White Paper W O R K 4.0

RE-IMAGINING WORK WHITE PAPER W O R K 4.0

FEDERAL MINISTRY OF LABOUR AND SOCIAL AFFAIRS

CONTENTS

FOREWORD BY FEDERAL MINISTER ANDREA NAHLES ...... 4

SUMMARY OF RESULTS ...... 8

KEY ...... 15

1. DRIVERS AND TRENDS ...... 18 1.1 Digitalisation ...... 19 1.2 Globalisation...... 25 1.3 Demography and the future labour supply ...... 29 1.4 Cultural change ...... 32

2. CHALLENGES PRESENTED BY WORK 4.0...... 42 2.1 Employment effects: transformation of sectors and activities...... 44 2.2 Digital platforms: new markets and new forms of work ...... 55 2.3 Big Data: the raw material of the digital economy ...... 62 2.4 Industry 4.0 and the human-machine interaction ...... 67 2.5 Flexible working time and location: beyond presenteeism ...... 73 2.6 Companies: organisational structures in transformation ...... 82

3. A VISION FOR QUALITY JOBS IN THE DIGITAL AGE ...... 92

4. POLICY OPTIONS ...... 98 4.1 Employability: from unemployment to employment insurance ...... 100 4.2 Working time: flexible, but self-determined ...... 115 4.3 The service sector: fostering good working conditions...... 128 4.4 Health at work: approaches for Occupational Safety and Health 4.0 ...... 135 4.5 Employee data protection: safeguarding high standards ...... 142 4.6 Co-determination and participation: transformation based on social partnership ...... 152 4.7 Self-employment: fostering freedom and social protection ...... 166 4.8 The welfare state: future prospects and European dialogue ...... 177

5. RE-IMAGINING WORK: IDENTIFYING TRENDS, TESTING INNOVATIONS, STRENGTHENING SOCIAL PARTNERSHIP...... 188

ANNEX ...... 196 Glossary ...... 198 Bibliography ...... 204 Responses to the Green Paper on Work 4.0 ...... 214 The consultation process ...... 216 Advisory group ...... 222 Expert dialogue...... 224 Workshops ...... 225 Futurale – A film festival on the future of work ...... 230 Imprint ...... 232 Foreword

We wrote a Green Paper setting out questions. It is now fitting that we publish a White Paper offering answers. This document summarises the conclusions we have drawn from the public dialogue. Through it, we want to capture and define a broader public debate and provide impetus, within the Federal Government and beyond, for society to shape the future of work.

FOREWORD BY The vital significance of the digital transformation for our country is also reflected in the Federal Government’s Digital Agenda and its prior- FEDERAL MINISTER ities for action. The Federal Ministries are engaging with this issue through various initiatives and platforms. Broadband roll-out and inter- ANDREA NAHLES net access, data security and the implementation of new manufacturing concepts – defined as “Industry¥4.0” – are vital for our position as a location for business. This is the context for the Work¥4.0 dialogue. An eight-hour working day and an at least 36 hours of uninterrupted reast per week; better hygiene and safety measures in factories; and an It is already clear that the digital transformation – especially in relation end to child labour – once, that was our vision of the future of work. to the world of work – polarises opinion. For some it offers excitement Today there are new visions of how we would like to work: the creative and the prospect of greater personal freedom, for others it bodes uncer- knowledge worker, for example, sitting by a lake with his laptop. Or the tainty. After many discussions, my personal conclusion is: we want to manufacturing worker who uses an app to choose her preferred shifts seize the opportunities which digitalisation offers for our economy, for for the coming week. the labour market, and quality jobs. In doing so, we must take concerns about job losses, the erosion of skills, work intensification and the The future world of work will be different from today’s. Will it also breakdown of the boundaries between work and private life seriously; as be better? Will we work in a more self-determined and healthy way? well as taking into account the divide between people who find prom- Will we go back to university or learn a new occupation at the age of ise in freedom and flexibility and those who seek stability and security. 50? Are machines taking away our jobs, or are they paving the way for At the same time, we must highlight where the opportunities lie, and innovations and productivity gains which create new ones? show that we have the power to shape the direction of change.

We raised these questions and many more in a Green Paper on what If this White Paper were a novel, digitalisation might well be its secret we called “Work¥4.0”, and have since discussed them as part of a broad main character, never far from the action and significantly influencing public dialogue: with experts from the social partners, associations, how events unfold. But it is not the sole protagonist, and the White Paper businesses and academia, and with members of the public. I would like has more than a single theme. Instead, Work¥4.0 stands for the changes to warmly thank all those who have taken part and whose contributions taking place in the whole of the working world and their implications for have set us on a new path. society. Rather than describing the normal status quo today, Work¥4.0 is about future perspectives, scenarios and opportunities – to shape work in a way which benefits people and advances our economy.

4 5 Foreword

What are our aims? A fair compromise between employers’ flexibility requirements and workers’ needs. A campaign to promote lifelong learning and every worker’s right to continuing vocational education and training, because jobs are changing to an unprecedented extent. Participation in the labour market and fair wages. More choice around working hours and an innovative approach to working time which recognises the personal, family and societal demands on people, alongside the demands of work, and which supports new solutions in balancing these demands. Technology which lightens people’s workloads. Guar- anteed statutory protection for all workers and new ways of supporting healthy work. Data protection rules which ensure that employee data protection standards aren’t violated, even in the future. Co-determination and involvement in the workplace and through social partners. Better social protection for self-employed individuals and fair working conditions in the platform economy. A welfare state which takes the diversity of people’s life plans and the need to offer protection against upheavals seriously, and which takes a forward-looking approach rather than reacting to disruptive changes after the event.

The Work¥4.0 dialogue has made clear that we need to embark on new paths in order to launch and drive forward negotiations at all levels to shape the way we work. I firmly believe that our model of co-determination and social partnership offers the best foundation for Germa- ny to become a pioneer in shaping decent work in the digital age. Our efforts in shaping the future world of work will continue. They are worthwhile.

6 Summary

SUMMARY OF RESULTS important, how can employees’ legitimate entitlement to data protection be guaranteed? Fourth: if humans and machines work together ever more closely in future, how can machines help to support and empower This White Paper on what we have called “Work¥4.0” is the culmination people in the way they work? Fifth: the world of work is becoming more of a consultation process launched in April 2015 with the publication of a flexible. But what might solutions look like which also improve options Green Paper by the Federal Ministry of Labour and Social Affairs. for workers, in terms of when and where they do their work? Sixth: “Work¥4.0” is a necessary extension of the debate about the digitalisa- what will the modern company of the future look like – one which may tion of the economy, generally referred to as “Industry¥4.0”. The Federal no longer resemble a traditional company in all respects, but which Ministry of Labour and Social Affairs invited associations, trade unions nonetheless facilitates participation and social security for its employees? and businesses to submit responses, held numerous specialised workshops and events, commissioned academic studies, and formed an impres- Chapter¥3 outlines our vision of decent work and quality jobs within sion of public opinion based on a direct dialogue with the public at local the digital transformation, and forms the normative basis for the con- level – for example during the “Futurale” film festival. The overarching clusions and policy options of Chapter¥4. The vision draws on the question was: how can we preserve or even strengthen our vision of strengths of the German economic and social model and argues for a quality jobs and decent work (Gute Arbeit) in an era of digital transfor- socially balanced future world of work which offers both, security and mation and societal change? flexibility. Fair wages and social protection remain the fundamental criteria for quality jobs, and offering all citizens the opportunity to par- The Green Paper raised specific questions. This White Paper offers ticipate in the labour market under favourable conditions continues to initial answers. be a key policy objective. At the same time, it is important to recognise the growing diversity in workers’ preferences regarding working life, Chapter¥1 sets out the major trends and key drivers in the current which entails giving people more autonomy over the whay they struc- transformation of the world of work: digitalisation, globalisation, ture their lives. To this end, we need to make the most of the potential demographic change, education, migration, and the transformation of offered by technological change for shaping and organising work in a people’s values and preferences. These are the forces driving change. better way. Institutional co-determination (Mitbestimmung) and new Even so, the exact shape which developments take and their scope are forms of individual participation for workers should be regarded not as in no way predetermined. contradictory, but as complementary, hallmarks of innovative and democratic businesses, within an innovative and democratic society. Chapter¥2 takes a closer look at key challenges and tensions character- ising the World¥of Work 4.0, where new needs for action are emerging Chapter¥4 identifies key areas of activity and sets out potential policy for businesses, workers, social partners, trade associations, policy-makers solutions. The technological and economic transformation we are ex- at federal and state level, as well as other stakeholders. The subchapters periencing will not entail a wholesale automation of jobs. However, oc- take an analytical approach – they describe changes taking place in the cupations and activities will likely be transformed, and employment world of work and explore the associated opportunities and risks. The will shift substantially between sectors. In the light of such upheavals, it focus is on six key questions which were raised in the consultation process is essential to invest in boosting skills and improving individual pros- and outline main areas of tension between technological and economic pects for advancement at an early stage. This support must be focused on progress, on the one hand, and working conditions, on the other. First: prevention: it should not only target low-skilled workers; take effect will digitalisation enable everyone, as far as possible, to have a job in late in a person’s working life, or immediately prior to redundancy, but future? And, if so, subject to what conditions? Second: what will be the follow a broader approach. Under this logic, the current unemployment impact of new business models such as “digital platforms” on the work of insurance should be gradually transformed into an employment insur- the future? Third: if the collection and use of data is becoming ever more ance, to allow more preventive support for workers. An important ele-

8 9 Summary Summary

ment would be the right to independent advice on lifelong education, of a household services account and its digital administration could be training and up-skilling. Looking to the future, one of our aspirations is a suitable approach to support households (ª¥Chapter¥4.3). the introduction of a legal right to continuing vocational education and training (ª¥Chapter¥4.1). Health and safety at work must be adapted not only in the light of the digital transformation, but also of increasingly perceptible demo- Digitalisation offers the opportunity for greater self-determination in graphic changes. To this end, it will be necessary to focus more on the the world of work. However, a balance must be struck between conflict- psychological strains of work, alongside physical demands. The Federal ing interests and goals. Legally binding protection against overwork Ministry of Labour and Social Affairs will therefore seek to further develop and against the undue intrusion of work into a person’s private life is health and safety instruments into an Occupational Safety and Health essential. People increasingly express a need for more control over Strategy 4.0 (ª¥Chapter¥4.4). when and where they work. The current coalition agreement contains an initiative to anchor a general right to temporary part-time work in the Employee data protection requires a comprehensive approach. This is Act on Part-Time and Fixed-Term Employment (Teilzeit- und Befris- both a result of continuing technological developments and the growing tungsgesetz), this would make an important contribution to meeting importance of digital applications in the world of work; and of the new workers’ demands for greater autonomy. Negotiated working time European legal framework, the European General Data Protection Regu- models and «exibility compromises are becoming more and more impor- lation due to enter into force in 2018. The Federal Ministry of Labour and tant, recognising that the organisation of working time forms a central Social Affairs will seek to ensure that the crucial provision on employee plank of effective human resources strategies, performance appraisal data protection (Section¥32 of the Federal Data Protection Act (Bun- criteria, and management cultures. desdatenschutzgesetz)), which regulates “Data collection, processing and use for employment-related purposes”, is retained. As a second A specific, more far-reaching approach would be a Working Time step, the leeway for more specific provisions which the European Choice Act (Wahlarbeitszeitgesetz), which would combine greater General Data Protection Regulation grants to national legislators choice for workers in relation to working time and location with a condi- should be put to use. To monitor and support further developments, tional possibility to derogate from certain provisions of the Working Time the Federal Ministry of Labour and Social Affairs will establish an inter- Act (Arbeitszeitgesetz) on the basis of a collective agreement between disciplinary advisory council and promote the development of an Em- the social partners and an implementation at firm-level. This should in- ployee Data Protection Index, through which quality standards will be itially be limited to a two-year period and trialled through pilots with- set in a scientifically-informed process (ª¥Chapter¥4.5). in workplaces (ª¥Chapter¥4.2). Social partnership, co-determination and democratic participation in It is important to recognise that digitalisation goes beyond Indus- shaping working conditions are core elements of Germany’s social mar- try¥4.0, and strongly impacts on the service and trade sectors in par- ket economy, a stabilising force in times of crisis, and a factor for suc- ticular. This applies not only to the nature of work itself, but also to the cess in the face of international competition. To successfully cope fact that platforms are increasingly acting as intermediaries, with pro- with digital structural change, the negotiation processes between the found effects on markets and employment conditions. Especially in the social partners and at firm-level need to be strengthened. In particular, services and care sectors, collective bargaining coverage should be in- this requires a stabilisation of collective bargaining structures in Germany, creased and, looking to the future, eventually lead to a generally binding a broader foundation for workers’ involvement in their organisations, collective agreement for the social sector. The importance of the care adequate rights and resources for works and staff councils, and the sector will continue to grow. Attractive working conditions are particu- safeguarding of national and European standards for corporate co-deter- larly necessary in this area. Public co-financing is sensible in the case of mination. The Federal Ministry of Labour and Social Affairs will therefore socially necessary services delivered by the private sector. A new model continue to propose greater flexibility in applying the general legislative

10 11 Summary Summary

frameworks contingent on the existence of collective agreements. It will The debate on the Work 4.0 will continue. New trends must be rec- take steps to promote the establishment of works councils, and it will ognised, and some options need testing in order to determine their present proposals for boosting the ability of works councils to engage effects in practice. Chapter¥5 sketches a way forward in our efforts to in effective and efficient co-determination in the digital world of work. “re-imagine work”.

This wll also work in the interests of employers, who rightly have a We need better data to observe and foresee how our world of work need for greater flexibility in the light of rapid market changes will develop over the coming years. The Federal Ministry of Labour and (ª¥Chapter¥4.6). Social Affairs is therefore proposing to introduce a regular public reporting on the world of work, with the involvement of academia and the Creating a conducive environment for self-employment and start-ups social partners representing employers and workers. in Germany is an important economic policy priority, and effective labour- market and social policies are key enablers in this. The lines between To achieve new flexibility compromises, we should examine further employment and self-employed work are blurring; this will be even incentives and instruments to support social partnership, collective truer in the digital world of work. Against this background, it is appro- bargaining coverage and the establishment of works councils. Rather priate and reasonable to include self-employed individuals in the statu- than simply seeking to slow the erosion of collective bargaining coverage tory pension insurance system alongside employees. The associated and staff representation which has been evident over recent decades, contributions must be assessed together with costs incurred in other we should endeavour to reverse this trend. We want a phase of “shared social insurance systems, in particular statutory health insurance. Beyond learning in and from the transformation” and an experimental testing provisions for old age, one-size-fits-all solutions will not meet the needs of new strategies. One crucial aspect of this is to put solutions into of everyone in self-employment. Legislators should therefore deter- practice at the workplace level. Moreover, we need a new interministe- mine the appropriate level of protection which different types of workers rial innovation, research and transfer strategy for “Work 4.0”. The need, and include them in labour- and social-policy legislation accord- Federal Government’s existing research funding and transfer capabilities ingly. Looking to the future, it might be useful to base regulations for should therefore be dovetailed and expanded if necessary. In consultation crowdwork on our long-standing, tried-and-tested regulations for home with the social partners, we need to identify topics and areas for testing – workers (ª¥Chapter¥4.7). what we call ‘experimental spaces’ – which can then be trialled in sectors or individual companies, accompanied by scientific supervision. A major aim in further developing the welfare state’s institutions is to stabilise employability and facilitate people’s various transitions over Evolution rather than revolution is our way forward, not only in shaping their working lives. The concept of a Personal Activity Account would the digital transformation of the world of work, but also in relation to how see young workers granted initial capital, as a form of “social inher- we think about redistribution. Going beyond the WorkŁ4.0 dialogue, we itance”, which can be used for skills development, starting a business, need to reach a consensus in society on the future of the welfare state or career breaks for personal reasons. It could also be managed as a and its social security systems. long-term account individuals would be able to pay into. Today, the interplay between work and the welfare state can only be developed further when the broader European context is taken into account. This also applies to the consequences of the digital transformation, which must therefore also be discussed at the European level (ª¥Chapter¥4.8).

