8 ms·

Deutschland AG rethinks workers’ role in management

48 points by c0restraint 7y ago

sunkenvicar 7y ago
Paywalled beyond the first two paragraphs.
- chrisseaton 7y ago
  Please don't complain about paywalls.
- dang 7y ago
  If there's a workaround, it's ok. Users usually post workarounds in the thread. This is in the FAQ at https://news.ycombinator.com/newsfaq.html https://news.ycombinator.com/newsfaq.html and there's more explanation here: https://news.ycombinator.com/item?id=10178989 https://news.ycombinator.com/item?id=10178989 https://hn.algolia.com/?sort=byDate&dateRange=all&type=comment&storyText=false&prefix&page=0&query=by:dang%20paywall https://hn.algolia.com/?sort=byDate&dateRange=all&type=comme...
deleted 7y ago
[deleted]
wongarsu 7y ago
Version without paywall: https://outline.com/SvtKVv https://outline.com/SvtKVv
arrrg 7y ago
Workers’ Councils often don’t exist because people don’t dare to form one. Despite pretty good rights for employees, it can still feel like painting a target on your back. I should have more forcefully driven for the creation of one in my small company. But it’s all too late now. The company was sold by the owner to a much larger US company and the day after that was announced, nearly a third of employees were fired. We are developing B2B SaaS and sold that in combination with professional services, with about a 50:50 split in revenue from those two parts. The company built its product without outside investments and has practically always been profitable in the past, with ok revenue growth, but we were seeing pressure from competitors who did have large investments. The US company didn’t want professional services (and also not anyone doing sales and marketing), they wanted the developers. A couple of weeks into this that seems absurd, especially since they seem to be expecting to keep most of the existing revenue which seems impossible since, you know, we had a 50:50 split in revenue and the people responsible for 50% of that (who had close working relationships with the clients) are no longer there. They are now flying people here but there is hardly anyone to teach them and … you know … usually it takes at least a couple of months to get people up to speed. Months in which our existing clients want to get work done! It’s so irrational. It’s also deeply immoral and unethical. Whether it be greed or a fundamental misunderstanding of how the product works or what do I know … that whole thing was surreal and weird and I kept thinking that one of the problems was that the person making the deal was fundamentally not understanding the business. Maybe a workers’ council could have helped or at least found a socially more responsible way. But when the acquisition was only a rumor I frequently mentioned to my colleagues that forming a council would be a good idea but never actually did it. Because, you know, who would want to paint a target on their back. But it is important for such institutions to exist. Employees inherently tend to have less power than employers and their work is not really optional. They can’t just decide to not do it and changing jobs or career or places where you live can be difficult to impossible. That’s why that isn’t just some kind of exachange of money for work. It has to be specifically and explicitly and strongly protected and workers should always have a say in the business because it concerns them. And their interests and the employers interests are not always aligned.
contingencies 7y ago
Does anyone have first hand experience with this system?
- Ididntdothis 7y ago
  Many German workers have experience with this system. I have had 3 years. It works pretty well in my view and creates some balance. It's probably not as much fun for management but that's Ok. It bugs me that in the US the only accepted stakeholders are the shareholders and nobody else counts.
  - anonsivalley652 7y ago
    Do you have any familiarity with IG Metall? If so, how helpful do you think are they, or were, for organized labor? Also, worker-owned co-ops seem the only way out of shareholder rent-seeking and narcissistic management behavior because just giving workers input without a fair share of profits is still similar to keeping slavery but adding a suggestions box.
    - Ididntdothis 7y ago
      I was IG Metall. As a young person it felt a little restrictive but now I feel it strikes a good balance. You make good money, no abusive workplace practices and the companies are also successful. Win-Win for everybody.
      - anonsivalley652 7y ago
        Those of us who are Americans sorely need to rediscover general strikes and practical labor unions that don't go crazy with organized crime or utopian politics. Oklahoma was a socialist bastion, Henry A. Wallace got the DNC Bernie Sanders-treatment, strikers of the 19th century were summarily executed by Pinkerton and hired snipers like it was a prison riot, and decades of strikes/strike breaking and unionization helped usher in a brief post-WW2 era of prosperity. Now, poor and white-collar Americans argue unthinkingly and constantly for austerity, mindless deregulation and giving more money to only the rich (because of manufactured consent). I don't see how there's anything but misery, fear of major disease and destitution for 75-90% of Americans; and there aren't many good jobs for average workers because there's almost no manufacturing ecosystem like there is in China.
paulhart 7y ago
“Only [...] SAP, a software-maker, is among the world’s 100 biggest companies. Apple’s $1.4trn market value is roughly that of the entire DAX 30.” Is this actually a problem though? The model seems to have provided some insulation from global turmoil in the past; is having enormous corporations the only important thing for a country’s economy? For as long as it doesn’t fall foul of EU laws, I can see Germans wanting to maintain this strategic advantage that other nations ignore while they’re busy chasing down every last short-term dollar.
- Ididntdothis 7y ago
  I think these huge companies are not good for the economy, the country or innovation. They are too powerful and they have the ability to suppress competition by just buying it up.
- akira2501 7y ago
  Their GDP per capita is about 17% lower than the United States, but their GDP per hour worked is only 3% lower with their average work-week being 22% shorter than in the United States. So, from a very narrow and short-sighted point of view.. they're just as productive as we are, but they have 1/3 our population and they work fewer hours which limits their ability to compete in the global marketplace. For German companies that serve only domestically or within the EU, I doubt the councils are a problem or even an impediment.. but for companies that want to operate globally, I imagine it does reduce their ability to compete. I guess the question for Germany is, do they want to sacrifice these broader protections and slightly better working conditions in order to improve profits for a handful of companies that can actually take advantage of it? I hope not, but it looks like the groundwork is already being laid for a campaign to change this.
