Wage Negotiations Heat Up in Fast-Food Industry

Fri 31st Jan, 2025

The fast-food sector in Germany is currently embroiled in a significant wage dispute, particularly affecting major chains such as McDonald's, Burger King, and Starbucks. The union for food industry workers, known as NGG, is advocating for an increase in the hourly wage from the current rate of approximately EUR13.02 to EUR15.

This ongoing conflict, which has persisted for six months, stems from the union's push for improved wages for around 120,000 employees across the system catering sector. The current standard wage, set at EUR13.02, is viewed as insufficient given the rising costs of living and the increasing demands placed on workers.

As discussions continue, the system catering employers have cited significant challenges, including the recent reversion of the VAT rate to 19% in early 2024, which they claim has adversely affected their operations. The industry has also been grappling with rising operational costs and a decline in customer traffic.

In December, employers proposed a wage increase of 14.1%, which, at first glance, appeared beneficial. However, this proposal included adjustments for the legal minimum wage increase, which rose from EUR12.41 to EUR12.82 in January. Consequently, the minimum wage for the sector was automatically adjusted upward from EUR12.61 to EUR13.03, a move that the NGG deemed inadequate for meeting the current economic challenges faced by workers.

NGG's chairperson highlighted the increasing pressures on fast-food employees, noting that staff at McDonald's have an average of only 106 seconds to complete incoming orders. This heightened pace, coupled with a workforce often comprised of part-time employees, has led to growing dissatisfaction among staff, especially as major corporations continue to report record profits.

Earlier this month, the NGG organized a protest day to call attention to these issues, emphasizing the need for better working conditions and fair compensation. In light of these developments, the union has seen an influx of new members, with about 1,000 workers from the hospitality sector joining in recent months.

Employers have also recognized the necessity of reaching a new collective agreement, particularly in response to the union's threats to negotiate local agreements in regions where they have significant member presence, which could be more costly for businesses than broader sector agreements.

Looking ahead, the anticipated increase in the legal minimum wage to approximately EUR14 by 2026 is a further motivation for employers to negotiate. The minimum wage commission is expected to discuss future increases in June, with projections indicating a phased approach toward a EUR15 minimum wage by 2027.

In conclusion, as wage negotiations continue, both parties appear to be seeking a compromise. The union is advocating for a more substantial increase, while employers are attempting to balance financial viability with the need to attract and retain workers in a challenging labor market.


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