12 13 KEY

This White Paper is the culmination of an extensive consultation process. Many associations, institutions and companies have submitted responses to the key questions set out in the Green Paper. Members of the public have made their voices heard on the website www.arbeitenviernull.de or via social media. These comments, contributions and suggestions have fed into the White Paper – in some cases directly in the text itself, in some cases as quotes in the margin.

The following key explains the symbols used in the text to help readers navigate the document.

Term explained in the glossary ( p. 198)

---» Response to the Green Paper

» Reference in the text to a response

Two contradictory responses on the same issue

---» Comment from the public dialogue

» Reference in the text to a comment

Comment submitted via Twitter

Comment submitted via Facebook

Comment submitted via www.arbeitenviernull.de

(ª¥Kapitel 3.6) Reference to another chapter

15 DRIVERS AND TRENDS

1.1 DIGITALISATION 1.2 GLOBALISATION 1.3 DEMOGRAPHY AND THE FUTURE LABOUR SUPPLY 1.4 CULTURAL CHANGE 1 Drivers and Trends

1.1 DIGITALISATION

1. DRIVERS From papyrus to wax tablets to Word documents, from the horse and ---» These changes are affecting cart to railways and motor vehicles to self-driving cars, from the slide almost every sector, every organisation AND TRENDS rule to punch cards to grid computing – technology has always been a and every worker in Germany. « driver of change and societal progress. Digitalisation is at the centre of the Confederation of German Employers’ Associations Work¥4.0 dialogue, currently as its most important driver. It is a buzz- (BDA) word for all of the changes in the economy and the world of work ---» Work4.0 challenges us all to How are the parameters and conditions for social cohesion and our being driven by information technology. As digitalisation is having dif- examine issues in a new light. « work changing over time? What lines can we draw from recent decades ferent impacts in different countries – depending in part on their level ---» The digital transformation will, German Engineering Federation (VDMA) to the present and on into the future? To distinguish actual change from of technological development and other characteristics of their domestic little by little, completely change all mere hype, it is worth looking at the long-term trends. « economy – the debates about digitalisation in and outside Europe are functions along the value chain. This being conducted in very different ways.1 » applies in particular to development, This chapter provides a brief description of the most important drivers production, logistics and services. « and trends shaping tommorrow’s world of work: digitalisation, which A NEW LEVEL OF DIGITALISATION Robert Bosch GmbH creates new technological foundations and possibilities for collaboration, Over 80 per cent of workers in Germany currently use digital informa- production, company organisation and the sale of goods and services; tion or communication technology (ICT) in their work.2 The transition globalisation, which – boosted by digitalisation – has signiÿcantly expand- from analogue to digital technology has been under way since the ed companies’ and workers’ sphere of action in recent decades and facili- 1980s; the internet’s triumphant advance began in the 1990s, and the tated cross-border trade and communication, but has also led to a marked 2000s saw the dawn of the era of mobile devices. rise in migration flows; demographic change, that determines who, and ---» It is already the case today that with what skills, can participate in value creation now and in the future; We are currently reaching a point where digitalisation permeates points, signals, barriers, vehicles, lifts and ongoing cultural and societal change, which is transforming con- much of everyday life, value creation processes and work: the internet and stairs transmit information about sumption patterns and relationships, among others, and exerts a deci- allows communication not only between people, but also between their status to a central database. Clocking sive influence on which innovations are accepted and catch on, and things, i.e. objects which transmit data. The technologies driving digital in via smartphone, or buying tickets via which are not. structural change are likely to continue to develop rapidly for the fore- video links with ticket centres: workers, seeable future. Such developments are characterised by the fact that machines and products are becoming The interplay of these developments opens up many possibilities to gradual improvements lead to tipping points, beyond which a new level of increasingly interconnected and are work differently in future – more productively, flexibly, interconnectedly, applications becomes possible and enters the mainstream. Experts expect communicating in real time. The ana- internationally. But at the same time, this creates pressure for change, tipping points to be reached within the next ten years in relation to, for logue world is becoming more and adaptation and innovation, to which we must respond as individuals example, self-driving cars, complex products from 3D printing, and robots more linked with the digital world. « ---» No process is really new in and and as a society, on both the micro and macro level. The more clearly we delivering sophisticated services, such as those of a pharmacist.3 » Rail and Transport Union (EVG) of itself. But the depth and recognise why and in what shape new developments are emerging, the pace of change is. « more purposefully we can shape them in line with our society’s values Industrial Mining, Chemical and Energy Union (IGBCE) and rules. «

1 Grass/Weber 2016. 2 Federal Ministry of Labour and Social Affairs (BMAS) 2016a. 18 3 World Economic Forum 2015. 19 Drivers and Trends Drivers and Trends

Growth in mobile phone usage by 2020 The new level of digitalisation is being driven by advances in three In 2020, more people will have mobile phones than electricity at home areas.4 First, IT and software: processor performance is continuing to grow exponentially and is facilitating the use of cloud technologies People with mobile phones and mobile applications. Learning algorithms now justify the term 69% of the global population “artificial intelligence” for applications such as Watson, AlphaGo or Siri. Second, robotics and sensors: as systems become smaller and less People with electricity expensive, their range of potential applications and usability are increas- 68% of the global population ing, making them interesting for smaller businesses and individual manufacturing as well. Then there are new manufacturing techniques such People with bank accounts as additive processes, and improved control and data collection through 58% of the global population new sensors. Third, and crucially, connectivity: this is paving the way for People with running water the cyber-physical systems which are the basis for Industry¥4.0 , i.e. 45% of the global population networks of small computers equipped with sensors and actuators which are built into objects, devices and machine components, and People with cars which can communicate with each other via the internet.5 On this basis, 36% of the global population systems, machines and individual parts continuously exchange large quantities of information andcan, to a large extent, autonomously manage People with landlines production, inventory and logistics. Big Data can also lead to new busi- 28% of the global population ness models and customer-oriented services (e.g.¥process and sales Source: Cisco 2016. planning or predictive maintenance).6

The example of the car – the epitome of German engineering skill – THE ECONOMY IN THE MIDST OF CHANGE offers a good illustration of this permeation and the resulting change in The diffusion of digital technologies varies considerably between dif- business models. The product is changing in line with the technical ferent sectors in Germany.7 While the ICT and media industries have possibilities and customers’ wishes: cars are being individually conÿgured undergone several waves of digitalisation and change over the past two and increasingly connected in the Internet of Things , self-driving cars decades, this process still lies ahead for much of the manufacturing are becoming reality, and individual inspection intervals and remote sector.8 Whereas cutting-edge technologies are already being applied by servicing are possible thanks to new sensor technology and data analysis. half of German businesses, a third of them are yet to look into their use.9 ---» The digitalisation of work The production processes are almost completely connected, collaborative Across all sectors, the question of future competitiveness is also linked to processes enables companies to manage robot systems are entering factories, and additive manufacturing pro- how successful companies are in coping with the digital transformation. ---» From an SME perspective, the ever more complex work structures. cesses such as 3D printing are making extremely small production runs The ICT sector is not alone in offering examples of how this can be upheavals in the labour market caused This applies not only to management possible. Design and product conception work is being outsourced via achieved. In other sectors, too, such as the food trade, companies are by digitalisation will ultimately lead processes within organisations, but digital platforms, and workers have a say on shift assignments using apps. successfully tackling digitalisation and building on existing social part- to more value added. « also to the organisation of how Alongside the manufacturing and sale of cars, new services are gaining nership structures. » German Confederation of Small and Medium Sized Enterprises (BVMW) companies interact with external and in importance: from app-based car sharing, to carpooling models, to associated service providers and intermediaries for private driver services. This shows the breadth and manufacturing companies. « speed of the digital transformation; and it also makes clear that changes Industrial Mining, Chemical and Energy Union in technology, the economy, consumption and work go hand in hand. « 4 Expert workshop organised by the Federal Ministry of Labour and Social Affairs on “Digitalisa- (IGBCE) tion’s Impacts on Employment and Forms of Work”, http://www.arbeitenviernull.de/fileadmin/ Downloads/Dokumentation_WS_3.pdf 5 See, among others, Spath 2013; Forschungsunion/acatech 2013. 6 German Association for Information Technology, Telecommunications and New Media (Bitkom) 2015. 7 Federal Ministry for Economic Affairs and Energy (BMWi) 2015. 8 See also Apt et al. 2016. 20 9 Arntz et al. 2016a. 21 Drivers and Trends Drivers and Trends

---» In the services sector, almost a Digitalisation can lower transaction costs and increase efficiency. THE PRODUCTIVITY PUZZLE third of total growth in value added in Many associations of trade and industry and consultancies expect high Productivity growth has slowed considerably in many industrialised countries Germany from 1998 to 2012 can be productivity gains in ICT and the manufacturing sector in the coming since the year 2000. The fact that digitalisation’s significant growth potential is 10 attributed to digitalisation – in total years. That said, at present there is still disagreement about the ex- currently not reflected in productivity statistics is sometimes referred to as the and in absolute figures, this represents tent to which productivity growth in the digital economy can be shown “productivity puzzle”. an impressive 95.1 billion euros. and measured (see box on “The Productivity Puzzle”). The prerequisite The observed sluggishness of productivity growth has strengthened propo- The importance of services is increas- for achieving productivity growth is, in any case, significant business nents of “secular stagnation”.12 According to this interpretation, today’s technical ing as a result of digitalisation. « and public investment in infrastructure, technology, work processes progress is merely incremental in nature. The argument is that there are no major United Services Trade Union (ver.di) and skills. « developments today on a par with past inventions which led to signiÿcant productivity gains, such as the steam engine, the car or the electric motor, because the “low-hanging fruit” of industrialisation has already been picked, and the seventh The digital transformation will, Alongside traditional companies, start ups play a key role as drivers of ---» version of the iPhone simply does not constitute a major leap forward.13 if successfully managed, help in the innovation. Larger companies often buy start-ups to drive innovation, long term to maintain the com- or set up their own departments or subsidiaries as autonomous “labs” In contrast to these “technological pessimists”, the “technological optimists” petitiveness of industrial production to develop and test new ideas. In addition, publicly funded research is believe the digital revolution will lead to significant productivity gains in the near future.14 The weak growth at present is, they argue, a temporary phenom- in high-wage Germany, and to safe- of vital significance.11 enon and attributable in particular to companies’ investment restraint during guard growth and employment. « the phase when the transformation or shift is taking place from the analogue German Engineering Federation (VDMA) world to the digital world, in which old business models are becoming obsolete and new business models are requiring high levels of initial investment.15 In addition, it has been observed that new technologies have not yet become mainstream.16 Thirdly, it is argued that the statistics are distorted by problems in 10 Rüßmann et al. 2015; Bauer et al. 2014. 11 On the significance of public investment for the economic development of new technologies, collecting information – with new goods not yet appearing in the production see also Mazzucato 2014. statistics, while the decline in the production of traditional goods is reflected in full. This is said to be especially relevant with regard to digital goods and services, which have produced welfare gains but whose value is (at present) only partly visible in the National Accounts.17

All in all, there should be no rush to conclude that the weaker growth at present means that digitalisation offers little potential for future productivity gains. Moreover, some of the explanations for the slowdown in productivity growth in Germany – growth in employment, demographic change or the “end of the outsourcing wave” – are not connected to digitalisation. The latter could therefore be cushioning the impact of factors which are holding back productivity growth.

12 This term was coined by the economist Alvin Hansen in the 1930s. It refers to a situation where economic growth is approaching a standstill. Today, Lawrence Summers, Paul Krugman and Robert Gordon are key proponents of this theory. 13 See Gordon 2015. 14 See Brynjolfsson/McAfee 2014. 15 Heise et al. 2015. 16 Andrews et al. 2015. 17 Grömling 2016. 22 23 Drivers and Trends Drivers and Trends

In the public debate about digitalisation, a distinction is often made 1.2 GLOBALISATION between two approaches. In Germany, the focus is on the buzzword Industry¥4.0 and new production processes involving cyber-physical systems (ª¥Chapter¥2.4). Besides manufacturing, attention is also increas- Global trade is not a new phenomenon. Even in antiquity, traders and ingly being devoted to industry support services which use Big Data . merchants did business across continents. However, it was industrialisa- These smart services are intended to preserve industry’s value added tion and the associated spread of new technologies, from railways to steam compared to competitors from the IT sector and to open up new business navigation, which ushered in a massive expansion in the international ---» The German economy’s models. In the United States, by contrast, digital platforms for services are division of labour and a first wave of globalisation. Today, the term industrial base is strong and well- playing a greater role (ª¥Chapter¥2.2). The “German approach” is often “globalisation” is usually used to refer to the second wave of rapid accel- placed to profit from digitalisation. « described as more incremental – with gradual changes to existing sys- eration in the worldwide flows of goods, services, capital, and people Confederation of German tems – while the “US approach” is tagged as disruptive – with existing from the mid-20th century onward and in particular since the 1980s.18 Employers’ Associations (BDA) companies and business models being crowded out. « The German economy has always been very closely integrated into On closer examination, however, this distinction proves to be overly world trade and global value creation, and this has intensified further simplistic: digital platforms and their network effects are becoming over the past quarter of a century. At the start of the 1990s, Germany’s more important for manufacturers, too. The importance of collecting, openness ratio (imports plus exports as a share of gross domestic product) analysing and using application data is rising for services and manufac- was already above 40 per cent. Over the following 25¥years, it doubled to turing. The move by IT companies into producing goods (household its current level of 86 per cent – the highest level among the larger OECD goods, media devices, cars in the near future), on the one hand, and the industrialised economies, after South Korea. The McKinsey Global Insti- new services which manufacturers are offering (leasing, maintenance, tute even ranks Germany in top place, ahead of Hong Kong and the car sharing), on the other, are just a few examples of how the lines are United States, in its Connectedness Index, which, in addition to trade, blurring and companies are moving into new markets. In this context, takes into account cross-border financial transactions, data and com- the importance of personal and industry support services is expected to munication flows and flows of people.19 ---» The question is whether the rise significantly in future. The way in which digitalisation shapes our outlined distinction between a German society will be determined by new technologies, as well as by the eco- innovation model which seeks incremen- nomic costs of implementation, consumer preferences, societal values, tal process improvements and a disrup- the development of the working world, negotiations between the so- tive model from Silicon Valley can be cial partners, and the parameters established by policy-makers. Not maintained in our global world. « every digital platform model, if it is even profitable in the long term, German Trade Union Confederation (DGB) will succeed in a social market economy like Germany. «

---» There can and must be no rose- tinted view of the potential implications of digitalisation. It is essential to be able to set out the risks objectively without being accused of backwardness. « Marburg Federation of Doctors (MB)

18 Between 1980 and 2008, the real volume of world trade quadrupled, growing twice as fast as world production; see World Trade Organization 2013. 24 19 McKinsey Global Institute 2014. 25 Drivers and Trends Drivers and Trends

