What are collective agreements? Simply explained

Whether you are currently looking for a new job or want to find out about your rights and working conditions in an employment relationship - collective agreements are the answer! 

Collective agreements have been enshrined in law since 1949 and create clear rules that ensure order and fairness between employers and employees. This is why they have been an integral part of the world of work ever since. 

In this article, we explain everything you need to know about collective agreements and what you need to know as a skilled worker.

What is a collective agreement?

A collective agreement sets out general standards for pay, working hours and working conditions and applies to many employees in an industry or company. Employers (associations) and trade unions negotiate these rules together. Your individual employment contract is based on the provisions of the collective agreement and supplements them with personal details so that not everything has to be negotiated individually.

How are collective agreements created?

Collective agreements are concluded in negotiations between trade unions (employees) and employers' associations. Both sides represent their interests and reach an agreement after several rounds of negotiations. A new collective agreement is concluded when the old one is terminated at the end of its term and adjustments are negotiated.

Would you like to terminate your collective agreement but have no idea how to prepare it properly? Take a look at our tips on termination.

To whom do collective agreements apply?

A collective agreement applies to you as an employee if:

• Your employer is bound by a collective agreement: This means that your employer is a member of an employers' association that has concluded the collective agreement.
• You yourself are bound by a collective agreement: This means that you are a member of a trade union that has negotiated the collective agreement.
• Generally binding: Even if you or your employer are not directly bound by a collective agreement, the collective agreement can be declared generally binding by the Federal Ministry of Labor and Social Affairs. This means that it then applies to all companies and employees in a specific sector.

What types of collective agreements are there?

There are different types of collective agreements that stipulate different regulations depending on their content and scope:

• General collective agreements: These regulate the general working conditions, such as working hours, vacation days, notice periods and break regulations and are therefore the basis of your collective agreement.
• Framework collective agreements: These determine the classification of activities, qualifications and salary groups. They regulate which salary level you are assigned - depending on your qualifications and experience.
• Collective wage agreements: These determine the specific salary you earn. They are regularly renegotiated.
• Company collective agreements: These only apply to a specific company and are negotiated between the company and the trade union.
• Association collective agreements (regional collective agreements): These apply to an entire industry or region and are concluded between trade unions and employers' associations.

Collective agreements play a special role for the skilled trades in particular, as they set industry-specific standards. Would you like to find out more? Then take a look at everything you need to know about collective bargaining in the skilled trades here.

What exactly does the collective agreement regulate?

A collective agreement covers many important areas of everyday working life:

• Salary: In collective agreements, there are clear salary levels that are based on your professional experience, qualifications and activities. This means that the salary is set transparently and fairly for everyone. Important: If your employment contract provides for a higher salary, the higher salary remains in place because the better conditions always apply (principle of favorability).
• Working hours: The working week is often between 35 and 40 hours. Breaks and overtime are also clearly regulated. Overtime is either paid or compensated by additional time off.
• Vacation:Collective agreements usually offer more vacation than the statutory minimum of 24 days. You often have 30 vacation days a year, for example in the public sector. This means more rest for you.
• Supplements: There are clearly regulated extra payments for, among other things, overtime, night work or work on public holidays. For example, night shifts can be paid at a 25% premium and Sunday work at 50%. In this way, you will be rewarded additionally for these burdens.
• Notice periods: The notice periods in collective agreements are often longer than required by law. Instead of four weeks, three months or more often apply, depending on how long you have been with the company. This gives you more security.
• Special payments: Christmas bonuses and vacation pay are stipulated in many collective agreements. You often receive an additional 50% to 100% of your monthly salary. These payments are a bonus that gives you more financial security.

Find out about the exact regulations in the collective bargaining register of the Federal Ministry of Labor and Social Affairs (BMAS). All collective agreements are recorded here and are publicly accessible. You can also access current collective agreements on the websites of trade unions such as IG Metall . 

Why are collective agreements important?

Collective agreements offer numerous advantages to both employees and employers. Clarity and security are created for employees. With collective agreements, you benefit from fair conditions, regular salary adjustments and additional protection against changes that could make working conditions worse for you.

As an employee, you should therefore ensure that the provisions of the collective agreement are implemented correctly.

This means

• Compliance with standards: All regulations stipulated in the collective agreement must be taken into account in the employment contracts.
• Regular adjustments: Collective agreements are regularly renegotiated. It is important to keep up to date with changes and implement them.
• No discrimination against employees: Deviations are only permitted if they are in favor of the employees.

Collective agreements and WorkerHero - your start into the future

A collective agreement ensures fair conditions in your job. At WorkerHero, we not only support you in your job search, but also in understanding your working conditions. 

We are at your side so that you can start your professional future safely and well informed. Register with WorkerHero now and find not only your next job, but also the support you need to get off to a fair and successful start!