Uncovered workers in plants covered by collective bargaining: Who are they and how do they fare?

Arbeitspapier

In Germany, employers used to pay union members and non-members in a plant the same union wage in order to prevent workers from joining unions. Using recent administrative data, we investigate which workers in firms covered by collective bargaining agreements still individually benefit from these union agreements, which workers are not covered anymore, and what this means for their wages. We show that about 9 percent of workers in plants with collective agreements do not enjoy individual coverage (and thus the union wage) anymore. Econometric analyses with unconditional quantile regressions and firm-fixed-effects estimations demonstrate that not being individually covered by a collective agreement has serious wage implications for most workers. Low-wage non-union workers and those at low hierarchy levels particularly suffer since employers abstain from extending union wages to them in order to pay lower wages. This jeopardizes unions' goal of protecting all disadvantaged workers.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: FAU Discussion Papers in Economics ; No. 02/2022

Classification and Topics

• Classification: Wirtschaft ; Wage Level and Structure; Wage Differentials ; Labor-Management Relations; Industrial Jurisprudence
• Subject: collective bargaining ; union wage ; uncovered workers ; Germany

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Hirsch, Boris ; Lentge, Philipp ; Schnabel, Claus
• Event: Veröffentlichung
• (who): Friedrich-Alexander-Universität Erlangen-Nürnberg, Institute for Economics
• (where): Nürnberg
• (when): 2022

Further information

• Handle: http://hdl.handle.net/10419/251205
• Last update: 10.03.2025, 11:42 AM CET