  - kamarg 7y ago
    I wonder if the question is really, do the giant corporations that want to compete globally have as much ability to get laws passed in Germany as they do here in the US? If they do, you can bet that those protections and working conditions will start looking a lot more like what we see in the US even if it's only a benefit for a fraction of a percentage of people in Germany and a detriment for all the rest.
twright 7y ago
A more accurate title seems to be “Management rethinks workers’ role in management.” Are there complaints about co-determination from workers themselves (I’d be more interested to hear those)? Or is this management complaining they can’t mistreat workers in the name of corporate profit?
- fxtentacle 7y ago
  It's the latter and the article even concedes that mistreating workers won't help much, either. "European countries which do not embrace it hardly do better."
fxtentacle 7y ago
Sounds like propaganda to me. I'm German and my impression is that almost everyone is happy with the current model where you have a legally guaranteed right of holding CEOs accountable. Everyone, except the American hedge funds trying to squeeze out more profits by increasing working hours, that is. So to me, this article reads like "let's make Germany more like America in that the rich rule the poor". And I find it rather surprising that they went with "Deutschland AG" because treating Germany like a country is usually only done by a rather weird tiny subset of citizens who refuse to adhere to laws and instead revel in conspiracy theories about foreign overloads secretly deciding what everyone has to do. But most weirdly I find that I haven't heard this set of laws being discussed critically in German at all, but that instead an English article with odd word choice should be the first to criticise it.
- hef19898 7y ago
  Yeah, the Deutschland AG where all companies were in one way or the other intervened with each other with Deutsche Bank in the middle is long gone. At least since the 90s.
  - C14L 7y ago
    Early 2000s. One of the Schroeder reforms.
    - hef19898 7y ago
      Agenda 2020 was the final stroke, but one could argue it started with the reunion already.
- Doctor_Fegg 7y ago
  “UK plc” is common parlance here. I’m guessing the (British) Economist is awkwardly trying to use the same idiom.
- germanier 7y ago
  "Deutschland AG" was commonly used in political discussion up until the early 2000s, it even made it into Wikipedia https://de.wikipedia.org/wiki/Deutschland_AG https://de.wikipedia.org/wiki/Deutschland_AG and other encyclopedias. It has nothing to do with the Reichsbürger movement
gyulai 7y ago
...the problem is that "worker codetermination" is not really about owners and workers pulling on the same string, but rather worker representatives often have a ridiculously narrow-minded focus on workers' interests while completely disregarding what is and isn't economical for a company to do. To give you one example: I used to work for one of Germany's biggest telcos. Believe it or not: That company is unable to do geographically-targeted advertising for reasons of worker codetermination. Worker reps in the company's supervisory board argue that, since some employees get part of their compensation through sales commissions, targeting advertising to region X gives employees in region X an unfair advantage to earn more money than employees in other regions. Working for the same company, I was involved in a project to do natural language processing in a ticket system the company was using to track repair and maintenance work of radio units, with the goal of building a model to recognize tickets that were in increased need of attention by higher-level management. Even though it wasn't initially the project's goal to do so, the thing that the model ultimately picked up on was basically indications of employees being lazy as they handle those tickets. -- But the data I was given was anonymized. It was argued that if it weren't anonymized, my project would have never been approved by worker representatives in the supervisory board for reasons of violating workers' right to "data protection".
- necrobrit 7y ago
  Interesting. This is a pretty common criticism of unions in the anglosphere as well -- often alongside a note that the problem has been "solved" in Germany via worker codetermination. Have you found this situation to be universal in Germany or only at some employers? This is one of those things I'd actually expect "the market" to be good at regulating. Bad union or management kills a company, company with better management or union fills the market void etc...
  - gyulai 7y ago
    This was the only company with worker codetermination that I've ever worked at, so I don't have anything to compare it to. Part of the reason is that, as the article says, companies will try at all costs to avoid it when there is legally a way it can be avoided, and I'm guessing that this in and of itself speaks to the fact that there's a problem there. Otherwise you might expect companies to volunteer into it for reasons of improving their employer brand and so forth. But the opposite is the case, with many large companies going as far as incorporating in other European jurisdictions and using European freedom-of-movement rules for legal entities to operate out of Germany. N.b.: This confers no tax advantages. It is done solely for the purposes of escaping Germany's companies' law. (Examples: The German department store "Müller" with over 700 retail locations in Germany and "Air Berlin", a major airline out of Germany, were incorporated in Britain).
fxj 7y ago
This is the situation in europe at the moment: As far as the rules on employee participation are concerned, three groups of countries can be distinguished in the 28 EU countries and Norway. In the first group, consisting of ten countries, there is no employee participation. In the five countries in the second group, employee participation is limited to state-owned or recently privatised companies. But the largest group is made up of 14 countries that provide for employee representation on the boards of private sector companies above a certain size. There are large differences in the minimum numbers of employees and other aspects of the procedures for employee involvement at national level. http://de.worker-participation.eu/Nationale-Arbeitsbeziehungen/Quer-durch-Europa http://de.worker-participation.eu/Nationale-Arbeitsbeziehung...