---» Flexible forms of employment, DIGITALISATION AS A DRIVER OF GLOBALISATION On the demand side, values and consumer attitudes are changing; ---» For me, the future of work means such as temporary agency work, Just as the steam engine was once the technology which drove glo- digital communication can result in the rapid diffusion and transcending being more mobile and žexible, but also fixed-term employment, part-time balisation, changes in recent decades have been driven by exchange with- of regional and national orientations, but on the other hand it can also more replaceable. Globalisa tion and work and self-employed work give in a global information and communication space.20 This is clear not least reinforce these orientations (ª¥Chapter¥1.4). In parallel with this, aware- technologisation make it possible to companies the necessary ability to from the increase in digital data «ows: while trade in traditional goods and ness of consumption’s local and global impacts on working and environ- produce the same quality of work adapt to a volatile environment. « services and cross-border direct investment roughly doubled between mental conditions has been growing for some years, especially in more from anywhere quality of work from Daimler AG 2005 and 2014, cross-border internet traffic grew eighteenfold over the prosperous countries, and individuals are increasingly questioning their anywhere « same period, and the bandwidth used has increased by a factor of 44.21 own consumption patterns in this light. 21Apr. 2015 via arbeitenviernull.de

On the supply side, companies are increasingly serving a global cus- Facets of globalisation tomer base and are restructuring their work processes and corporate ---» Companies’ increasingly inter- KNOWN TRENDS RECENT DEVELOPMENTS ---» Companies outsource work to organisation accordingly. They are exposed to shifting market condi- national focus has an impact on worker contractors even though they are tions, the influence of financial investors and more volatile demand. Growing importance of particpation, which is based on the Cross-border trade mainly digital ows of potentially outsourcing core compe- One solution used in practice is to increase the potential for greater in physical goods and services territoriality principle. A staff rep- information and data tencies, with far-reaching implications internal flexibility (e.g. working time arrangements ª¥Chapter¥2.5) and to resentation body which is limited to for their very existence. « make full use of possibilities for greater external «exibility (e.g. temporary monitoring the execution of decisions Capital- and labour- More knowledge-based Hans Böckler Foundation taken elsewhere is not fulfilling its agency work, contracts for work and services) (ªChapter¥2.6). Compe- intensive processes processes tition is a driver of further innovations, productivity gains, and cost reduc- original function. « ---» Digitalisation is increasing tions. Businesses and their investor structures are increasingly multina- Conference of the Labour and Social Affairs Focus on transportation More important role Ministers of the Länder global interconnectedness and the tional, whereas decision-making increasingly takes place in a more infrastructure for digital infrastructure international division of labour in decentralised manner. Companies are more and more integrated in value production and services. We may see a networks across the boundaries of their own businesses, while at the Digital working, especially in Growing role of small ---» Multinational companies rise in cooperation with international same time acting in or organising various regional value chains. Cross- enterprises and international production networks, is as drivers individuals partners – including in real time, border trade in goods produced in different parts of the world has long superimposing itself on the traditional around the world, i.e. in different since ceased to be globalisation’s only main feature; it is now joined by the concept of a company and posing new Ideas diffuse Direct and global time zones. « global division of labour already during the production of these goods. « comparatively slowly access to information challenges for the worker parti cipation across borders is possible Association of German Chambers of Commerce culture. « and Industry (DIHK) Shorter product life cycles and smaller lot sizes, which are transform- Daimler AG Flows of goods and services Greater participation by ing the parameters for industrial mass production, mean that flexibility mainly between more emerging economies and and speed, in particular, are of great and growing importance, while the advanced economies developing countries focus on labour costs is tending to decline by comparison.22 In sectors Source: Adapted from Manyika et al. 2016. where the share of labour costs is in retreat as a result of digitalised and automated processes, a “reshoring” of previously offshored production is conceivable. Globally interconnected value creation thus has diverse impacts on investment plans, the development and collaboration of business sites, and on workers’ working and contractual conditions, earning opportunities, the skills they require, and their opportunities for workplace participation. »»

20 Boes et al. 2014. 21 McKinsey Global Institute 2015. 26 22 Coe/Yeung 2015. 27 Drivers and Trends Drivers and Trends

EFFECTS OF GLOBALISATION ON THE DISTRIBUTION OF 1.3 DEMOGRAPHY AND THE WEALTH How globalisation trends have affected the distribution of wealth FUTURE LABOUR SUPPLY between and within countries is a hotly debated issue. Between 1980 and 2010, the share of developing and emerging economies in world exports rose from around a third to almost half.23 This went hand in The effects of demographic change are already being clearly felt in hand with major shifts in the international division of labour. Globalisa- Germany. While the size of the population has remained almost stable tion in the field of international trade in goods and technology transfer over the past 20 years, the proportion of older people has increased. By the can also open up new employment opportunities for more highly end of the 2020s, almost a fifth of the working-age population will be skilled workers in less developed economies.24 The economic integra- aged between 60 and 66. The life expectancy of infants born today is 11 tion of Asian countries, especially those with large populations, has signiÿ - years longer than in 1960. At the same time, the number of years in cantly reduced poverty from a global perspective. which people enjoy good health is rising. One of the reasons for the ageing population is the sustained low birth rate. Since the mid-1970s, in the In industrialised countries, however, affected by structural change as wake of the baby boom between 1955 and 1969, women in Germany have a result of the relocation of production sites and falling demand for been giving birth to around 1.4 children, in statistical terms.27 As a result, lower-skilled employment, there were also groups which lost out. And each generation of parents is followed by a generation of children which in developing countries that were less successful in integrating into is a third smaller. An average rate of 2.1 children per woman would be global production processes, the economic situation has actually necessary to maintain the population at its current level. worsened for sections of the population.25 Overall, income inequality is at its highest level for 30 to 40 years in most industrialised countries.26 The consequences have been visible in the labour market since the ---» Addressing the implications of In Germany, it has increased sharply in terms of market incomes in mid-1990s, with the gradual entry of the “baby-bust” generation. So an ageing workforce poses a challenge. recent decades, although this has been partly offset in terms of net far, the impact of the lower birth rate on the labour supply has been It must be ensured that experienced household incomes by means of redistribution via the tax system and largely offset by an increase in labour force participation, particularly in and motivated older workers continue social security contributions. the case of women and older people. In future this will be less effective to work productively and with motiva- in offsetting the impact, however, as much of the potential has already tion until they retire. This requires a In summary, it is clear that it has long been inadequate to look solely been leveraged.28 By the mid-2030s the baby-boom generation will sustainable and forward-looking com- at flows of goods and services when it comes to analysing globalisation gradually be retiring, with the first baby boomers already reaching the pany policies. « trends. The recent refugee flows are far from the first indication that statutory retirement age in the next few years. Growing shortages in Employers’ Association of Insurance Companies special attention should be devoted to demographic and migration the recruitment of skilled workers are emerging in certain occupa- in Germany (AGV) trends (ª¥Chapter¥1.3). Wherever globally driven structural change and tions and regions. »» increased international migration flows lead to distributional conflicts, pressure for renationalisation and for the metaphorical drawbridge to ---» Above all, “Work4.0” means be pulled up will not be far behind. addressing demographic and structural change. We will need all hands on deck, whether employed or self-employed. We need flexible regulations! « 23Apr. 2015 via arbeitenviernull.de

27 According to the Federal Statistical Ofÿc e, the birth ratio is 1.5 children per woman at present (2015). 23 World Trade Organization (WTO) 2013. 28 Despite the increase in female labour force participation, there remains a significant “working time 24 Vivarelli 2014; United Nations Conference on Trade and Development (UNCTAD) 2014. gap” between men and women. Women’s average weekly working time is, on average, eight hours 25 Milanovic 2016. lower than men’s. 28 26 Organisation for Economic Cooperation and Development (OECD) 2015. 29 Drivers and Trends Drivers and Trends

LABOUR SUPPLY AND IMMIGRATION THE POPULATION’S SKILLS LEVEL Growing national and international mobility is another factor in demo- Another key in preventing shortages of skilled labour is avoiding a graphic change. The difference between the number of people moving mismatch between the demand for skills and its supply. For this reason, to a country and the number leaving it is known as net migration. In the population’s skills level plays a special role in meeting the demand 2015, immigration to Germany reached a record high. According to the for skilled workers. provisional migration statistics, net migration was 1.1 million, with approximately 2.1 million people coming to Germany and just under a The working-age population’s level of educational attainment has million leaving the country. Between 1990 and 2015, over 280,000 more risen in recent years: 41 per cent of a school year group now attains the people came to Germany each year on average than moved away. higher-education entrance qualification, compared to 30 per cent in 2006. Women now account for a larger proportion of this group than men. Net migration to Germany, 1991-2015 Breakdown of the population’s educational qualifications by age 1,200,000 and gender

1,000,000 Women Men 100% 800,000 90% 600,000 80% 400,000 70% 200,000 60% 0 50% ---» It is essential to use the existing -200,000 1991 1995 1999 2003 2007 2011 2013 2015 skilled labour pool in our population 40% and widen the group of potential Germans Foreign nationals applicants as much as possible, espe- 30% cially with regard to foreign nationals. Source: Federal Statistical Office, 2016. 20% Despite the drama of the situation, the 10% current massive migration of refugees Migration to Germany at present largely consists, alongside immigra- to Germany should be seen as an tion from other European countries, of people who have fled their 0% opportunity to recruit qualified skilled countries. Due to their generally young age – more than half of those Age: 65+ all 20–24 65+ all 20–24

workers among them for the German who arrived in Germany seeking protection in 2015 are under 25 years No general school- Intermediate school labour market and permanent employ- old – these migrants have mainly increased the size of the working-age leaving certiÿcate certiÿcate or equivalent ment in Germany. « population. Integrating them into the education system and the labour Lower secondary Higher education dbb – German Civil Service Federation market will be one of the main challenges in the coming years. « school certiÿcate degree

Source: Based on data from the Federal Statistical Office and the Federal Institute for Population Research, 2015.

30 31 Drivers and Trends Drivers and Trends

Meanwhile, the proportion of those leaving school with a lower second- new normal increasingly also includes households with one and a half to ---» The traditional family model ary school (Hauptschule) certificate is 21 per cent, compared to 27 per two incomes, and working single parents. »» centred around a (usually) male sole cent in 2006. The proportion of school leavers who do not attain a lower breadwinner is becoming less and less secondary school certificate has fallen from eight to six per cent. How- Breakdown of labour market participation in two-parent families common. Ever more young couples ever, social background continues to exert a major influence over educa- want to split the time they spend on

tional attainment. In particular, children with a migrant background 50% family responsibilities and work as remain underrepresented in academic secondary schools (Gymnasien), equally as possible. « 40% but account for a higher than average share of early school leavers and Bremen Chamber of Labour school leavers with a lower secondary school certificate. Despite some 30% progress, it is still more difficult for young people with a migrant back- 20% ground to obtain a vocational training place.29 ---» I would like to have more time 10% for my children in future and be able to

The link between skills level and income is equally clear. According to 0% organise my working hours flexibly. calculations by the Institute for Employment Research (IAB), workers 1996 2003 2015 Developing a suitable strategy for this who have completed a vocational training programme earn, on average, Men: full-time/ Men: full-time/ would be great! « Women: part-time Women: not economically active almost a quarter of a million euros more over their entire working lives 22 Apr. 2015 via arbeitenviernull.de than workers who do not have a vocational qualification or the higher- Both full-time Both part-time education entrance qualification (Abitur). Higher-education graduates, meanwhile, earn over 1.2 million euros more, which equates to average Source: Federal Statistical Office, special analysis from the 2015 Microcensus. lifetime earnings more than twice as high.30 In the course of these developments, individuals’ preferences regard- ---» Many people find it very chal- ing their own work are also changing. Women and men want to work on lenging to combine work and family a more equal basis, share family responsibilities, and also be able to pursue commitments in the way they would 1.4 CULTURAL CHANGE personal interests. The ties between generations have also changed. prefer. This is especially true in life When parents and grandparents live in different places, there are huge phases with intensive caring commit- differences in the extent to which the grandparents are available as a ments, such as when looking after The transformation of the economy and society is accompanied by “flexibility buffer” for childcare. At the same time, more children are young children or caring for elderly changes in lifestyles and values. Important issues in this context include living at home for longer, and in some cases they are being financially family members. « individualisation, changed visions of family life and social cohesion, supported by their parents until well into adulthood. » Forum for Progressive Family Policy (ZFF) greater diversity in life plans and preferences regarding work, and new consumer attitudes.

FAMILY MODELS AND TIME-MANAGEMENT NEEDS ARE CHANGING The transformation of social values and relationships is also reflected in a more partnership-based conception of gender roles. Due to the steady rise in female labour force participation, in more than half of all couples both partners now work, although women often still work part- time.31 Traditional single-income households do still exist. However, the

29 Authoring Group Educational Reporting (Autorengruppe Bildungsberichterstattung) 2016. 30 Schmillen/Stüber 2014. 32 31 Federal Ministry for Family Affairs, Senior Citizens, Women and Youth (BMFSFJ) 2015 33 Drivers and Trends Drivers and Trends

---» Long-term care is a task for For the generation of parents aged 30 to 55, who make up almost a Preferences regarding work: seven value systems society as a whole which is third of workers, time becomes a scarce resource as they do their best undertaken by an individual. « to combine professional commitment and advancement, bringing up Finding a work-life Finding fulÿlment in dbb – German Civil Service Federation children, and the pursuit of personal interests.32 This time crunch, balance: 14% work: 10%

which is exacerbated further in the absence of an adequate care infra- Seeking meaning structure, is likely to intensify in an ageing society if more and more outside work: 13% PERSONAL DEVELOPMENT ---» Working time sovereignty for workers face the additional responsibility of caring for infirm family 33, 34 6 employees is still very limited, members, on top of their work and parental responsibilities. Matters Meaningfulness 5 despite the introduction which have “traditionally” been of particular importance for workers, Mismanagement IDEAL Scope for action Social callousness of greater flexibility. such as security and pay, are therefore being joined by the desire for 7 « PERFORMANCE 4 German Trade Union Confederation (DGB) greater time sovereignty . COMMON GOOD « Incompetence 3 STRUGGLE FOR 1 EXISTENCE GREATER DIVERSITY IN PREFERENCES REGARDING WORK 2 Stagnation ---» At the same time, workers’ need The “discovery” of one new generation after another (such as Gener- Solidarity Prosperity Economic interests for greater time sovereignty is rising. « ations “X” and “Y”) points to a shift in values. Yet such generalised Convention STABILITY Gesamtmetall – Federation of German Employers’ descriptions of different generations tend to overlook constants: for Materialism Associations in the Metal and Electrical example, a secure and well-paid job remains the most important aspect Engineering Industries of decent work for today’s new entrants to the labour market.35 Conformity Being able to Achieving peak live comfortably performance It seems more useful to look at the diversity in workers’ preferences from work: 28% Working within a Working hard via dedication: strong community of for prosperity: 11% regarding work and the welfare state as a whole. The Federal Ministry of solidarity: 9% 15% Labour and Social Affairs has therefore funded an unprecedented study, which draws on IT-based qualitative interviews with a representative Source: Federal Ministry of Labour and Social Affairs (BMAS)/Nextpractice 2016 sample of 1,200 working people in Germany. The study “Value Systems in the Context of Work 4.0” (Wertewelten Arbeiten 4.0) highlights the diversity in the reality of workers’ lives and their preferences.36 The study identifies seven typical value systems with discrete perspectives on the subject of work. Sociodemographic characteristics such as age, income or level of educational attainment can only partly explain the respondents’ adherence to certain value systems – unlike in the case of traditional social environments in earlier times. In terms of the attitudes and positions which guide people’s actions, these value systems are in some cases diametrically opposed (see box). Differences exist not just in people’s perceptions of the status quo, but also regard- ---» For me, work in the future means 32 To date, it is predominantly women who reduce their gainful employment in favour of unpaid ing their views on shaping Work 4.0. What some regard as a desirable combining work and the personal sphere work. The Federal Statistical Office’s 2012/2013 Time Use Survey shows both a gender imbalance future is a threatening scenario for others. » rather than separating them, and ben- in the distribution of paid and unpaid work and a higher overall burden on households with children. Unpaid work accounts for almost twice as high a share of women’s working time as paid eÿting from this, e.g. coming up with ideas work. By contrast, 62 per cent of men’s working time consists of paid work, while unpaid work while cycling. « accounts for just 38 per cent. (Federal Statistical Office (Destatis) 2015a). 21 Apr. 2015 via arbeitenviernull.de 33 Bauer et al. 2012. 34 Four out of five people in need of care are cared for at home (Federal Statistical Office (Destatis) 2015b). The rising proportion of people entering higher education means that graduates, in particular, are entering the labour market later in life. It is therefore increasingly common for workers to have to not only begin and advance their careers and start a family simultaneously or within a short space of time, but also to undertake advanced training and care for relatives in parallel. 35 Federal Ministry of Labour and Social Affairs (BMAS) 2015a. 34 36 Federal Ministry of Labour and Social Affairs (BMAS)/Nextpractice 2016. 35 Drivers and Trends Drivers and Trends

