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Deutsche Bahn Reaches a Deal

Unions Win 4.5 Percent Wage Hike

After a marathon session of negotiations, Deutsche Bahn has reached a deal with two of its trade unions on a 4.5 percent pay rise for its workers. But another union is sticking to its demands for a 31 percent hike and threatening more strikes on Tuesday.

Industrial relations in Germany are a relatively civilized affair, but with signs that the economic corner has been turned, the country's workers are now clamoring for a slice of the growing pie. Last week a series of strikes upset German rail traffic, but after marathon talks that went well into the early hours of Monday morning, a deal has been hammmered out. Germany's rail operator Deutsche Bahn has agreed to pay higher wages to workers in two unions, but a third -- representing train drivers -- is holding out for an incredible 31 percent wage hike.

Deutsche Bahn announced an agreement with the Transnet and GDBA trade unions on a 4.5 percent wage hike for their members. CEO Hartmut Mehdorn confirmed at midday in Berlin that 134,000 employees would see a 4.5 percent boost in wages over the next 19 months.

"This is one of the highest settlements to have been reached in Germany all year," Mehdorn said on Monday. But he admitted that in light of the modest raises the employees were given in recent years it was "acceptable." According to Mehdorn the minimum increase would be worth €1,600 ($2,177).

Union boss Norbert Hansen of Transnet welcomed the agreement and said that in light of Deutsche Bahn's "excellent profits" in the last financial year the workers were entitled to their share. "It was only logical," he said. The long-awaited economic revival in Germany is prompting workers to push for wage increases in many different sectors. For example, the country's biggest union, IG Metall, has secured a 4.1 percent rise this year and another 1.7 percent next year for manufacturing workers.

The two unions that reached the deal with Deutsche Bahn had called for a 7 percent increase -- or at least €150 more a month. The first counter-offer from the company had been two raises of 2 percent, plus a one-off payment of €300 over 30 months.

The unions were unimpressed. Last week Germany was thrown into commuter chaos when they launched a series of strikes to pressure Mehdorn for a better offer. By Sunday at midnight, the company had inched to a 3.9 percent increase. This was rejected. On Monday, however, 4.5 percent was enough to satisfy both unions. The increase will come into effect on Jan. 1, 2008, but the employees will also get a €600 one-off payment to compensate for the second half of 2007.

The company's train drivers, though, are organized in a third union. They're thinking much bigger. The GDL union has not taken part in the negotiations with the other two unions, preferring to go it alone and demand a whopping 31 percent raise. And it is likely that Germany's commuters -- on long-distance as well as S-Bahn lines -- will face another morning of disruptions on Tuesday as GDL vowed to mount another strike.

Mehdorn has rejected a separate deal. "We've got one staff, and even though we accept that there are a number of different unions, we won't accept the creation of two separate staffs," he said. "We don’t want a two-class system of workers."

smd/reuters/ap