Opt-out clauses and wage flexibility - New evidence based on linked employer-employee data

Abstract

"Opt-out clauses within centralised collective bargaining agreements allow firms to deviate from wages and standards stipulated in centralised agreements. Given that such flexibility provisions have gained considerable importance in German wage determination, this article studies the association between the existence and use of opt-out clauses and the level and structure of wages. Of particular interest is the question whether opt-out clauses are associated with a greater responsiveness of wages to firm-specific profitability conditions. To address these issues, we examine German linked employer-employee data from 2005 and 2007, which provide information on individual wages along with information on profitability, collective bargaining coverage and opt-out clauses at the establishment level. Overall, our results confirm earlier evidence indicating that - compared to contracts without any flexibility - wages under contracts with existing opt-out clauses are more responsive to local profitability conditions in establishments performing below average. These findings are found to be robust to estimating first-differenced specifications." (Author's abstract, IAB-Doku) ((en))

Cite article

Garloff, A. & Gürtzgen, N. (2015): Öffnungsklauseln und Lohnflexibilität: Neue Evidenz auf Basis von verbundenen Betriebs-Beschäftigtendaten. In: Industrielle Beziehungen, Vol. 22, No. 3/4, p. 217-239. DOI:10.1688/IndB-2015-03-Garloff