Sections

German union to exert pressure

Three million German employees could have the possibility to join funded pension schemes within the next few months under pensionskasse or new ‘pensionfond’ arrangements being negotiated by the world’s largest trade union, Hamburg-based ver.di.
The negotiations follow the ratification of the new German pensions law of German labour minister Walter Riester.
Magret Mönig-Raane, a vice president at ver.di, says the union is currently in discussion with employers and demanding that they offer contribution possibilities to some form of pension plan.
Mönig-Raane notes that while under the new law individuals may wish to take out a private insurance contract, the union is seeking to introduce collective agreements to ensure parts of the workforce can access appropriate retirement cover.
“One way to do this is to start a pension fund – there are some and we have seen some contracts like this.
“I think they will be built within the next few months because banking and insurance groups will create them to offer to social partners.
“The second way is the Pensionskasse, where there is a difference in regulation that caps equity investment to 30-35% and the rest has to be in lower risk securities.
“The unions, and ver.di says this also, prefer low risk investment and we are also looking at the share investment going into companies that respect ILO convention on issues such as non-investment in child labour. Companies will also have to accept union rights and so on.
“We are discussing with employers to make these agreements with us in the next one to two months and we have not said no to pension fund arrangements.”
But she adds that in the wholesale employment sector agreements were reached with employers last year for Pensionskasse plans.
The union is unsure how many participants will finally be covered: “Because it is an optional saving we can’t really say how many people will be in there.
“It also depends if there is a works council or not, because a lot of employers don’t explain this to their workers because they hope to save money. So it is very difficult to say,” says Mönig-Raane.
However, she states that the union is pressuring employers to make a contribution.
“We are demanding that this happens, especially that part the employers save because they no longer pay the social insurance.
This, she notes would normally be around 20% of pay.
Retail, wholesale, banking and insurance sectors are negotiating such agreements, says Mönig-Raane, adding that ver.di will be seeking similar negotiations for journalists, printers, airlines, transport and health workers. “There are a lot of talks to take place.”

Have your say

You must sign in to make a comment

IPE QUEST

Your first step in manager selection...

IPE Quest is a manager search facility that connects institutional investors and asset managers.

  • QN-2466

    Asset class: Multi-asset funds.
    Asset region: Global.
    Size: EUR 30m.
    Closing date: 2018-08-16.

  • QN-2467

    Asset class: Search for a broker (mainly ETFs).
    Asset region: Global.
    Size: 250m.
    Closing date: 2018-08-28.

  • DS-2468

    Closing date: 2018-08-24.

Begin Your Search Here