In 2015, the trade association Bitkom asked German companies with twenty or more employees about digitalization. Ninety-six percent said it was an opportunity for their own company. Fifty-six percent also said they were latecomers, and another 8 percent said they had fallen far behind. In a survey published in January 2020, Bitkom asked managing directors and board members again. Fifty-eight percent called their company a latecomer, and 3 percent said they had missed it altogether. Thirty-six percent saw themselves as pioneers.
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Three in Four Companies Still Fax
In 2024, 77 percent of German companies with twenty or more employees still used the fax machine, and a quarter used it often or very often. In 2018, the figure had been 95 percent. The trade association Bitkom asked them why. Fifty-six percent said they could not avoid it when dealing with government offices. Thirty-five percent named their established fax processes that work well, and 27 percent said habit. Bitkom commented that the change was happening erstaunlich langsam, surprisingly slowly. In November 2023, the budget committee of the Bundestag ordered all fax machines out of the parliament buildings by 30 June 2024. They are gone. The Bundestag still has a fax number for citizens, and incoming faxes are now digitized.
Industry 4.0
Industrie 4.0 is a German coinage. Henning Kagermann, Wolf-Dieter Lukas and Wolfgang Wahlster introduced it to the public at the Hannover Messe in 2011. Their article in VDI nachrichten was titled Mit dem Internet der Dinge auf dem Weg zur 4. industriellen Revolution (With the Internet of Things on the way to the fourth industrial revolution). On 14 April 2013, a working group chaired by Siegfried Dais of Bosch and Henning Kagermann of the National Academy of Science and Engineering presented its recommendations at the same fair. In 2015, Reinhard Clemens of T-Systems said the goals of the national Industry 4.0 platform had been missed, because concrete results and coordination were lacking. The computer scientist Wolfgang Halang called it sicher vermessen und unseriös, certainly presumptuous and not serious, to announce a fourth revolution before it had happened.
The Sector Agreement Stays the Standard
In Germany, the rules of a collective agreement apply directly and are binding. A deviation is allowed only if the agreement itself permits it, or if it favors the employee. On 12 February 2004, the union IG Metall and the employers of the metal and electrical industry signed the Pforzheim Agreement. It allows a plant to depart for a limited time from the agreed standards, such as working hours or holiday pay, in order to save or create jobs. The conditions are strict. Only the parties to the collective agreement can agree on the deviation. The employer must prove that it is necessary. The employees receive defined benefits in return, and they can sue for them. IG Metall sums it up: Der Flächentarifvertrag bleibt der Standard, die Abweichung die Ausnahme. (The sector-wide agreement remains the standard, and the deviation the exception.)
A Change Without Effect Until It Is Registered
When the shareholders of a German limited company, a GmbH, want to change its articles of association, the decision needs three quarters of the votes cast. A notary must record it. The change must then be filed with the commercial register. Until it is entered there, it has no legal effect: Die Abänderung hat keine rechtliche Wirkung, bevor sie in das Handelsregister des Sitzes der Gesellschaft eingetragen ist. (The amendment has no legal effect before it is entered in the commercial register at the company’s seat.)
Flexitime and Core Time
Gleitzeit, flexitime, is the most widespread form of flexible working hours in Germany. Employees must be present only during the Kernarbeitszeit, the core time. Before and after it, they choose, within certain limits, when to start and when to stop. Who invented it is disputed. English sources credit the management consultant Christel Kammerer. In Germany, the entrepreneur Wilhelm Haller, founder of the time-recording company Interflex, is called the Vater der Gleitzeit, the father of flexitime. He took up flexible working hours at the end of the 1960s and promoted the idea with the half-Swabian, half-English slogan Ai laik Gleitzeit.
Trust-Based Working Time
About one in five employees in Germany works under Vertrauensarbeitszeit, working time based on trust. What counts is that agreed tasks are done, not that the employee is present. The employee organizes his own hours and records them himself. The employer remains responsible for compliance with the legal limits on working time. On 14 May 2019, the European Court of Justice ruled that employers must record daily working time. The employers’ association Gesamtmetall called trust-based working time praktisch tot, practically dead. On 13 September 2022, the Federal Labor Court ruled that this duty applies to German employers unmittelbar und sofort, directly and immediately.
The Right to Direct
One sentence of the German Trade Regulation Act sets out how far a boss may give instructions. Der Arbeitgeber kann Inhalt, Ort und Zeit der Arbeitsleistung nach billigem Ermessen näher bestimmen, soweit diese Arbeitsbedingungen nicht durch den Arbeitsvertrag, Bestimmungen einer Betriebsvereinbarung, eines anwendbaren Tarifvertrages oder gesetzliche Vorschriften festgelegt sind. (The employer may specify the content, place and time of work in more detail at fair discretion, insofar as these conditions are not already fixed by the employment contract, a works agreement, an applicable collective agreement or statute.) The boss decides only in the space that the contract, works agreements, collective agreements and statutes leave open, and even there he must decide fairly.
When an Agreement Expires
A works agreement between employer and works council must be decided jointly, written down and signed by both sides. The employer must display it in a suitable place in the workplace. It applies directly and is binding. German labor law also says what happens when such an agreement ends. On matters where the conciliation board can decide if the two sides do not agree, its rules continue bis sie durch eine andere Abmachung ersetzt werden, until they are replaced by another agreement. A similar rule applies to collective wage agreements. When one expires, its rules continue to apply until they are replaced by another agreement.
Days to Get to Know Each Other
German labor courts recognize a phase that comes even before the probation. It is called the Einfühlungsverhältnis, literally a relationship for feeling one’s way in. A candidate spends a few days in the company before being hired, to get to know the work and the people. No employment relationship arises. There is no duty to work, no right to pay, and the employer may not give instructions. Several state labor courts have recognized it since 1989. Lawyers advise keeping it to a few days.