SEVEN VALUE SYSTEMS Finding fulfilment in work (10 per cent) The ideal work situation for people with this value system is characterised by Being able to live comfortably from work (28 per cent of respondents) opportunities for them to constantly reinvent themselves and have many exciting People who share this value system primarily want to be able to lead a normal experiences. They see themselves as part of a network of likeminded people, one life in a secure community without material worries. They see work as part of this, which stretches beyond Germany. For them, there is no contradiction between but in some cases they are finding that it takes up so much of their lives that personal fulfilment and performance and efficiency. They expect the state and little time remains for personal matters. Being able to plan ahead is a key posi- employers to support people on their individual paths, for example through tive value for them, while they regard a faster pace of work and growing perfor- flexibility in working time and location, and comprehensive childcare. mance pressure as negative. They expect the state to provide a safety net for all those who contribute to society. Finding a work-life balance (14 per cent) For people with this value system, work is ideal if it can be balanced with family Working within a strong community of solidarity (9 per cent) commitments, personal fulfilment and involvement in shaping society. At the For people with this value system, an ideal world of work is characterised by same time, they expect every individual to show a certain degree of personal mutual loyalty, appreciation for their performance, and participation in a com- responsibility. In their view, society’s purpose is to jointly create good condi- munity of solidarity. They find developments within society worrying in some tions for all. The business and working world should adapt to people’s needs, respects. They have the feeling that more and more people are falling through not vice versa. They are not willing to sacrifice their principles for material secu- the cracks and are no longer ÿnding a place in society. They long for the days when, rity. They therefore expect the state to provide opportunities for effective involve- as they see it, companies cared about the wellbeing of their staff, there was work ment in shaping society. for all, and people stood by each other even in hard times. They believe the state and companies have a duty to return to focusing more on the wellbeing of all. Seeking meaning outside work (13 per cent) The people with this value system do not regard paid employment as the Working hard for prosperity (15 per cent) only possible meaningful activity. They measure an activity’s value by its contri- A lifetime of hard work is regarded as a given by people who adhere to this bution to the common good. They often regard charitable work as more mean- value system. They believe that everyone who really works hard can succeed, ingful than work carried out primarily for financial reasons. They expect the state although they are noticing that this is no longer as simple as it once was. And to guarantee all citizens an adequate amount to live on, irrespective of what in their view, those who have made it are entitled to treat themselves to a little income they earn in the labour market. luxury. They expect the social partners to ensure that Germany remains strong in economic terms and that high achievers continue to have a home here. They expect the state to create conditions which ensure that everyone who works hard can achieve a certain level of prosperity. At the moment, however, they feel they are not experiencing a sufficient level of success and recognition despite working very hard.

Achieving peak performance via dedication (11 per cent) For people with this value system, the ideal vision of work is characterised by responsibility, efficiency and striving to perform to the best of their potential. They regard the rapid pace of developments in the economy and society, including those resulting from digitalisation, as a welcome challenge rather than stressful. In their view, it is up to every individual to get to grips with the new challenges, for example through lifelong learning. They expect the state to create conditions which enable individuals to deal with the individual challenges of a changing world of work. They regard these conditions as mostly being in place, as their experience has been that particular dedication leads to personal success.

36 37 Drivers and Trends Drivers and Trends

---» Greater self-determination in For some respondents, digitalisation offers the possibility of greater CULTURAL CHANGE AND NEW CONSUMER NEEDS the context of work means shaping self-determination in the context of work, while others see a risk of fur- The new possibilities of digitalisation and the changes in our culture working conditions and giving people ther work intensification or job losses. The picture is similar when it and everyday life are interrelated. Widespread access to information, options so as to allow the emergence comes to the buzzword “flexibility”. The contradictory views held about communication via social networks, the influence of algorithms on of life prospects with self-determined the world of work from a historical perspective are of particular cause for our thoughts and actions – all of this will fundamentally change our and selectable planning horizons. « concern: almost half of workers are sceptical or pessimistic about the society. It is not yet possible to say with any certainty whether a “digital Association of Staff Councils of future, believing that their ideal vision of work came closest to reality in culture”37 is emerging and to what extent it, in turn, will transform the the Supreme Federal Authorities the post-war decades. For the optimists, the opposite is true. However, world of work. there are also shared beliefs: the majority are opposed to precarious employment which violates the principle of fair pay, and to high levels What is already clear is that changes in consumer habits are having of work intensification . There is a strong desire for social cohesion an impact on working life. E-commerce has radically changed many ---» Cohesion in communities and and participation. « sectors. As customers, we shape the business and working world in society as a whole is not ensured through our demand for services which others provide. In some respects, solely by economic goods; a shared The study shows that today there is less of a homogenous “workers’ changes in social structures and values are giving rise to entirely new stake in cultural goods also plays a perspective” than ever, just as there has never been a single “employers’ consumer habits and needs, which can in turn be satisfied better or in part, including a shared experience, perspective”. People in Germany have in some regards contradictory, new ways by the digital economy. perception and organisation of time. « and in some regards shared visions of an ideal working environment German Bishops’ Office and working life. For example, temporary access to and time-limited use of products ---» The line between producers (e.g. cars) and data (e.g. music) seem to be gaining ground compared to and consumers is becoming blurred in traditional ownership. The desire to lead more sustainable lives and the case of prosumers, for example if engage in more sustainable consumption is also inspiring a new sharing a consumer uses software to design an economy . At the same time, customers expect their needs to be satis- individual piece of furniture which ÿed more quickly in the “on-demand economy”. Both sides of the coin are is then produced in a digital factory. « examined in greater depth in Chapter 2.2. As prosumers or as “suppliers” Bremen Chamber of Labour of data and self-generated content, customers and users are active participants in the process of innovation and value creation. »

The implications for society are mixed, with positive prospects in ---» Services in the logistics and terms of environmental sustainability and economic growth on the one distance selling sector are in demand hand, and growing pressure on labour standards and pay conditions around the clock – driven by consumers’ and a potential increase in low-skilled work in the service sector on the desire to be able to purchase items 24 other. The organisation of the work of the future therefore cannot be hours a day with the click of a mouse, separated from the question of what demands we will and should make and ideally to receive their purchases as consumers. » immediately by express delivery; driven by the competition between individual online retailers to achieve the highest turnover. « Social Organisation Germany (SoVD)

38 37 Stalder 2016. 39 CHALLENGES PRESENTED BY WORK 4.0

2.1 EMPLOYMENT EFFECTS: TRANSFORMATION OF SECTORS AND ACTIVITIES 2.2 DIGITAL PLATFORMS: NEW MARKETS AND NEW FORMS OF WORK 2.3 BIG DATA: THE RAW MATERIAL OF THE DIGITAL ECONOMY 2.4 INDUSTRY 4.0 AND THE HUMAN-MACHINE INTERACTION 2.5 FLEXIBLE WORKING TIME AND LOCATION: BEYOND PRESENTEEISM 2.6 COMPANIES: ORGANISATIONAL STRUCTURES IN TRANSFORMATION 2 Challenges

2. CHALLENGES time avoiding overwork caused by a breakdown of the boundaries between work and private life ? Ultimately, answers to all of these PRESENTED BY WORK 4.0 questions must be found in practice by companies, which are undergoing a fundamental transformation. They are facing the question of how a company should be organised in a fully interconnected world and what impact this has on how people work together. Based on the analysis of long-term trends and driving forces in Chapter 1, this chapter examines their effects on the world of work and The different subchapters first identify what is really new, then go on the labour market. Its sections look at fundamental questions and to examine the contradictions and tensions associated with these challenges relating to the digital transformation. The impacts on developments. What becomes clear is that the opportunities and risks employment, in particular, are hotly debated in the media: will we lose depend on what action we take, and decisions must be taken on the or gain more jobs as a result of digitalisation and automation? Under basis of careful analysis and in the knowledge that conflicting aims exist. what circumstances can we tap into new employment? The new developments can be directly experienced through digital platforms, which are changing our everyday lives. But do they fit in with the business and working world of a social market economy , or is there a need for new rules or even a new framework? Digitalisation is based on data which is collected, stored and analysed: it is a new raw material for the economy. Do we need more or less data protection in order to seize the opportunities of Big Data effectively and safely? And who actually owns the data? The relationship between humans and machines is also changing: what will the computers and robots of the future be able to do, and what human capabilities are irreplaceable? Who will give instructions to whom in future? What requirements do companies have in terms of flexibility? How can we use flexibility in working time and location to develop new solutions for a work-life balance and achieve a fairer distribution of paid and unpaid work between men and women, while at the same

42 43 Challenges Challenges

2.1 EMPLOYMENT EFFECTS: THE GERMAN LABOUR MARKET IN TRANSFORMATION TRANSFORMATION OF I: UNEMPLOYMENT AND WAGE TRENDS The German labour market has undergone a profound transformation over the past 25 years. During the short post-reunification boom, unemployment in SECTORS AND ACTIVITIES western Germany fell to 1.6 million in 1991, while mass unemployment set in immediately in the east as a result of plant closures. Subsequently, from 1992, the west also experienced a sharp rise in unemployment. The economic upswing in the late 1990s brought more people into employment again, but ended at the Overall, developments in the German labour market have been turn of the millennium. Several years of economic stagnation followed, during positive in recent years. The global financial and economic crisis was which unemployment rose once more. It reached a record high at the beginning weathered successfully. Skilled migration has so far been able to of 2005, when unemployment and social assistance were merged. Since then, with offset the negative impacts of demographic change. Following a the exception of the financial crisis in 2009, unemployment has fallen steadily and is currently at its lowest level since reunification, at around 2.6 million. decline in the 1990s and the early 2000s, the labour force has risen by over four million people since 2005. The number of workers in Unemployment in Germany, in millions of people jobs with compulsory social insurance coverage has increased by

around 4.5 million in the past ten years to over 31 million people. 5,0

4,0

3,0

2,0

1,0

0,0 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016

All of Germany Western Germany Eastern Germany

Seasonally adjusted monthly figures, Federal Employment Agency As at: September 2016

Times when unemployment is high are also periods of weak wage growth, as they have a detrimental effect on employees’ negotiating position. The decline in collective bargaining coverage also played a role; this trend began at the end of the 1970s and continued in post-reunification Germany. In 1998, the first year for which data is available from the relevant time series in the IAB’s Estab- lishment Panel survey, the level of workers’ collective bargaining coverage for the western German economy as a whole was still just short of 76 per cent, and this figure has since fallen almost continuously, recently (2015) reaching 51 per cent. The level in eastern Germany was 56 per cent in 1998 and just 37 per cent in 2015.38

44 38 Ellguth/Kohaut 2016 45 Challenges Challenges

The labour share (workers’ wages as a proportion of national income) fell by With regard to future developments in the labour market, the key ---» For years, the insurance industry around five percentage points from the mid-1990s. Real wages initially rose at questions are: What will digitalisation’s overall employment impact be? has seen a decline in the need for simple, the beginning of the 1990s but then stagnated until into 2009, and even fell Will jobs be lost? If so, who will be affected? By contrast, in what areas routine activities, and a rise in demand during the intervening period, with significant disparities between sectors in will new jobs be created? The clear answer used to be that low-paid for graduates. In the long term, the some cases. jobs, especially for the low-skilled, would be lost. In the current discus- sector expects digitalisation to result Real wages in Germany, 1991-2015 sion about digitalisation, however, there is a widely held theory that in changes to its workforce structure. « middle-skilled activities, especially those which are routine-intensive, Employers’ Association of Insurance Companies could increasingly be automated, such as bookkeeping or product test- in Germany (AGV) 110 ing. While there have recently been indications in Germany of a trend 108 towards a decline in the importance of routine, middle-skilled tasks, 40 106 there is no sign as yet of any collapse in employment in this area. »

104 Current studies are grappling with the question of whether and to ---» Work 4.0 = 102 what extent technological unemployment will be a key concern in future. Germany running out of work. « Some studies and popular science texts have even reignited the discussion 17 May 2015 via Facebook 100 about an “end of work” .41 They look at digitalisation’s potential for 98 automation and argue that intelligent machines and algorithms will 1991 1994 1997 2000 2003 2007 2010 2013 2015 replace most workers in the long term. Technological advances have been sparking similar predictions ever since the invention of the loom. » Index: 1991=100. Source: Federal Statistical Office ---» Industrial revolutions have The much-quoted finding by Frey and Osborne (2013) that 47 per cent never destroyed jobs on a massive scale. It is only since 2014 that real wages in Germany have risen noticeably again – supported in part by very low inflation. It is not yet possible to put a reliable of jobs in the United States are at risk due to automation (42 per cent in #Industry40 won’t either. figure on the impact of the statutory minimum wage. However, workers Germany), assumes everything that theoretically can will in fact be auto- #arbeitenviernull « with below average earnings, in particular, have benefited from much greater mated, and that all activities required in certain occupations can be auto- 24 Nov. 2015 via Twitter increases recently. mated.42 In reality, however, only specific individual activities are being

Weak wage growth was accompanied by a marked rise in wage inequality. automated, not necessarily entire occupations. If this is taken into con- One explanation put forward to account for this is a rise in skills-related wage sideration, around 12 per cent of workers in Germany today hold jobs differences as a consequence of technological progress. Experienced, high- which are at a high risk of being automated.43 Again, this is only a potential skilled workers benefited, in particular, while low-skilled workers lost out. risk, as there are many legal, societal and economic limits on automation. Other explanations include institutional influences such as the decline in collective bargaining coverage and rising pay differences between individual compa- In addition, workers are adjusting their activities and taking on more nies in the same sector.39 Since 2010, wage inequality has not risen any further, complex tasks.44 Bearing in mind that each year over three per cent of and has even declined slightly at times. workers in Germany change occupation, and, in the long term, a fifth of workers do not work in the occupation for which they have been trained, puts the predicted impacts on employment into perspective.45

39 Möller 2016.

40 Eichhorst et al. 2016. 41 Including Brynjolffsson/McAfee 2014; Kurz/Rieger 2013; Ford 2015. 42 Frey/Osborne 2013. 43 Bonin et al. 2015, Übertragung der Studie von Frey/Osborne 2013 auf Deutschland (Application of the Frey/Osborne 2013 study to Germany). Regarding other countries, see also Arntz et al. 2016b on behalf of the OECD. The reason for the relatively high level in Germany is the comparatively low proportion of high-skilled and communicative and interactive activities. The study also highlights low ICT investment in Germany. 44 Autor 2015; Bessen 2016. 46 45 Nisic/Trübswetter 2012; Seibert 2007. 47 Challenges Challenges

---» What is key is the distinction They describe an adjustment process which is already taking place, but THE GERMAN LABOUR MARKET IN TRANSFORMATION that only activities and not entire which will probably pick up momentum. « II: LOW WAGES AND NON-STANDARD EMPLOYMENT occupations as such can be automated. Low-wage employment has risen strongly since the mid-1990s. On the one In addition, positive impacts on Several long-term forecasts have already been produced for the Federal hand, this enabled many people who had not previously been in emplyoment employment and adjustment effects for Ministry of Labour and Social Affairs regarding the development of the to gain a foothold in the labour market from the mid 2000s onwards. On the other companies and their staff are over- labour market. The current forecast for the period to 2030 calculates and hand, there has been an increase in the number of workers who are unable to live 47 looked. An analysis of individual assesses scenarios in order to explore to what extent the digital transfor- on their wages, in some cases despite working full-time. activities therefore does not allow mation can be shaped .46 In methodological terms, the study compares a The growth in employment since the mid-2000s was accompanied by an increase conclusions to be reached about “baseline scenario”, which assumes slow but steady digitalisation within non-standard employment. The official statistics define non-standard forms economy-wide impacts. « out particular priorities being set, with the alternative scenario of “accel- of employment as distinct from the standard employment relationship , includ- German Engineering Federation (VDMA) erated digitalisation”, in which policy-makers and the business community ing part-time employment of 20 hours per week or less, marginal employment, fixed-term employment and temporary agency work. take on a pioneering technological role and systematically align education and infrastructure policies with the digital transformation . Number of people in standard, non-standard and self -employment, in millions The key ÿnding is that, in the baseline scenario, the number of workers in 2030 will be around the same as in 2014, whereas in the accelerated 36 digitalisation scenario, signiÿcant positive impacts on growth and employ- 35 34 ment can be expected thanks to productivity gains. For the German labour 33 market, accelerated digitalisation would mean a continuation of struc- 32 # tural change. For example, an additional 750,000 jobs in total would be 8 lost in 27 sectors (e.g. retail, paper and printing, public administration), 7 but this would be more than offset by employment growth of a million 6 5 jobs in total in 13 sectors (e.g. IT services, research and development). 4 Overall, the labour force could grow by around a quarter of a million people 3 2 by 2030, with a corresponding fall in unemployment. 1 0 1991 1994 1997 2000 2003 2007 2010 2013 2015 Standard employment Fixed-term employment Non-standard employment Solo self-employment Total self-employment Marginal employment Part-time work up to 20 hrs. Temporary agency work

Based on the concept of the core labour force; figures from 2011 onwards are of limited comparability due to changes in how working status is recorded; there is some overlap between the groups of persons in non-standard employment.

