Germany, Processes, Power - understand-culture

Lidl Chose a System of Its Own

In July 2018 the discount chain Lidl stopped eLWIS, its project to run its merchandise management on SAP software, after seven years. According to the trade paper Lebensmittel Zeitung, citing industry observers, the project is said to have cost 500 million euros. Lidl did not comment on the costs.

Lidl put the decision in one sentence. It was keine Entscheidung gegen SAP, sondern für ein eigenes System, not a decision against SAP, but for a system of its own. Lidl went on developing its existing in-house system.

English-language reports, citing the business daily Handelsblatt, give one reason. Lidl kept its stock records on purchase prices, while SAP’s standard retail software works with sales prices, and Lidl did not change its method. The Handelsblatt article itself could not be checked.

Judged Only by the Work

Under Section 94 of the Works Constitution Act, an employer who wants to set general principles for appraising staff needs the consent of the works council. If the two sides cannot agree, an arbitration board decides.

In 2014 the Federal Labor Court explained the purpose of the rule. Such principles are meant to make the assessment of conduct or performance objective or uniform. The co-determination right is to ensure that an employee is judged nur nach seiner Arbeitsleistung, only by his work performance, and by his personal suitability for development in the company. The case concerned staff appraisals at a rehabilitation clinic.

Containment First, Then the Permanent Fix

In its rules for 8D reports, Hella, a German supplier of lighting and electronics for cars, sets out how its own suppliers must answer a complaint about a defective part. The 8D report first asks for Sofortmaßnahmen, immediate measures. These apply to the part under complaint, they are temporary, and the supplier must check their effectiveness constantly. Corrective measures come next.

They must ensure that a defect does not occur a second time, and the long-term measures should stop the problem permanently and reliably. A final check confirms that the measures were carried out for good. The German verb in Hella’s rule is abstellen, to remove a defect, and here it must be removed dauerhaft und verlässlich, permanently and reliably.

Home Office Rules Need the Works Council

Since 18 June 2021 the German Works Constitution Act has listed a new matter on which the works council has a right of co-determination: the Ausgestaltung von mobiler Arbeit, the arrangement of mobile work. Lawyers point out that whether a company offers mobile work at all remains the employer’s decision. How it works must be agreed with the works council.

This covers how much mobile work is possible, when the working day starts and ends, and from which places employees may work. If the two sides cannot agree, a conciliation board decides. Its ruling replaces their agreement.

Training Rules Made by Consensus

When Germany creates or modernizes a training occupation, the new rules are drafted by experts from practice. The employers’ organizations and the unions nominate them. A procedure starts only when the employers and the unions of the industry agree. Without major disagreements it takes about two years. The employers’ federation BDA sums it up: Ordnungsarbeit ist Konsensarbeit – und zwar auf allen Ebenen.

(Regulation work is consensus work, at every level.) The Federal Institute for Vocational Education and Training writes that this consensus principle has proven itself over decades. Once the regulation is issued, it binds every company in the country. The Vocational Training Act says: Für einen anerkannten Ausbildungsberuf darf nur nach der Ausbildungsordnung ausgebildet werden. (For a recognized training occupation, training may follow only the training regulation.)

No Roster Without the Works Council

Under Section 87 of the Works Constitution Act, the works council has a say over the start and end of daily working hours, including breaks. It also has a say over how working time is spread across the days of the week. A hospital in Mecklenburg-Western Pomerania sent the nurses’ rosters to its works council about a month in advance.

It treated silence by the 10th of the month as consent. On 10 November 2015, the state labor court of appeal ruled that this was not enough. The works council must agree expressly. The employer may not set it a deadline or treat its silence as consent. Without agreement, the conciliation board decides.

A Procedure for Better Ideas

In many German companies, an employee with a better way of working can submit it to the betriebliches Vorschlagswesen, the company suggestion scheme. Experts assess the idea, and a committee decides on it and on the bonus.

The works council has a legal right of co-determination over the principles of the scheme, under § 87 of the Works Constitution Act. A study for the Hans Böckler Foundation dates the first such scheme to 1871, at the Krupp company.

In Good Time and in Full

In a German company with more than twenty employees entitled to vote, management must inform the works council rechtzeitig und umfassend, in good time and in full, about any planned change in operations that could bring significant disadvantages for the staff. It must then discuss the plan with the works council. The law lists what counts as such a change.

It includes closures and relocations, and also the Einführung grundlegend neuer Arbeitsmethoden und Fertigungsverfahren, the introduction of fundamentally new working methods and production processes. Management must try to reach an agreement on how the change will be carried out. If it carries out the change without having tried, employees who lose their jobs can sue for compensation. A change of method that skips the negotiation can cost money for each person affected.

While the Plan Can Still Change

German labor law defines good time by its purpose. When an employer plans new technical systems, new work processes or new workplaces, it must inform the works council, and the law names the Einsatz von Künstlicher Intelligenz, the use of artificial intelligence, explicitly.

It must consult the works council so rechtzeitig …, dass Vorschläge und Bedenken des Betriebsrats bei der Planung berücksichtigt werden können, early enough that the works council’s proposals and concerns can still be taken into account in the planning. The same law asks employer and works council to meet at least once a month. They must negotiate disputed questions mit dem ernsten Willen zur Einigung, with the serious will to reach agreement.

Who writes, remains

Wer schreibt, der bleibt — who writes, remains. A German saying about the authority of the written record, used in meetings about who is taking the minutes.

Papier ist geduldig — paper is patient, the counter-saying, warning that writing something down does not make it true.

Das steht so im Prozess — that is how it stands in the process. Offered in German discussion as a reason, and usually accepted as one.