World War II, Germany, And The German Democratic Republic

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After the World War II, Germany was divided into 4 powers, Britain, France, USA and Soviet Russia, dividing the country into two parts, namely East and West Germany. The country was reunited again in 1990, unifying the Federal Republic of Germany (FRG) and the German Democratic Republic (GDR) (kellerbook). The reunification has led to political, economic and social long-lasting changes in the country. Following the reunification, there has been an increase in unemployment rate and severe economic crisis. Since the 1990s, the issue of the fall in the number of union members and collective bargaining in Germany’s employment relationship is not a new matter (Addison This has been evidently observed, after the reunification of Western…show more content…
Before reunification, West Germany was experiencing economic growth with low inflation rates and increase in wage rate. The unification allows for East to be reunited with West Germany causing transfers of labour legislation, industrial relations to the east. The unemployment rate in the past 2 decades has been fluctuating and the highest unemployment rate since the reunification is at 11.2% in 2005.
Kotthoff (1981, in frege1) states that codetermination and collective bargaining are two alternative methods of institutionalizing collective conflict.
Since the 1990s, the rate of economic growth has been low and unemployemt, particulartly long-term unemployment has remained high.
Collective Bargaining

On the collective bargaining side, 2 changes were observed; a steady increase in the number of company agreements relative to sectoral agreements, especially in West Germany. Second, decreased in the membership rate of employers’ confederations. The decline in the coverage by German industrial relations institutions as a whole has coincided with greater pressure towards decentralization in collective bargaining. Regulated decentralization (via opening clauses, hardship agreements, and company-specific agreements) where the parties have sought to pre-empt pressures to decentralize collective bargaining by allowing for some differentiation while avoiding delegating decision-making rights on wages to plant level and actual
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