Source: Federal Statistical Office, Microcensus

47 According to calculations by the Institute for Work, Skills and Training (IAQ), the low-wage threshold of 66 per cent of the median wage was 9.30 euros per hour in 2013. Hence, 24.4 per cent of all employees received low wages in 2013; see Kalina/ 48 46 Vogler-Ludwig et al. 2016. Weinkopf 2015. 49 Challenges Challenges

It is widely accepted that changes in the parameters for temporary agency The labour market forecast anticipates a significant rise in employment ---» Forecasts also provide indica- work and marginal employment have contributed to strong growth in the number in business services and the social sector, while a decline in employ- tions of what types of activity will be of people in these forms of employment. That said, non-standard employment ment is expected, among others, in public administration, the hospitality needed in future, namely knowledge has primarily been entered by people who were formerly economically inactive. Overall, there are more people in both standard employment relationships sector, and retail. In most sectors, accelerated digitalisation intensiÿes the work and “working with people”. and non-standard employment today than was the case ten years ago. The propor- trend of the baseline scenario. This is especially true with regard to IT and Working with people involves “inter- tion of the population aged between 15 and 64 in a standard employment relation- business services. In sectors providing equipment for Industry 4.0 , active” work, (personal) services, which ship has risen by five percentage points since 2004, while the proportion of primarily mechanical engineering, digitalisation has a positive impact on require both social and creative skills. those in non-standard employment has risen by three percentage points. « employment, while the overall trend is negative. The results are similar United Services Trade Union (ver.di) A structural shift is only visible from a more long-term perspective, if one looks for the relevant occupational categories. » at the respective shares of these employment relationships in the total economically active population: Here, the proportion of standard employment relation- Other studies on the impacts of digitalisation are not forecasting any ships fell from 85 to 76 per cent between 1984 and 2013.48 significant job losses either (« box “Further Studies on Employment Non-standard employment can act as a bridge to permanent, full-time employ- Impacts”). The forecasts remain vague, however, with regard to specific ment and can – if freely chosen – make it easier to balance work and family respon- groups. For example, it is impossible to offer a clear answer to the ques- sibilities. It is problematic when it becomes permanent or fails to provide an tion of what effects digitalisation will have on women’s employment adequate income for people to live on, and thus involves uncertainty and a greater risk of poverty for those affected.49 potential. On the one hand, women are comparatively less affected by impacts on employment in manufacturing, and they are disproportion- In addition to the rise in non-standard employment, self-employment has ately represented in occupations in the health, education and social also increased from around three million to over four million people since the sector, where the potential for automation is more limited, and demand 1990s. The figure soared from 2002 to 2012, in particular, driven mainly by an increase in self-employment without employees, which has been declining is rising strongly. On the other hand, other occupations with a high again since the beginning of 2012. Various factors have contributed to this rise: share of female employment are in areas where routine cognitive activ- the growing importance of the service sector and especially the creative sector, an ities can be automated relatively easily (e.g. administrative and office increase in outsourcing to reduce costs, a liberalisation of trade law, and a period activities, the banking and insurance sector). Other key factors which of very difÿcult labour market conditions which prompted labour-market support programmes to help unemployed individuals set up their own businesses. Since will determine how the digital transformation influences women’s 2012, with the labour market situation improving, there has once again been a career prospects are how occupations and the organisation of work decline in the number of new businesses being set up. change in the course of digitalisation, whether the status of personal services is upgraded, and the extent to which traditional role assignments thus become obsolete. New manufacturing processes also offer an opportunity to move beyond typical gender roles, for example if manufacturing work becomes more process-driven.50

48 See Arnold et al. 2016. 49 The Federal Ministry of Labour and Social Affairs has commissioned academic studies into the short- and long-term effects of various forms of non-standard employment for the Federal Government’s Fifth Report on Poverty and Wealth, which will be published in 2017; see RWI – Leibniz Institute for Economic Research 2016 and Lower Saxony Institute for Economic Research (NIW) 2016.

50 50 See Bultemeier/Marrs 2016. 51 Challenges Challenges

Labour Market Forecast for 2030: changes in employment in selected Besides the possibility of job losses, there is an intense debate about sectors, 2014–2030 (in 1,000s) whether far-reaching automation processes could result in employment and wage polarisation. Employment polarisation would occur if middle- Total -23 skilled employment were hit particularly hard by job losses while the 240 425 employment of low- and high-skilled individuals simultaneously Misc. business services 531 increased. This shift in demand would also lead to a polarisation of 335 Social sector, homes 306 wages. To date, however, there is no evidence of this in Germany, or of any Placement and hiring out 260 collapse in middle-skilled employment.51 of workers 244 218 Health sector 180 Employment and wage polarisation would have significant impacts ---» While great caution is needed Business, legal and 168 on society, namely a shrinking middle class and rising inequality overall. in interpreting forecasts, one important tax advice 317 Forecasts emphasise that action must be taken to avoid such a scenario question for the future will be how the Education and teaching 125 142 in future, particularly in the areas of safeguarding employment, securing transition to an Economy 4.0 can be Computers, electronic and 75 optical products 198 incomes, and skills development. The aim must be to give the entire labour prevented from leading to a further 71 IT services force new opportunities in the structural change which lies ahead and polarisation of the labour market 239 to enhance their ability to adapt (« Chapter 4.1). Upskilling at all levels with growing income inequality, or, 57 Research & development 119 plays a key role in this context.52 With regard to all of the forecasts, if this cannot be prevented entirely, 26 Financial services however, it should be borne in mind that while they can offer a certain how the effects can be cushioned in -19 8 amount of guidance they cannot provide any certainty and are based on social terms. Vehicle construction « 106 past experience. » Social Sciences Institute of the Evangelical Construction -13 Church in Germany -57

Telecommunications -19 -32

Postal and courier services -28 -60 Chemical and oil -29 products -71 Energy -30 -30 Publishing, ÿlm, TV -47 and radio -25 Retail -70 -168 Manufacture of -169 basic metals -216 Hotel, restaurant and -244 catering industry -259 Mechanical engineering -285 -134

Public administration -372 -427 -600 -400 -200 0 200 400 600 Baseline Accelerated scenario digitalisation scenario

51 See Dengler/Matthes 2015; Dustmann et al. 2009; Antonczyk et al. 2010. Source: Vogler-Ludwig et al. 2016 52 Vogler-Ludwig et al. 2016; Bonin et al. 2015; Arntz et al. 2016b.

52 53 Challenges Challenges

---» No one will be able to get by in FURTHER STUDIES ON EMPLOYMENT IMPACTS working life without digital literacy in Since the beginning of our consultation process, several studies have been future. At the same time, those with good published on the impacts of Industry 4.0 on employment in Germany. In skills will have more and better chances most cases, the conclusion has been that there will be significant shifts between for interesting, demanding and fulÿlling occupational groups, but no significant job losses. For example, the labour jobs. Rather than expecting to be able to market forecast produced by the Federal Institute for Vocational Education and Training (BIBB) and the Institute for Employment Research (IAB) found practi- work in the job they have trained for and cally no change in total employment in an “Industry 4.0 scenario” over the period in the same environment forever, people to 2030 compared to a baseline scenario (–60,000/–0.1 per cent).53 A survey must be willing to use their skills Žexibly carried out by the Cologne Institute for Economic Research (IW) shows human to regularly take on new challenges. « resources managers to expect that more staff will be needed in the medium term, especially for digitalised companies.54 The Boston Consulting Group (BCG) German Association for Information Technology, expects a net increase of 350,000 jobs by 2025,55 arguing that rising productivity Telecommunications and New Media (Bitkom) also leads to rising demand, both for new products and for skilled workers. This hypothesis is backed up by a study of regional employment impacts in Europe, which found that around 11 million new jobs were created in Europe between 1999 and 2010 as a result of technological change.56

Further hints are provided by the views of workers themselves. In a survey, four out of ÿve respondents stated that the technological equipment used in their job has changed over the past five years. Yet (only) 13 per cent of respondents 2.2 DIGITAL PLATFORMS: NEW are afraid that their own job will be performed by a machine in the next ten years.57 This, incidentally, matches closely the 12 per cent whose activities are highly susceptible to automation, according to the analysis applying the Frey/ MARKETS AND NEW FORMS OF WORK Osborne study to Germany. Another analysis finds that 15 per cent of workers face high risks in this regard.58 Although these figures do not mean exactly the same thing and their similarity may be a coincidence, they do offer a ballpark We are currently witnessing how the basic digital innovations of figure of sorts. And it is indeed a substantial figure – around one-seventh to one-eighth of all workers – if a long way from the 47 per cent suggested by the r ecent years – smartphones, mobile internet, cloud computing – are original Frey/Osborne study. being combined and turned into one new business model after another (« Chapter 1.1). For many people, these technologies are already part All of the forecasts emphasise that the digital transformation will increase the of everyday life. They use search machines, upload their own videos to dynamism in the labour market. The BIBB-IAB forecast anticipates a significant decline in manufacturing jobs and increases in IT and science. The BCG study platforms, listen to music from the cloud and buy things online. predicts almost a million new jobs in IT and data analysis and more than 600,000 fewer workers in manufacturing occupations; the Labour Market Forecast The term “platforms” is used as a general label for these new busi- ---» Already today many self- for 2030 offers similar figures. For companies, this means that digitalisation ness models, which act in – sometimes global – multi-sided markets. employed individuals offer their will exacerbate rather than resolve skilled labour shortages. The new jobs will primarily be created in sectors where shortages already exist. « Such platforms act as an intermediary between groups of users within servic es online, and this is part of an overarching “ecosystem”. These groups can be providers and their entrepreneurial freedom. « c onsumers of mobility services, holiday homes or web development German Confederation of Small and services, for example. The following differentiation seems useful:59 » Medium Sized Enterprises (BVMW)

53 Federal Institute for Vocational Education and Training (BIBB) / Institute for Employment Research (IAB) 2015. 54 Hammermann/Stettes 2015. 55 Boston Consulting Group (BCG) 2015. 56 Gregory et al. 2015. 57 Federal Ministry of Labour and Social Affairs (BMAS) 2016a. 58 Dengler/Matthes 2015.

54 59 Similar distinctions are found in, for example, Leimeister et al. 2016a. 55 Challenges Challenges

• Social communication platforms (such as Facebook, Xing, or Twit- These types of platforms are very rapidly transforming markets and ter), which are intermediaries for personal information, such as mes- market structures. They have a high growth potential due to the very sages, photos, and audio and video recordings, and which facilitate low marginal costs of an additional user of digital goods and services communication between users. (scale effects) as well as the increase in their attractiveness for other users with every additional user (network effects). However, this • Digital marketplaces (such as eBay, MyHammer or Kleiderkreisel), growth in users is not necessarily mirrored by an increase in the number which offer a virtual location for providers and consumers to find each of people directly employed by the company which runs the platform. other, without the platform operators intervening directly in the transactions. This category also includes non-commercial sharing plat- Platforms for on-demand services and crowdwork do not usually ---» The software company Intuit forms, in the narrower sense of the word, which facilitate collective use see themselves as employers, but rather as pure intermediaries which predicts that freelancers will account for of goods or infrastructures. facilitate market transactions, and as technology providers which lower around 40% of the US labour market users’ transaction costs . It is therefore widely expected that the platform in 2020. The share will not be as high in ---» The spectrum stretches from • Intermediary platforms (such as Uber, Helpling or Airbnb), which economy will lead to an increase in self-employment, especially solo Germany, but nor will we escape the the “after-hours” crowdworker, who intervene in the interaction between market participants to varying de- self-employed persons , who can offer their services and products general trend. All stakeholders must performs small digital jobs after grees, for example by setting rules on prices and the specifics of the simply and inexpensively via platforms.60 While there have been very therefore take this trend into account finishing work for the day, to people products or services being traded. Thus, they are not pure intermediar- dynamic developments in this area in the United States in recent years, and develop resilient, flexible and open offering comprehensive services – often ies. This category includes, in particular, service platforms in the this has not been the case in the German labour market so far. » models for the organisation of work in the creative sector – to shifting “on-demand economy”, with services usually being carried out on-site. which support solo self-employed indi- groups which carry out complex tasks At the moment, it is difficult to say how important digital platforms viduals even during economic crises. « with decentralised skills. « • Crowdworking platforms (such as Upwork or Amazon Mechanical are for value creation and employment in Germany, as the necessary Alliance of German Designers (AGD) German Association for Turk), which function as intermediaries for clearly defined packages of data is not available. Figures for secondary activities or solo self- Social Security Research and Policy (GVG) digital work, often based on open requests. « employment based on representative surveys do not indicate a rise in self-employed activities in Germany so far. Nor can the information provided by individual platform operators be combined to produce r eliable data. Types of digital platforms

SOCIAL DIGITAL INTERMEDIARY CROWDWORKING COMMUNICATION MARKETPLACES PLATFORMS PLATFORMS PLATFORMS Intermediaries for the Intermediaries for Intermediaries Intermediaries for exchange of products and services which intervene for workers, contacts and (personal) services which do not in transactions, usually for information, as well as intervene in transactions, especially on-demand IT-related services communication between as well as “sharing“ in the services users narrower sense

e.g. Xing or Facebook e.g. MyHammer or e.g. Uber, Helpling or e.g. UpWork or Amazon Kleiderkreisel Airbnb Mechanical Turk

ACCEPTANCE AND PREVALENCE TO DATE

Source: Federal Ministry of Labour and Social Affairs 60 Most platforms stipulate in their conditions of use that the registered service providers are self-employed (independent contractors). The issue of “misclassification” is being hotly debated 56 in the United States. See Schmidt 2016. 57 Challenges Challenges

