improving the number of training places on offer.

An agreement was reached for the metal-processing industry in Lower Saxony in 2003 which not only stipulated the exact targeted increase in the number of training places in the collective bargaining sector but also offered firms a special incentive in the form of financial assistance to induce them to generate additional training places. In their negotiations, the parties came to the following agreement on measures to foster training:

Excerpt from the results of the negotiations for the metal-processing industry of Lower Saxony from 2 June 2003:· 

• Revised version of Section 3 (Fostering training) of the collective agreement on safeguarding jobs that was extended to 30 June 2005:  
  "The parties to this collective agreement shall work on the assumption that for the years 2003 and 2004 the association's member firms shall each make available 1,107* training places multiplied by an employment factor**.
  The parties to this collective agreement shall undertake to foster training in IT occupations in particular in order to make innovative training places available." 
  
  Note:
  * The parties to this agreement shall review this number as of 1 November in November 2003 and November 2004. The number of training places for the first year of training shall be used as the basis for this comparison.
  ** The employment factor is calculated using the ratio of employees in the years 2003 - 2004 to the base year 2002. 
• In order to reach this goal in 2003, the employers' association shall undertake to make available € 1 million for creating incentives to offer additional training places (€ 10,000 per additional training place in accordance with the resolution of 20 May 2003).

The agreements for the chemical industry in western Germany and for the metal-processing industry in Lower Saxony were not typical of the collective agreements on measures to foster training that were concluded in 2003. They are exceptions that can be considered examples of good practice.

Literature:

• Ursula Beicht, Klaus Berger, Reinhard Bispinck, Johannes Kirsch
  Tarifliche Ausbildungsförderung - Entwicklung der Regelungen von 1996 - 2001 und Einschätzung ihrer Wirksamkeit. Federal Institute for Vocational Education and Training (ed.): Berichte zur beruflichen Bildung Heft 263 (Reports on Vocational Training, Vol. 263), Bielefeld 2004
• Ursula Beicht, Klaus Berger
  Tarifliche Ausbildungsförderung. In: Berufsbildung in Wissenschaft und Praxis, Special Issue 2003, pp. 24-27
• Ursula Beicht, Klaus Berger
  Tarifliche Ausbildungsförderung im Jahr 2000. In: Berufsbildung in Wissenschaft und Praxis, Issue 5/2001, pp. 36-40

footnotes:

⁰¹ The number of trainees in the sectors covered by the collective agreements is not known. The quantitative importance of the respective collective bargaining sector can be estimated only on the basis of the number of employees in them.

Erscheinungsdatum und Hinweis Deutsche Nationalbibliothek

Publication on the Internet: April 14, 2005

URN: urn:nbn:de:0035-0136-3

Die Deutsche Bibliothek has archived the electronic publication "Current trends in collective agreements aimed at fostering training", which is now permanently available on the archive server of Die Deutsche Bibliothek.

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Last modified on: November 22, 2011