48 points by c0restraint 7y ago

sunkenvicar 7y ago

Paywalled beyond the first two paragraphs.

chrisseaton 7y ago
Please don't complain about paywalls.
dang 7y ago
If there's a workaround, it's ok. Users usually post workarounds in the thread. This is in the FAQ at https://news.ycombinator.com/newsfaq.html https://news.ycombinator.com/newsfaq.html and there's more explanation here: https://news.ycombinator.com/item?id=10178989 https://news.ycombinator.com/item?id=10178989 https://hn.algolia.com/?sort=byDate&dateRange=all&type=comment&storyText=false&prefix&page=0&query=by:dang%20paywall https://hn.algolia.com/?sort=byDate&dateRange=all&type=comme...

deleted 7y ago

[deleted]

wongarsu 7y ago

Version without paywall: https://outline.com/SvtKVv https://outline.com/SvtKVv

arrrg 7y ago

Workers’ Councils often don’t exist because people don’t dare to form one. Despite pretty good rights for employees, it can still feel like painting a target on your back. I should have more forcefully driven for the creation of one in my small company. But it’s all too late now. The company was sold by the owner to a much larger US company and the day after that was announced, nearly a third of employees were fired. We are developing B2B SaaS and sold that in combination with professional services, with about a 50:50 split in revenue from those two parts. The company built its product without outside investments and has practically always been profitable in the past, with ok revenue growth, but we were seeing pressure from competitors who did have large investments. The US company didn’t want professional services (and also not anyone doing sales and marketing), they wanted the developers. A couple of weeks into this that seems absurd, especially since they seem to be expecting to keep most of the existing revenue which seems impossible since, you know, we had a 50:50 split in revenue and the people responsible for 50% of that (who had close working relationships with the clients) are no longer there. They are now flying people here but there is hardly anyone to teach them and … you know … usually it takes at least a couple of months to get people up to speed. Months in which our existing clients want to get work done! It’s so irrational. It’s also deeply immoral and unethical. Whether it be greed or a fundamental misunderstanding of how the product works or what do I know … that whole thing was surreal and weird and I kept thinking that one of the problems was that the person making the deal was fundamentally not understanding the business. Maybe a workers’ council could have helped or at least found a socially more responsible way. But when the acquisition was only a rumor I frequently mentioned to my colleagues that forming a council would be a good idea but never actually did it. Because, you know, who would want to paint a target on their back. But it is important for such institutions to exist. Employees inherently tend to have less power than employers and their work is not really optional. They can’t just decide to not do it and changing jobs or career or places where you live can be difficult to impossible. That’s why that isn’t just some kind of exachange of money for work. It has to be specifically and explicitly and strongly protected and workers should always have a say in the business because it concerns them. And their interests and the employers interests are not always aligned.

