Breakthrough in Sales Tax Dispute: Hamburg Model Agreement Reached in Retail Sector

Hamburg. For months little movement was made in the sales tax dispute. The first agreement in the area of ​​tariffs has now been achieved. It could be a model for all other areas.

The general bargaining conflict in the retail sector could be close to a solution across the country. An agreement has been reached for the Hamburg bargaining area which provides for significant wage increases in several stages. The Verdi union and the trade association then discussed progress.

Verdi was confident that general agreements based on the Hamburg model would be concluded in the other provinces. The retail sector in Germany has around five million employees.

Salary increase in three stages

For around 90,000 workers in Hamburg’s retail sector who are subject to social insurance contributions, a salary increase has been approved in three stages, as announced by Verdi and the Northern Trade Association: by 5.3 percent on October 1 2023 and by 4.7 percent on May. 1, 2024. In the third tariff year – from May 1, 2025 – the taxes will increase first with a fixed amount of 40 euros and then with another 1.8 percent. The agreement was reached late Wednesday night after negotiations that lasted more than a year.

“This collective agreement represents an important step for workers in the Hamburg retail sector,” said Heike Lattekamp, ​​the union’s negotiator and deputy regional manager in Hamburg. “The workers finally have more money in their pockets and obvious relief as a result of the high prices.”

Inflation compensation premium and retirement provision

Depending on each side, employers will pay an additional inflation compensation bonus of 1,000 euros for full-time employees and pro rata for part-time employees as of June 1, 2024. From January 1, 2025, employees should 120 to receive an additional euro per year in general pension provision, bringing the maximum to 420 euros per year. The term of the agreement is 36 months.

“This was far too late. Our colleagues have been fighting hard for a year,” as Silke Zimmer, a member of Verdi’s federal board responsible for trade, announced on Wednesday evening. “It is because of the courage and persistence of our colleagues that thousands of workers in Hamburg are once again under the protection of a legally binding collective agreement.” Until the Hamburg agreement, several warning strikes and high-level talks were unable to change the chaotic situation. Verdi entered the negotiations in all regions with a demand of at least 2.50 euros more per hour and a term of one year.