collective agreement and amount of payment
Julia wants to know how much she can expect to receive as a salary in her new job. She has heard collective agreements are connected to the salary. But it seems all very complicated...
Don’t worry we will work everything out together!
The amount of remuneration for a professional activity is usually specified in the employment contract.
It can be freely agreed, unless there are special regulations. In many countries, for example, a minimum wage has been introduced, which determines the minimum level of remuneration an employee must receive.
Remuneration below the minimum wage may not be agreed in an employment contract.
In principle, the better qualified Julia is, the higher the remuneration.
As an unskilled worker she earns less than as a skilled worker, as a master craftsman more than as a journeyman and as a long-time employee more than as a newcomer with the same professional qualification.
The degree of responsibility that Julia bears can also influence the remuneration. As a construction worker who leads a column of several colleagues she is better paid for the responsibility she bears than equally qualified colleagues from the column.
In the 19th century, industry in Europe grew very fast and factory owners needed a large workforce.
The workers, often poor people from rural areas, had to accept the wages of the employers if they wanted to work. This led to extremely low wages and great poverty among the workers.
These workers then formed trade unions and demanded higher and, in particular, fairer wages.
As a trade union, i.e. an association of many workers, they were able to persuade the employers e.g. through protests or strikes to pay better.
This led to collective agreements, in which the level of pay for the employees of an entire company, industry or country is determined between the employer and the unions.
However, a collective agreement does not only define the amount of the remuneration. It generally describes the rights and obligations of Julia and her employer.
For example, Julia has the right to be paid at a level agreed between the parties to a collective agreement, while she has the obligation to observe agreed working hours.
Holiday entitlement and working conditions are also laid down in the collective agreement. For example, it must be explained that not all employees are entitled to the same amount of leave per year.
It is also often the case that employees also have different weekly working hours: One has a 40-hour week, while another has to work 38.5 hours a week.
If no collective agreement exists for a company, industry or region, it is common practice to determine an appropriate remuneration.
This is based on the remuneration for similar or identical activities in the same region.
In these cases, the personal situation of the employee is also taken into account in determining the salary: age, professional experience, marital status and the number of children can influence the amount of the salary.