contingencies 7y ago

Does anyone have first hand experience with this system?

Ididntdothis 7y ago
Many German workers have experience with this system. I have had 3 years. It works pretty well in my view and creates some balance. It's probably not as much fun for management but that's Ok. It bugs me that in the US the only accepted stakeholders are the shareholders and nobody else counts.
- anonsivalley652 7y ago
  Do you have any familiarity with IG Metall? If so, how helpful do you think are they, or were, for organized labor? Also, worker-owned co-ops seem the only way out of shareholder rent-seeking and narcissistic management behavior because just giving workers input without a fair share of profits is still similar to keeping slavery but adding a suggestions box.
  - Ididntdothis 7y ago
    I was IG Metall. As a young person it felt a little restrictive but now I feel it strikes a good balance. You make good money, no abusive workplace practices and the companies are also successful. Win-Win for everybody.
    - anonsivalley652 7y ago
      Those of us who are Americans sorely need to rediscover general strikes and practical labor unions that don't go crazy with organized crime or utopian politics. Oklahoma was a socialist bastion, Henry A. Wallace got the DNC Bernie Sanders-treatment, strikers of the 19th century were summarily executed by Pinkerton and hired snipers like it was a prison riot, and decades of strikes/strike breaking and unionization helped usher in a brief post-WW2 era of prosperity. Now, poor and white-collar Americans argue unthinkingly and constantly for austerity, mindless deregulation and giving more money to only the rich (because of manufactured consent). I don't see how there's anything but misery, fear of major disease and destitution for 75-90% of Americans; and there aren't many good jobs for average workers because there's almost no manufacturing ecosystem like there is in China.

paulhart 7y ago

“Only [...] SAP, a software-maker, is among the world’s 100 biggest companies. Apple’s $1.4trn market value is roughly that of the entire DAX 30.” Is this actually a problem though? The model seems to have provided some insulation from global turmoil in the past; is having enormous corporations the only important thing for a country’s economy? For as long as it doesn’t fall foul of EU laws, I can see Germans wanting to maintain this strategic advantage that other nations ignore while they’re busy chasing down every last short-term dollar.

Ididntdothis 7y ago
I think these huge companies are not good for the economy, the country or innovation. They are too powerful and they have the ability to suppress competition by just buying it up.
akira2501 7y ago
Their GDP per capita is about 17% lower than the United States, but their GDP per hour worked is only 3% lower with their average work-week being 22% shorter than in the United States. So, from a very narrow and short-sighted point of view.. they're just as productive as we are, but they have 1/3 our population and they work fewer hours which limits their ability to compete in the global marketplace. For German companies that serve only domestically or within the EU, I doubt the councils are a problem or even an impediment.. but for companies that want to operate globally, I imagine it does reduce their ability to compete. I guess the question for Germany is, do they want to sacrifice these broader protections and slightly better working conditions in order to improve profits for a handful of companies that can actually take advantage of it? I hope not, but it looks like the groundwork is already being laid for a campaign to change this.
- kamarg 7y ago
  I wonder if the question is really, do the giant corporations that want to compete globally have as much ability to get laws passed in Germany as they do here in the US? If they do, you can bet that those protections and working conditions will start looking a lot more like what we see in the US even if it's only a benefit for a fraction of a percentage of people in Germany and a detriment for all the rest.

twright 7y ago

A more accurate title seems to be “Management rethinks workers’ role in management.” Are there complaints about co-determination from workers themselves (I’d be more interested to hear those)? Or is this management complaining they can’t mistreat workers in the name of corporate profit?

fxtentacle 7y ago
It's the latter and the article even concedes that mistreating workers won't help much, either. "European countries which do not embrace it hardly do better."