---» Ideally, there should be a more When it comes to the digitalization of the world of work, crowdwork Yet there is not just one form of crowdwork – the spectrum ranges ---» Platform work (crowdwork) has nuanced analysis of the transformation is one of the most hotly debated topics. The impacts for workers are from clickworkers who carry out simple tasks for a few cents, to demand- massive implications for industrial of work by sectors, occupations or fields quite different from those in the context of Industry 4.0 . Tasks are ing and well-paid activities, such as in IT development or testing.62 The relations, the social partnership, co- of work. An industrial worker who has outsourced to a large number of people (the “crowd”) by posting more granular activities and work packages are, the more likely they are to determination, workers’ rights, pay and to get used to having robots as r equests online. Registered crowdworkers then carry out these tasks. be outsourced and – provided that they can be digitalised – “crowdworking conditions, and the social “colleagues” on the shop floor is affected There are competition-based models, where only a single solution is sourced”. In some large companies, internal crowdworking takes place. security systems (...). Crowdworking as by the transformation of the world of accepted from all those submitted, and collaborative models, where In this case, individual branches, teams or workers compete against a form of work is poorly paid in many work in a different way to a freelance tasks are carried out jointly or via a division of labour.61 Views on the each other. » areas today, usually well below the software programmer who increasingly pay and working conditions involved often differ very widely. In cases minimum wage, with no social protec- finds that relevant work is being allo- where crowdworkers act as self-employed workers, the situation has A representative survey of companies in the information industry has tion. Crowdworkers do not receive sick cated via crowdworking platforms. « both advantages and disadvantages: a high level of self-determination, shown that three per cent of companies in this sector are currently pay, do not have compulsory social Federal Association of but at the same time often a high degree of economic uncertainty making use of crowdworking , in the sense of crowdsourcing. The level insurance coverage and have no rights Human Resources Managers (BPM) r egarding employment and income. «« of use has barely changed in comparison with 2014. As work in the infor- to be involved in decision-making. « mation industry is comparatively well-suited to being divided up and German Trade Union Confederation (DGB) ---» Crowdworking and click- parcelled out online, the level of crowdworking in other sectors is working may be of interest for school- likely to be even lower.63 children or students who want to earn some pocket money on the side, and for In the debate on the effects of digital platforms, key players in the entrepreneurs who want to gain know- business community advance the view that platform monopolies cannot ledge at many people’s expense and be avoided.64 In fact, they argue, monopolies are desirable both in business ---» It is important to recognise the earn money by taking this approach. terms and for society. Banning monopolies would mean preventing techno- opportunities offered by these new In my opinion, you can’t support a logical progress. They regard “winner takes all” as the principle for success ways of organising work. They lower family with this kind of work. « in the digital economy, where avoiding “perfect competition” – at least barriers to entry, and SMEs in rural re- 7 May 2015 via Facebook 61 See, for example, Leimeister/Zogaj 2013; Benner 2014. for some time – increases the benefits for customers. gions which find it difficult to recruit and retain skilled workers can particu- On the other side of the debate, the term “platform capitalism” has larly benefit from these approaches. « gained wide currency.65 It is argued that a new form of capitalism is Association of German Chambers of Commerce emerging in which the major platform operators are setting the rules and Industry (DIHK) and undermining existing standards of protection and worker participation rights. Those who hold this view argue that digital platforms are exploiting their market power in an unacceptable manner. Forms of social coexistence which used to be organised differently, for example with neighbours and friends helping each other, are being subjected to market mechanisms, they claim, and digital platforms are commercialising the private sphere.

62 See Leimeister et al. 2016b. 63 The survey was carried out in the third quarter of 2016. It showed that only 1.2 per cent of manufacturing companies use crowdworking; Ohnemus 2016. 64 Thiel 2014, for example. 58 65 Lobo 2014, for example 59 Challenges Challenges

A third position emphasises the possibility of a more sustainable, soli- Platforms offer many benefits for customers. But they also offer ---» Not only does crowdworking not darity-based and democratic economic order.66 Proponents of this view self-employed workers, as suppliers or contractors, simple access to lead to standard employment relation- argue that the possibility of greater sharing and joint use of resources markets and in some cases niche markets, also known as the “long ships with compulsory social insurance means that ownership is losing signiÿcance, the sharp distinction between tail”.68 There is also talk of a new movement of “makers”.69 These include coverage, it actually puts these employ- producers and consumers is becoming blurred, and innovative means of producers and traders who sell through these platforms, or app program- ment relationships at risk. As neither production are no longer reserved for large, financially strong companies. mers. On the other hand, platforms for on-demand services and crowd- statutory protection under labour law work can result in standard employment being replaced by insecure nor industry-specific, collective agree- Challenges and tensions employment. In the United States, where this trend is further advanced, ment, or statutory minimum wage ---» The debate on the future of the Regarding digital platforms, one area of tension concerns the network a discussion is taking place about a “gig economy” in which employ- regulations apply to crowdworkers, working world often makes solo effects described above: the more users a platform has, the more rapid- ment takes the form of short “gigs”, and the platforms’ terms and condi- they are engaged in a direct underbid- self-employed individuals seem in need ly it becomes a standard, as rising demand leads directly to an improve- tions and rating systems leave workers little freedom, even though they ding war with standard business owners of protection. But that is more the ment in service and so attracts further customers. While this means that are formally self-employed.70 Due to fluctuating levels of work and a and those employed by them. « exception than the rule. Solo self- the platform becomes more useful for the providers and consumers using high level of social insecurity, those providing services are at high risk German Confederation of Skilled Crafts (ZDH) employed individuals are often success- it, it also means that there are significant barriers to entry for compet- in the event of accidents, illness and unemployment, as well as in old ful skilled workers and leaders who, as ing platforms.67 This is due to the fact that the centralisation of previ- age and in the event that they require long-term care. In addition, wage ---» Global mobility of labour and IT experts or interim managers, do not ously decentralised marketplaces promotes the development of dominant and salary employees have (protective) rights which do not apply to the outsourcing of projects in small need protection, but rather the freedom market positions. self-employed persons. » and micro packages to (solo) self- to ply their trade. « employed workers could undermine German Confederation of Small and Medium Sized Another key dilemma for providers of services for which digital plat- Compared with wage and salary employment, platforms most likely minimum wages. « Enterprises (BVMW) forms act as intermediaries is the fact that the increase in autonomy is result in a transfer of risk from companies to self-employed suppliers. Bundesagentur für Arbeit accompanied by an increase in uncertainty and dependence. As plat- That said, highly specialised and well-paid experts, for example in the ---» It is important to recognise the forms lower the transaction costs between market participants, they field of programming and design, have a different level of bargaining ---» It must be determined whether opportunities offered by these new make it easier for individuals to become self-employed. This opens up power than people offering to perform less skilled work. » fair social standards can be established ways of organising work. They lower new employment and income possibilities for people who want to work in the field of internet-based work « barriers to entry, and SMEs in rural more autonomously or who have previously been unable to participate in At present, it is impossible to foresee to what extent digital platforms Conference of the Labour and Social Affairs Ministers of the Länder regions which find it difficult to recruit the labour market. The operators of digital platforms emphasise that will replace work with compulsory social insurance coverage with new, and retain skilled workers can particu- many of their service providers are motivated to work on the platform insecure forms of employment. It will depend above all on whether larly benefit from these approaches. « because it offers greater scope for entrepreneurial decision-making and platforms engage in unfair competition with regulated services by system- ---» New digital forms of work and Association of German a better balance between work and personal commitments. « atically circumventing applicable quality standards and rules governing contracts are developing in the labour Chambers of Commerce and Industry (DIHK) the protection of workers and consumers, or even liabilities for tax and market. These fall outside the scope of social security contributions. The key question is to what extent plat- the labour market institutions which forms are exploiting legal grey areas regarding the status of workers in were, after all, originally created to order to cut costs and thereby gain a competitive advantage over exist- o ffset the imbalance of power in the ing companies. The need for action resulting from this is examined in market, as individuals would other- greater detail in Chapters 4.3 and 4.7. » wise be at its mercy if contracts were negotiated individually. « Bremen Chamber of Labour

66 Rifkin 2014, for example. 67 The Green Paper on Digital Platforms published by the Federal Ministry for Economic Affairs 68 Anderson 2007. and Energy (BMWi) (2016) discusses how a balance can be found between the necessary 69 Anderson 2013. 60 parameters. 70 Slee 2016; Hill 2015. 61 Challenges Challenges

---» The social market economy However, new and innovative business models which are currently A lot of new business models are based on people voluntarily provid- ---» Following the internet’s revo- only produces optimal results if the emerging should not be stalled by premature regulation without a ing their personal data when using online digital services, for example lution in interpersonal communication, rules of the game are the same for all proper assessment of their development potential and effects. Digital a navigation system, a health app or a discount card, or when visiting we are currently seeing another leap: competitors. Otherwise, there is a danger platforms can produce important economic and social benefits.71 The e-commerce, communication or work platforms.74 It is not just people to an Internet of Things. Over 50 billion of competition which rewards social crucial question is what those platform-based business models could themselves who provide their data, but increasingly also the items they objects (machines, systems, robots, dumping rather than innovation. « look like – whether commercial or, for example, cooperative-based – own: data can be collected and transmitted not only by smartphones or building systems, etc.) are being given Social Sciences Institute of the which are compatible with the principles of the social market economy fitness wristbands, but also by cars, heating systems or electric house- IP addresses, making them digitally Evangelical Church in Germany (« Chapter 4.3). hold appliances. » accessible and connectable. (...) At the same time, huge quantities of Commercial Big Data applications seek both to identify an individual’s data are being generated (Big Data), preferences and to ensure that planning takes place on the basis of the analysis of which can offer both 2.3 BIG DATA: more reliable and the broadest possible data: in connection with the opportunities and potential risks. « organisation of mass communication, for example, or the management Bremen Chamber of Labour THE RAW MATERIAL OF of complex technical processes in industrial production, the energy THE DIGITAL ECONOMY sector or transportation. The more the economy and public administration are digitalised, the ---» Health-related data must be more data that can be related directly to employees is collected and securely protected. New technical A heartbeat registered by an ECG, a whisper over the telephone, a stored. The whole spectrum of human resources management – from developments cannot be stopped, which swipe across a smartphone, an item scanned at the supermarket check- the application process, to time and attendance recordkeeping, to perfor- makes it all the more important to out: every movement, touch, sound and image which is recorded by a mance evaluation and payroll – is administered digitally in most organi- avoid using products which are not sensor or camera generates machine-readable data which can be sations. People who work with digital applications constantly produce data fully mature and to require extensive stored, analysed, disseminated and even sold. The principle is not new. which enables almost all behaviour at work to be observed, recorded or tests before products are brought to What is new, however, is the sheer volume of data available today due reconstructed. In the case of ofÿce jobs, it is possible – at least in theory – market. In this context, the self- to constant improvements in technical collection and storage possibil- to fully document and analyse every keystroke, every save or deletion, governing professional organisations, ities, as well as the “intelligence” and speed of data analysis.72 Big Data every online search, and all communication, for example by email. » which have a great deal of expert is a gigantic and rapidly growing volume of unstructured mass data knowledge, must urgently be involved produced by numerous decentralised sources. Data mining, i.e. the use As digital applications become more widespread in industrial processes, in developments at an early stage. of powerful computers and suitably programmed algorithms to carry commerce and logistics, more data is being produced in these areas too. “Health” apps and wearables also out a targeted search for useable information in the mass of raw data, RFID technology allows employees’ location on the site to be pinpointed require standardised regulation. « can “see” connections between different datasets and compare them – and their identity to be determined via their company ID cards, chips Federal Association of Liberal Professions (BFB) even in real time – making it possible to identify previously unknown sewn into their workwear or suitably equipped tools. GPS can be used patterns. In the case of personal data, the analysis can help to identify to locate external workers, for example in logistics, at any time. Mobile individuals or groups of people who fit certain criteria or behave in a devices provided by the company allow all user activities to be recorded. certain way, in order to draw conclusions regarding their future behav- Data glasses, data gloves and smart tools register every step in the work iour: the likelihood that they will buy products or services they are of- process. Machines check that work – maintenance work, for example – is fered, make certain decisions or take action in defined situations.73 » performed correctly.

71 Mandel 2016. 72 Markl et al. 2013. 62 73 PricewaterhouseCoopers (PwC) 2013. 74 Lanier 2014; Morozov 2013. 63 Challenges Challenges

---» The Green Paper recognises the While much of this personal data is simply a by-product generated Challenges and tensions ---» The automation of goods flows challenges for employee data while carrying out work, there are increasingly also applications which Like all technical progress, digitalisation has both advantages and with the help of RFID (Radio-Frequency protection against the background of can only function properly if they can access a personal user profile. disadvantages. This is also reflected by the debate on Big Data : on the Identiÿcation) and MEMS (Microelectro- Big Data. From our perspective, too, Such applications can be used to support people, for example in the one hand, it offers significant benefits for companies, public adminis- mechanical Systems) will create trans- the danger of data misuse is higher in case of digital assistance systems which can adapt to the needs of trations, the health system and society as a whole. On the other hand, parency in material flows along the the digital world of work. Employee people with disabilities or draw attention to poor posture, or location new risks are emerging, linked to ethical and legal questions as well as entire value flow in real time. Workers data protection must therefore – and tracking systems which help users to avoid unnecessary travel time on challenges to data security and protection.75 These risks fuel old fears will no longer need to carry out time- especially in the course of interna- a company’s site or in traffic. of total surveillance and a loss of privacy and freedom. »» consuming checks and tracking tasks. tionalisation – be rigorously reviewed Tools and systems will know their and enhanced. (...) The protection of Big Data is based on models and algorithms which analyse past optimal life via systematic analysis, privacy rights and informational data, identify connections and use them to make predictions. Such paving the way for predictive mainte- privacy remain high priorities even complex models are prone to error; for example, they can suggest false nance. The use of the means of produc- in the digital world of work. « connections, interpret variables incorrectly or imply clarity where none tion and employees’ workflows will Rail and Transport Union (EVG) exists. There is also a danger that the results can be misinterpreted. take place with maximum efficiency. « Risks arise as well where people and social relationships become the Robert Bosch GmbH subject of analysis, ratings and forecasting: firstly, people can be manipulated more easily when their preferences are known and their behaviour can be predicted, and, secondly, there can be feedback effects once people begin to adjust their behaviour in response to analysis ---» I would like to see more educa- tools, for example to receive the best possible ratings. tion on the subject of data protection! After all, it’s ultimately about our free- Data security is becoming a key problem for companies and society. dom and our right to privacy, and surely While in traditional data processing, customer data was held by banks, that concerns us all. « insurance companies, public administrations or companies in databases 11 Mar. 2016 via arbeitenviernull.de hosted separately on local servers, mass data today is generated in large volumes via internet-based communication and stored in clouds. This makes it easier to input data from the network, merge data from different sources and access it from different locations. At the same time, however, data security requirements are rising in order to effectively counter the dangers of unauthorised access and data misuse. Many companies have to invest in expensive network security architectures in order to protect their company secrets, their expertise and customer and employee data from industrial espionage, attacks by hackers or sabotage. The state also needs to take steps in this context: the greater or more central

64 75 Schirrmacher 2015; Kucklick 2014; Hofstetter 2016; Welzer 2016. 65 Challenges Challenges

