Collective bargaining: Deutsche Post and ver.di agree on Generations Pact for age-based career solutions

  • Flexible and trendsetting model for age-based working solutions agreed
  • Long-term employment pact extended to the end of 2015
  • Starting wage for new employees to be lowered by 4 percent
  • Key contribution to sustainable stabilization of MAIL Division earnings

Bonn/Berlin, 10/06/2011, 02:30 PM CEST

Mailman in front of the Group's headquarters

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The two sides have worked out a flexible and trendsetting model for age-based working solutions.

Deutsche Post AG and the United Services Union ver.di reached an agreement ahead of schedule today on a comprehensive package that will strengthen the long-time foundation of the company’s mail business. In the collective-bargaining negotiations covering the company’s approximately 130,000 employees in Germany, the two sides have worked out a flexible, trendsetting model for age-based working solutions, an extension of the company’s employment pact and the introduction of an entry-level wage for new employees that has been lowered by an average of 4 percent.

“The agreement makes a critically important contribution to stabilizing earnings in the MAIL Division at EUR 1 billion over the long term. It creates the leeway that the company needs to respond to future trends in a shrinking postal market,” said Frank Appel, CEO of Deutsche Post DHL. “As a result, we strengthen our competitive position and secure jobs.”

Trendsetting Generations Pact

The Generations Pact enables older employees to work actively until they reach the legal retirement age and thus preserves their knowledge and experience for the business. At the same time, the agreement generates employment opportunities for young people: More than 1,000 qualified trainees will be taken over next year while at least 1,500 part-time employees will receive a permanent employment offer at the end of 2011.

The partial-retirement program available under German law will be supplemented by so-called working-time accounts and a demographic fund. Working-time accounts enable employees to build up a balance of time during their active professional lives that can then be applied toward non-working periods.

For the first time, Deutsche Post is setting up a so-called demographic fund. The company will use contributions from this fund to increase payments received by employees in the partial-retirement program. The amount of the contribution will be linked to the extent that portions of future wage increases are reallocated.

“During the negotiations, we ventured into absolutely new territory at times,” said Walter Scheurle, Member of the Management Board responsible for Personnel at Deutsche Post DHL. “By developing the working-time accounts and the demographic fund, the negotiating parties have added a novel tool to the current system of collective-bargaining agreements. It creates new organizational approaches and offers attractive models to older employees that will allow them to remain at the company until retirement by working shorter hours.”

Wage system for new employees restructured

The negotiating parties also reached agreement on the introduction of new entry-level wages at Deutsche Post in Germany. As part of this contract, the wages for new employees will be lowered by an average of 4 percent. A newly appointed mail carrier, for instance, will earn EUR 10.70 an hour in the future compared with EUR 11.13 an hour at the moment.

Job security and work schedules

The current employment pact – i.e. the decision to avoid enforced redundancies – will be extended to December 31, 2015. Agreements covering non-chargeable overtime, the decision to designate Christmas Eve and New Year’s Eve as work days and to reduce short breaks, will remain in place as well.  Furthermore, the negotiating parties worked out new vacation policies that are based on Germany’s General Equal-Treatment Act and will take effect on January 1, 2012. These policies will be based on company service and not age.

Outsourcing

A total of 990 parcel-delivery districts will continue to be handled by subcontracted service partners. The company’s outsourcing practice will be expanded in the transport area: As a result, the number of the company’s own drivers will be reduced from the current total of 3,600 to 2,600 by 2015. As before, no mail delivery districts will be awarded to subcontractors. All policies applying to subcontractors will remain in effect through December 31, 2015.

Should the MAIL Division’s earnings significantly worsen, Ver.di has agreed to enter into discussions designed to jointly review the situation and work out suitable countermeasures. Collective-bargaining negotiations for postal employees’ wages and salaries will begin in January 2012.