fxtentacle 7y ago

Sounds like propaganda to me. I'm German and my impression is that almost everyone is happy with the current model where you have a legally guaranteed right of holding CEOs accountable. Everyone, except the American hedge funds trying to squeeze out more profits by increasing working hours, that is. So to me, this article reads like "let's make Germany more like America in that the rich rule the poor". And I find it rather surprising that they went with "Deutschland AG" because treating Germany like a country is usually only done by a rather weird tiny subset of citizens who refuse to adhere to laws and instead revel in conspiracy theories about foreign overloads secretly deciding what everyone has to do. But most weirdly I find that I haven't heard this set of laws being discussed critically in German at all, but that instead an English article with odd word choice should be the first to criticise it.

hef19898 7y ago
Yeah, the Deutschland AG where all companies were in one way or the other intervened with each other with Deutsche Bank in the middle is long gone. At least since the 90s.
- C14L 7y ago
  Early 2000s. One of the Schroeder reforms.
  - hef19898 7y ago
    Agenda 2020 was the final stroke, but one could argue it started with the reunion already.
Doctor_Fegg 7y ago
“UK plc” is common parlance here. I’m guessing the (British) Economist is awkwardly trying to use the same idiom.
germanier 7y ago
"Deutschland AG" was commonly used in political discussion up until the early 2000s, it even made it into Wikipedia https://de.wikipedia.org/wiki/Deutschland_AG https://de.wikipedia.org/wiki/Deutschland_AG and other encyclopedias. It has nothing to do with the Reichsbürger movement

gyulai 7y ago

...the problem is that "worker codetermination" is not really about owners and workers pulling on the same string, but rather worker representatives often have a ridiculously narrow-minded focus on workers' interests while completely disregarding what is and isn't economical for a company to do. To give you one example: I used to work for one of Germany's biggest telcos. Believe it or not: That company is unable to do geographically-targeted advertising for reasons of worker codetermination. Worker reps in the company's supervisory board argue that, since some employees get part of their compensation through sales commissions, targeting advertising to region X gives employees in region X an unfair advantage to earn more money than employees in other regions. Working for the same company, I was involved in a project to do natural language processing in a ticket system the company was using to track repair and maintenance work of radio units, with the goal of building a model to recognize tickets that were in increased need of attention by higher-level management. Even though it wasn't initially the project's goal to do so, the thing that the model ultimately picked up on was basically indications of employees being lazy as they handle those tickets. -- But the data I was given was anonymized. It was argued that if it weren't anonymized, my project would have never been approved by worker representatives in the supervisory board for reasons of violating workers' right to "data protection".

necrobrit 7y ago
Interesting. This is a pretty common criticism of unions in the anglosphere as well -- often alongside a note that the problem has been "solved" in Germany via worker codetermination. Have you found this situation to be universal in Germany or only at some employers? This is one of those things I'd actually expect "the market" to be good at regulating. Bad union or management kills a company, company with better management or union fills the market void etc...
- gyulai 7y ago
  This was the only company with worker codetermination that I've ever worked at, so I don't have anything to compare it to. Part of the reason is that, as the article says, companies will try at all costs to avoid it when there is legally a way it can be avoided, and I'm guessing that this in and of itself speaks to the fact that there's a problem there. Otherwise you might expect companies to volunteer into it for reasons of improving their employer brand and so forth. But the opposite is the case, with many large companies going as far as incorporating in other European jurisdictions and using European freedom-of-movement rules for legal entities to operate out of Germany. N.b.: This confers no tax advantages. It is done solely for the purposes of escaping Germany's companies' law. (Examples: The German department store "Müller" with over 700 retail locations in Germany and "Air Berlin", a major airline out of Germany, were incorporated in Britain).

fxj 7y ago

This is the situation in europe at the moment: As far as the rules on employee participation are concerned, three groups of countries can be distinguished in the 28 EU countries and Norway. In the first group, consisting of ten countries, there is no employee participation. In the five countries in the second group, employee participation is limited to state-owned or recently privatised companies. But the largest group is made up of 14 countries that provide for employee representation on the boards of private sector companies above a certain size. There are large differences in the minimum numbers of employees and other aspects of the procedures for employee involvement at national level. http://de.worker-participation.eu/Nationale-Arbeitsbeziehungen/Quer-durch-Europa http://de.worker-participation.eu/Nationale-Arbeitsbeziehung...