---» Digitalisation is boosting both electronic control of civilian or military infrastructure becomes possible, In Europe, by contrast, there is a broad consensus that trust in the the quantity of data being collected the more vulnerable society becomes. Cyber-attacks on information infra- security and protection of personal data is a fundamental prerequisite and processed (“Big Data”) and its structures in Germany and abroad have become more common, complex for a peaceful and successful digital transformation. An important ÿrst step quality (“Smart Data”). Such huge and professional in recent years.76 » has already been taken: in April 2016, the European Parliament and the quantities of data must be organised Council of the European Union adopted the European General Data Pro- and managed, on the one hand, Citizens have their own responsibility in this context. On the one hand, tection Regulation , which creates an equivalent level of legal protection while on the other hand security they must feel reassured that services they use online are secure; but for all people in the EU regarding the collection and processing of person- issues are becoming more relevant. « on the other hand, they also have to take responsibility for deciding who al data. This makes it easier to deal with data and data protection in the Gesamtmetall – Federation of German to trust, which applications to use, and what data to provide. The fact European single market, which had previously been complicated by a Employers’ Associations in the Metal and that people have limited choice in these matters within a company con- patchwork of 28 national data protection laws (« Chapter 4.5). Electrical Engineering Industries text makes employee data protection an especially sensitive subject. ---» Increasing digitalisation is f orcing many SMEs in the liberal The fear of total surveillance and loss of privacy is deeply rooted in pr ofessions to draw on the expertise of Germany, partly as a result of historical or personal experiences of total- 2.4 INDUSTRY 4.0 AND external IT service providers instead of itarian states. In the era of Big Data , very extensive monitoring is pos- having in-house staff for this. The sible. State regulation of data protection is therefore needed on the THE HUMAN-MACHINE r esulting possibility for third parties to basis of an intensive public debate about what should be permitted. learn confidential information This regulation must clearly specify the limits of what may be moni- INTERACTION entrusted to a member of the liberal tored, and by whom. At the same time, however, the advantages of Big professions by clients or patients offers Data should be realized and business models which are based on the a high potential for conflict. « analysis of Big Data should not be made impossible in Germany. The use of pulleys in early antiquity or the Babylonians’ use of pumps Federal Association of Liberal Professions (BFB) There is a tension between data protection and economic interests, to irrigate fields can be regarded as early examples of human-machine which might be partly resolved to the degree that a higher level of data interaction. However, the way in which people and machines interact protection becomes a competitive advantage. with each other has undergone repeated changes ever since. Neologisms such as “Industry 4.0” or “cyber-physical systems” describe the most Silicon Valley’s protagonists, whose companies are home to a great recent paradigms in industrial production (« Chapter 1.1). At the same deal of the data collected worldwide, often do little to allay people’s time, they encapsulate a qualitative leap forward in the collaboration fears. The “totalitarian tendencies”77 of Silicon Valley are not inherent between humans and machines. The digital interconnectedness of all in the technology; instead, many of the business founders based there workers, tools and workpieces in the production process and across pursue ideological as well as economic aims78 and have a vision of a new company boundaries is generating an “Internet of Things and People”. “post-privacy” era.79 Highly developed sensors make it possible for people and robots to work together in ever closer proximity, as machines are able to register their users’ behaviour with ever greater precision, thanks to technologies ---» Technology must make allowing better speech and image recognition, emotion detection, and people’s lives easier. « the registration of eye movements and gestures. » Social Organisation Germany (SoVD)

76 Federal Ministry of the Interior (BMI) 2011; Federal Office for Information Security (BSI) 2015. 77 Lanier 2014; 2015. 78 Keese 2014; Siebenhaar 2016. 66 79 Heller 2011. 67 Challenges Challenges

---» Human-robot collaboration Human-machine interaction is taking on a new dimension due to devel- In the service sector, too, a wide range of possible uses are opening up: makes it possible to optimally combine opments in the field of artificial intelligence (AI). Self-learning algo- for example, new high-performance speech recognition and text process- humans’ cognitive superiority and rithms (machine learning) and the parallel analysis of vast quantities ing applications are now allowing simultaneous spoken translation, the flexibility with robots’ strength, of information (« Chapter 2.3) are enabling AI applications to adapt to automated production of complex standard texts and simple corre- endurance and reliability. Humans will people in line with the situation at hand, and to carry out a large number spondence, or the analysis of large volumes of text for legal purposes. always be at the heart of this process – of complex tasks in close collaboration with them. Although practical In medicine, intelligent image recognition software can vastly improve no machine in the world can come implementation has not yet been achieved in some areas, there are the diagnosis of many diseases and boost doctors’ capabilities. In the close to human flexibility. This will signs that this has significant potential to transform everyday working long-term care sector, interactive systems are being trialled which are make it all the more important to life, both in industry and in the service sector, where knowledge-intensive designed to enhance the mental and emotional well-being of older and combine human beings and technology occupations will be particularly affected. elderly people. In short: whether in industrial, service or knowledge in an intelligent manner. « work – digitalisation is transforming the entire socio-technical system Daimler AG In industrial manufacturing, a new generation of robots is emerging of people, process and technology (« diagram). with progressive advances in AI. While in recent decades robots were primarily used to automate simple production steps, the latest indus- Transformation of the socio-technical system as a trial robots are now also capable, thanks to AI-based high-performance consequence of digitalisation sensors, of taking on fine-motor tasks and interacting directly with their human co-workers. These “cobots” (short for “collaborative robots”)

perceive their surroundings in diverse ways, paving the way for safe PEOPLE physical human-machine collaboration. The previous spatial separation of people and robots is becoming irrelevant; the machines are leaving the “cage”. Cobots are also easier to programme than their predecessors Assignment of functions and are often equipped with self-optimising algorithms , enabling them New delineation of on the basis of tasks and roles to learn from their human colleagues. « situational and speciÿc strengths

TECHNOLOGY PROCESS

Connected decentralised processes and integration of functions in real time

Source: Federal Ministry of Labour and Social Affairs, based on Hirsch-Kreinsen 2016.

68 69 Challenges Challenges

---» The German social insurance At the intersection of people and technology, functions will be assigned Challenges and tensions system is already working with in new ways on the basis of situational and specific strengths. At the However, interacting in and with complex and increasingly autonomous data-processing systems which intersection of process and technology, hierarchically separated sub- systems also poses challenges. Several areas of tension can be identified: generate a result without human processes which have previously taken place in sequence will be replaced intervention. These workflow solutions by integrated, simultaneous and decentralised processes. And at the Firstly, there is a tension between upskilling and deskilling. The spe- ---» Here, digitalisation means relieve staff of routine activities « intersection of people and process, the question of how tasks are deline- cific design of human-machine interaction can “enrich” activities for automation, standardisation, more Social Insurance System Trade Union – ated and roles assigned arises anew. The transformation of human- workers by making them more complex and introducing a greater level monotony, more monitoring of results, Women’s Representation machine interaction thus offers new opportunities to shape work and of responsibility, with the machine providing assistance in dealing with but above all the destruction of “old” production processes, relieve workers of routine activities, develop the new range of tasks. However, it can also lead to once complex activ- jobs, with a few new ones for less ---» Work 4.0 can be a realistic workers’ skills and, not least, make it easier to achieve a good work- ities being simpliÿed and completely standardised so that they only require money . Is that okay? « opportunity to relieve workers of life balance.80 « a low level of expertise and experience, for example if the worker receives 4 May 2015 via arbeitenviernull.de physically demanding and dangerous an instruction for each work step or merely responds to set signals, with tasks. This is particularly interesting Shaping human-machine interaction in an appropriate way in which many of his or her skills going unused. » in a phase of demographic change older workers can make an important contribution to securing Germany’s when the average age of workforces is supply of skilled labour. Non-ergonomic jobs can be replaced and people Both scenarios can result in new risks of unhealthy psychological and ---» In many areas, digitalisation rising and businesses are increasingly can be relieved of the burden of carrying out tasks which are physically physical strain, for example if the work environment is largely automated, also leads to work processes being required to create appropriate jobs demanding, involve difficult motor activities or are psychologically leaving only monotonous leftover activities to be carried out by people. greatly simplified, which can result in for older workers. « stressful. This can prevent unhealthy physical and psychological strain. « Alternatively, working in complex, integrated and autonomous systems highly monotonous (leftover) work. Bremen Chamber of Labour could lead to a high level of work intensification and a far-reaching All that is left are activities which This also opens up new possibilities for participation in work, as assis- breakdown of the boundaries around work , with the risk of new psy- machines are mechanically unable ---» Digitalisation offers those who tance systems can help to compensate for physical or sensory impair- chological strain.81 » to perform (as yet). This opens up are currently not benefiting from the ments. Older workers can work for longer and more healthily, and peo- additional employment possibilities good labour market situation the ple with disabilities can take on jobs which were hitherto closed to them. A second area of tension relates to the importance of experience. If for workers with very limited basic chance to access employment. For This boost to capabilities also applies in the cognitive field: intelligent the growing capabilities of autonomous systems increasingly relegate skills, but at the same time it also example, people with disabilities can, assistance systems can create greater scope for decision-making by humans to the role of overseeing automated processes, staff have little leads to the question of how this work with the appropriate continuing ensuring that useful and suitably presented information is available at chance to gain experience in the working process. The “irony of auto- can be organised in a way which is vocational education and training, all times. « mation” is that automation actually results in the person overseeing adapted to the worker in future. « gain entirely new job prospects, moving the process becoming less and less capable of solving problems in the German Retail Federation (HDE) away from sheltered workshops and Looking to the future, intelligent tutoring systems could facilitate automated system – problems which, while increasingly rare, continue towards the regular labour market. « a much higher level of learning in the working process. Tasks can be to occur. And yet it is precisely when something goes wrong that people The Young Entrepreneurs (BJU) designed and allocated in such a way as to take into account and sys- are needed who know from experience how to deal with problems in tematically support the individual physical and mental capabilities of autonomous systems via communication with the machines.82 The chal- ---» The workers in the factory of the person working with the autonomous system. Meanwhile, the degree lenge is therefore to ensure that systems based on artificial intelligence the future will be expected, more than to which work is tied to machine cycles is declining as greater flexibility do not devalue skilled workers’ necessary knowledge and experience.83 » ever before, to coordinate processes, is introduced and work processes become more integrated, while the manage communication and take possibilities of human-machine interaction independent of location autonomous decisions. « are increasing. This can make it easier to balance work and personal German Engineering Federation (VDMA) commitments. «

81 Pfeiffer 2015. 82 Ittermann et al. 2015. 70 80 Acatech 2016. 83 Apt et al. 2016; Windelband/Dwortschak 2015. 71 Challenges Challenges

---» In organisational terms, the Another area of tension is the need to weigh the possibilities for indi- The reality of Industry 4.0 and the Internet of Things will usher in ---» The digital workflow can question is how much space remains, as vidual support and behavioural monitoring against each other. Data a wave of implementation. For business reasons alone, the scenario of provide support by integrating work efficiency and automation increase, for which was initially generated for the purpose of process optimisation extensive automation is likely to be rare in practice. Key factors in ensuring processes and dealing with high- resilience in companies; what happens, can also be used to monitor performance or behaviour. The closer the that implementation is successful include the continuation of an intensive volume activities, but artificial intelli- in other words, if a highly automated integration between humans and machines in performing work, the debate in society and in the workplace about the aims of the use of digi- gence cannot replace the empathy system malfunctions and targeted more staff become locatable, and their performance and work behaviour tal technologies and intelligent machine systems, and a lively culture of humans supply. In an area as sensitive intervention is necessary to return the documentable (« Chapter 2.3). If robots are to respond to a worker’s participation and continuing vocational training which enables workers as social insurance, there is a human system to a safe operating status. « actions and, for example, move away to avoid injuries, this not only requires to put their experience and process knowledge to use in designing the life behind every ‘file’. And this person Institute of Industrial Engineering and suitable sensors but also data about the worker’s movements and location. arrangements for technology use, but also to assert their needs as users. » will continue in future to need a Ergonomics (IAW) at RWTH Aachen University Autonomous warehouses need to know at what intervals workers call up human being who can offer him or the next workpiece. “Smart” gloves and data glasses can only support her guidance and advice on social an unskilled warehouse worker effectively if certain data is available about security matters. « the employee and the work to be performed. Social Insurance System Trade Union – Women’s 2.5 FLEXIBLE WORKING Representation What will become reality in the world of tomorrow depends not only on technical feasibility and economic profitability, but also on how society TIME AND LOCATION: negotiates and shapes developments. Two scenarios are conceivable.84 In a highly technology-centric scenario with extensive automation of BEYOND PRESENTEEISM many work processes, the “human share” would be reduced to activities which cannot or should not be automated for technical, socio-economic or ethical reasons (e.g. activities in the field of long-term care). One Flexible work arrangements with regard to time and place do not only ---» Over the life course, a wide conceivable consequence would be highly polarised organisations with a affect collaboration in the workplace, they also have a strong impact on variety of events can require people to small number of workers carrying out simple tasks which would be mainly communities. They determine what windows are available for family, shift their work-life balance and can determined by others, and a group of highly skilled planners whose skills leisure, recreation, continuing vocational education and training, or mean that they desire or need flexi- would be significantly above the current level for skilled workers. volunteering. It is important to note that preferences and needs can bility, especially in terms of their change over the life course: people can have different working-time working time. « What is equally possible, and preferable from society’s perspective, is needs in periods when children, caring responsibilities or personal pro- Hans Böckler Foundation a human-centric scenario, in which people remain the managing and jects are taking up a great deal of their time, for example, and their needs decision-making authority and the repository of experience, while their will be different when approaching retirement as compared to other role in the working process is upgraded via smart tools and assistance periods in their working lives. » ---» In light of demographic change, systems . Looking to the future, the separation between management people must be able to organise their and execution could be eliminated and replaced by a loose network of working time flexibly when they are highly skilled workers taking action on an equal basis. This requires, not planning and starting a family. « least, an upgrading of skills in all business areas, however. Association of German Cities

72 84 Hirsch-Kreinsen 2014. 73 Challenges Challenges

---» Modern means of communica- The trend towards working time flexibility and decentralised work lo- Prevalence of evening, night and weekend work tion make flexible working arrange- cations is continuing in the context of digitalisation (« Chapter 1.1). ments possible, which allows working Broadband internet, network technologies and mobile devices mean 30% time to be organised in new ways. that tools and content can be accessed from anywhere, around the 25% This will make it easier to accommo- clock.85 Digitalisation can facilitate flexibility in both directions: sup- date the needs of organisations porting companies’ needs regarding the organisation of work, but also 20% and workers in designing flexible supporting workers’ needs and preferences.86 The possibility of working 15% working hours. « from home can also be extremely convenient for people with reduced Confederation of German mobility. What impact digitalisation will have in practice and what po- 10% Employers’ Associations (BDA) tential can be realised depends on the specific technical implementa- 5% tion, individual usage, and how it is incorporated in the workplace, in --- Work 4.0 fulfils workers’ desire legislation and collective agreements. The specific circumstances in in- 0% » 1992 2014 for greater working time sovereignty. dividual occupations and sectors also play a major role. To learn more This is positive from the employer’s about what issues are of particular importance to workers, companies Evening work Saturday work perspective, too. For example, greater as well as staff representation bodies are carrying out employee sur- Night work Sunday work flexibility has the advantage that work veys and feeding the results into the ongoing discussion about how to can be better carried out at short shape these developments. « notice, and travel time can be used Quelle: Statistisches Bundesamt/WZB 2016. more efficiently by working on a Changes in customer needs and value creation processes were an im- laptop. In addition, flexible working portant reason for greater flexibility in the recent past. Greater use of arrangements are beneficial in external (e.g. temporary agency work, contracts for work and services, retaining skilled workers and outsourcing) and internal (e.g. working time regulations) potential for Locational flexibility, with shifting places of work, is also standard ---» New flexibility compromise: recruiting new staff. « higher flexibility is increasing the demands placed on workers and con- for many workers, for example in the case of maintenance, servicing people already work flexibly. Nowadays, Federation of Chemical tractors in terms of time flexibility and mobility (« Chapter 2.6). One and installation work or sales work. Around one in five workers in both partners work. Not necessarily in Employers’ Associations (BAVC) in four workers works in the evening, while one in ten works at night. G ermany travel for work-related reasons, whether by changing their exchange for more time for personal The figures are similar for work on Saturdays (26 per cent) and Sundays place of residence for work, or in the form of long-distance commut- matters or more money. When will ---» In skilled crafts, despite (14 per cent).87 Compared to 1992, there has been a significant overall ing, business trips, travel to meet customers or travel to attend meet- companies give something back? « digitalisation, the worker’s presence increase in the proportion of workers who work in the evening, at night ings and trade fairs.88 » 22 Apr. 2015 via arbeitenviernull.de at the customer’s site or the location and on weekends (« chart). where the work is to be performed will, in practice, remain an essential part of our work. « German Confederation of Skilled Crafts (ZDH)

85 Two-thirds of all white-collar workers are at least occasionally reachable at home. Even among blue-collar workers, the equivalent figure is just under 50 per cent, and the level of reachability has increased for both groups in recent years. See Federal Ministry of Labour and Social Affairs (BMAS) 2015b. 86 Federal Ministry of Labour and Social Affairs (BMAS) 2015c. 87 Federal Statistical Office (Destatis)/Berlin Social Science Center (WZB) 2016, p. 137–138. According to the 2016 report published by the Federal Institute for Occupational Safety and Health on working time in Germany, working at the weekend on a regular basis is widespread 88 Regarding mobility for work, see Ruppenthal/Lück 2009; see also the 2007 Good Work Index today and affects 43 per cent of employees, with a roughly equal divide between workers who produced by the German Trade Union Confederation (DGB). Regarding the growth in business only work on Saturdays or who also regularly work on Sundays and public holidays (Federal travel, see the analyses of business trips produced by the Business Travel Association of Germany 74 Institute for Occupational Safety and Health (BAuA) 2016a, p. 41). (VDR); regarding trends in the posting of workers, see Hupfeld et al. 2013. 75 Challenges Challenges

---» Tomorrow’s workers will Besides technological changes, cultural and societal changes also their contractually agreed working time, and to not have to constantly ---» As long as employers basically autonomously and responsibly affect the issue of flexibility: people’s life plans have become more work more than contractually agreed. By contrast, over a third of part- insist on excessive punctuality and organise when, where and how to carry individual and diverse, traditional role conceptions are dissolving, and time workers would prefer to work longer hours. Women account for 84 per overtime, flexible working hours are a out their work in line with their own values and preferences regarding work have changed (« Chapter 1.4). cent of the part-time workers who would like to increase their hours.92 » utopia. #arbeitenviernull « interests and needs and the requirements Many workers would like to have more sovereignty to achieve a better 16 Mar. 2016 via Twitter of the type of work in question. « work-life balance. Many employers are already responding to workers’ Many workers are also dissatisfied with the scheduling of their work- Robert Bosch GmbH need for greater autonomy with regard to when and where to work, for ing time. Even a small shift in when working hours begin or end, or the example by individual working time models, long-term accounts , sabbat- choice of certain days, can determine whether a (full-time) position is ---» Many companies now have icals or homeworking options.89 « compatible with, for example, a day-care centre’s opening hours, the time flexible working time models or when a carer arrives, continuing training or volunteer work. According support workers in balancing demands Nonetheless, many workers’ wishes regarding the length and sched- to a survey carried out for the Federal Ministry of Labour and Social on their time in other ways, and this uling of their working time and homeworking remain unfulfilled. Affairs, 37 per cent of workers would like to change the scheduling of plays a key role in securing A ccording to the working time calculations published by the Institute their working time.93 This is in particular workers who are required to skilled labour. « for Employment Research (IAB), almost a billion hours of unpaid over- be reachable outside working hours, who work in the evenings, at night Association of German Chambers of Commerce time and around 800 million hours of paid overtime are currently or at the weekend, who have to be on call, who work shifts or have and Industry (DIHK) worked per year in Germany.90 In addition, holiday entitlement is not staggered work schedules, who are not allowed to take longer breaks, fully claimed: a study by the German Institute for Economic Research who are in fixed-term employment, or who do not have flexitime and/ (DIW) finds that in 2010 around 37 per cent of full-time employees did or a long-term account. ---» So far, relatively little use is not take the full amount of holiday time to which they were entitled in being made of models such as working the previous year. According to the study, around twelve per cent of the When it comes to the choice of working location, the preferences of time accounts, which enable workers total holiday entitlement was not taken.91 many workers currently remain unfulfilled. Germany is lagging behind to save up time that they can take off other European countries (especially Denmark, Sweden, the United in future, e.g. for a sabbatical or According to the Working Time Report Germany 2016 published by Kingdom and the Netherlands) when it comes to working from home.94 at times when they have family or the Federal Institute for Occupational Safety and Health (BAuA), full- Yet there is demand: almost 40 per cent of white-collar workers who cur- caring responsibilities. « time employees work 43.5 hours per week on average, almost five rently lack this option would like to work from home regularly or occa- German Confederation of Managers (DFK) hours more per week than contractually agreed. More than half of sionally, including a disproportionately high number of parents with them would like to reduce their working time – irrespective of whether children under the age of 14.95 Furthermore, working from home can or not there are children in their household. They wish both to reduce give people with disabilities new opportunities in the labour market. It can also open up new career prospects for people in lagging regions.

89 Working time accounts exist in 89 per cent of companies (survey of 1000 human resources managers; Randstad-ifo-flexindex, 2016) and employees are offered the option of working part- time in 81 per cent of cases (survey of 700 companies, Chamber of Commerce and Industry of the Stuttgart Region (IHK Region Stuttgart) 2015). According to a current survey of workers carried out for the Federal Ministry of Labour and Social Affairs, long-term accounts are now offered to four in ten workers. However, one in ten of those surveyed does not know whether an account of this kind is available to him or her, which points to an information deficit (Himmelsbach et al. 2016). A representative TNS survey of organisations concluded in 2010 that long-term accounts 92 Federal Institute for Occupational Safety and Health (BAuA) 2016a. The Federal Statistical Of- are used in just two per cent of organisations in Germany (Riedmann et al. 2011). Only just under fice concludes that fulfilling all wishes regarding working time would increase the total volume a third of German companies with more than 50 employees offer homeworking options; see of working time. In total, the untapped working potential in 2014 was equivalent to more than Federal Ministry of Labour and Social Affairs (BMAS) 2015b. half a million full-time positions; see Renger 2016. 90 For 2015, the Institute for Employment Research found that there were 940 million hours of 93 The vast majority (89 per cent) of respondents who expressed a desire to change the scheduling unpaid overtime and 764 million hours of paid overtime. This means that every employee worked of their working time also want to change the number of hours, although in most cases what is on average 19.7 paid and 24.3 unpaid hours of overtime during the year; Institute for Employ- desired is a reduction in the number of hours worked in practice. If one looks at all respondents, ment Research (IAB) 2016a. The Federal Statistical Office reports lower figures on the basis of a third would like to change both the scheduling and length of their working time, whereas the Microcensus. As the question on overtime in the Microcensus is optional, it is likely to under- merely around four per cent want to change the scheduling alone; Himmelsbach et al. 2016. report the true figures. 94 Brenke 2016. 76 91 Schnitzlein 2011. No more recent analysis is currently available. 95 Federal Ministry of Labour and Social Affairs (BMAS) 2015b. 77 Challenges Challenges

---» Always this fear that people Challenges and tensions Firstly, the ¡exibility needs of companies and workers are not identical. ---» It should be ensured that a would automatically work themselves to The trend towards ± exibility in working time and location, which is being Thus, a suitable balance must be struck. For companies, factors which balanc e is struck between time sover- death if working hours weren’t laid down. reinforced by digitalisation, offers opportunities for greater self-deter- play a major role – alongside employee satisfaction and positioning eignty and operational requirements. « #digitalisation mination in relation to work, new solutions for work-life balance, and a themselves as attractive employers – include labour and cost efficiency, Gesamtmetall – Federation of German Employers’ Associations in the Metal and Electrical Engineering #arbeitenviernull shift away from the “presence culture”. Alongside these positive aspects, the coordination effort required, quality of service, and staff availability. « Industries 31 Jan. 2016 via Twitter however, it is also becoming evident that working from home, trust- For workers, important advantages include greater time sovereignty , based working time and an expectation for workers to be reachable at all the ability to better balance work and family life, and a more ±exible and ---» A new flexibility compromise, times, are causing a “breakdown of the boundaries”96 of work. The partnership-based approach to sharing family commitments. A better i.e. the use of digital opportunities for ---» The requirements regarding lines betw een people’s working and personal lives, between work and work-life balance can also have a positive impact on health.99 » a self-determined work-life balance, flexibility, mobility, reachability leisure, between workplace and home become blurred. This can cause must focus on the workers and take and self-organisation make it essential stress and poses new challenges in terms of health and safety at work. « Alongside protection for workers, greater flexibility also plays a vital their interests into greater account. « to take a focused look at working role in balancing different needs. The Working Time Report Germany German Trade Union Confederation (DGB) time and occupational health. « Likewise, the use of flexibility options can lead not just to changes 2016 shows that, overall, more than one in seven employees experience Rail and Transport Union (EVG) and improvements in how people work, but also to an increase or inten- frequent changes to their working time due to operational require- ---» The new level of flexibility in sification in their work.97 It is also becoming evident that women and ments, while around one in four experience such changes occasionally, work and forms of work requires inno- men use self-managed working time differently, which can lead to an and that these ±exibility requirements have a negative impact on workers’ vative strategies to ensure the safety entrenchment of traditional roles.98 With regard to work location and the health and job satisfaction. More than one in five respondents work in an and health of those affected, even in equipment available for mobile working, the question is how, for example, environment where they are expected to be reachable at all times. Rising non-standard jobs, where the lines comparable standards of ergonomic protection can be ensured as for expectations on the part of employers and customers regarding workers’ between work and the personal sphere ---» Greater flexibility in terms of workstations at the traditional place of work. The way in which working availability can place particular pressure on those who have to combine are blurring (e.g. working on the move working time is desirable, but it is time is organised cannot be separated from pay and the organisation’s their employment with care work. According to the Working Time Report, or in the living room at home). « important to provide protection from “performance policy”. It must also be linked to a good corporate culture, it is not just those in senior positions who are expected to be reachable German Statutory Accident Insurance (DGUV) self-exploitation in this context. « responsible management and reasonable staffing estimates. The follow- during their leisure time. Often it is workers in lower occupations (es- 22 Apr. 2015 via ing challenges must be taken into account by employers and works pecially in the service sector) who are expected to be reachable outside ---» There is a risk that the new arbeitenviernull.de councils, the social partners and legislators, in this context: « working hours and are frequently contacted.100 This breakdown of forms of digital, round-the-clock boundaries can result in work-related strain – which can have many reachability will, rather than improv- causes – carrying over into leisure time, making it harder for users of ing the situation for women and ------» TThe increasingincrhe decouplingdeceasing ofooupling f flexible work arrangements to rest and recover. » people with family commitments, the placeplacthe ofoe workworkf fromfr om the actual result in increased strain. « ororganisationganisation poses a challenge in terms United Services Trade Union (ver.di) ooff the design oof workworkf locations outside the actual ororganisation.ganisation. «« RRobertobert Bosch GmbGmbHH

99 See, for example, Amstad et al. 2011. 96 The question of whether “breakdown of boundaries” is an appropriate term or too judgemen- 100 Workers are disproportionately likely to be expected to be reachable outside working hours in, tal is contentious. As the term is widely used in the discussion in the social sciences, it is also for example, agriculture, animal-related and forestry occupations (45%), non-medical health used in this publication; see, for example, Gottschall/Voß 2003; for criticism of the term, see occupations and medical technology (e.g. care for the elderly, wellness occupations, funeral Mayer-Ahuja/Wolf 2005. workers: 34%) and in safety, security and monitoring occupations (32%). 28 per cent of people 97 For example, those who work entirely or partly from home do more overtime than workers who in senior positions are frequently expected to be reachable; the figure is 19 per cent for people do not work from home; see Federal Ministry of Labour and Social Affairs (BMAS) 2015b. without management responsibility. See Federal Institute for Occupational Safety and Health 78 98 See, for example, Lott/Chung 2016. (BAuA) 2016a, p. 77, 82. 79 Challenges Challenges

---» It is important not to overlook Secondly, there are often widely varying expectations and needs with- And finally, operational needs can clash with societal preferences for ---» In addition, the interests of those areas where greater flexibility is in a workforce regarding the organisation of working time and location. fixed windows of shared free time which support a lively community SMEs must not be overlooked in the not an option. In production depart- On the one hand, there are groups of workers who see greater flexibility and civic engagement. The more mobile and flexible the world of work discussion about flexibility in working ments, for example, set times, on-site as an opportunity for greater self-determination in their work and would becomes, the more important collective agreements and work agree- time and location. In staffing, financial, work and shift schedules will continue therefore like more individual options. On the other hand, there are also ments become, together with a complementary statutory framework technical and organisational terms, to be necessary in future. « many workers who want clearly defined and reliable working hours and which continues to protect windows of shared free time (especially they can quickly reach their limits when Gesamtmetall – Federation of German Employers’ who do not want to take their work home with them. In addition, there Sundays and public holidays), as well as a corporate culture which enables it comes to implementing such models. Associations in the Metal and are groups of workers for whom flexibility options are either not feasible people to “switch off” and go offline. The question is thus how SMEs can be Electrical Engineering Industries or very limited. « supported appropriately. « Policy-makers can support small and medium-sized enterprises Association of German Chambers of Commerce ---» In our view, these expectations Thirdly, this can result in polarisation between groups of workers, (SMEs), in particular, in developing appropriate solutions in this context. and Industry (DIHK) [of greater autonomy in working time] even beyond the boundaries of an individual organisation, because the Large companies have experience and implementation-related knowledge should not be solved individually; they extent to which the conditions are in place for flexibility in working time which can serve as a reference and a starting point, but often this cannot ---» A new compromise is required can only be resolved cooperatively. It and location varies for different sectors, fields of activity and groups of be directly applied. SMEs have the advantage that they can more easily between employers’ interests and must be ensured that assertive workers workers. While in-demand skilled workers are in a position to enforce offer individual solutions for individual workers. In some cases, however, work ers’ needs... The primary aim must do not gain greater freedom at the their preference for control over their working time and location, many they first need to obtain information and concrete implementation- be to find solutions which align ope- expense of others in the workforce. « other workers or contractors work on-call, or are on fixed-term contracts related knowledge. In addition, smaller businesses often lack adequate rational requirements regarding reach- Industrial Mining, Chemical and to cover temporary gaps, or work in sectors where their options are actu- resources in their personnel departments to implement changes. » ability and availability with workers’ Energy Union (IG BCE) ally declining in the “round-the-clock economy”. « individual preferences. « In view of the challenges and tensions set out above, employers, Rail and Transport Union (EVG) ---» However, homeoffice and Fourthly, tensions can emerge between individual preferences and works councils, the social partners and the state should contribute to flexible hours must not be offered – collective regulations. A high level of identification with their work, a solutions which ensure a fair balance of interests. In this context, new ---» Greater flexibility must meet for the company’s benefit – only strong performance culture in an organisation or career ambitions can, technical possibilities must be used to facilitate an organisation of two separate sets of needs: those of the to “high performers”. « for example, lead workers to regard the statutory breaks and rest periods working time which takes into account both workers’ changed needs company, which has to work cost- Rail and Transport Union (EVG) established for their protection as a form of paternalism, and to choose and businesses’ rising flexibility requirements. In this way, new flexi- effectively, and those of the worker, to ignore them. « bility compromises can be negotiated on the basis of a culture which who must meet individual family promotes agreements. » c ommitments, for example. « ---» I don’t want my flexibility Fifthly, greater flexibility can, for many, also lead to marginalisation, Gesamtmetall – Federation of German and my own ability to decide for example if technical aids are not fully accessible for people with dis- Employers’ Associations in the Metal and Electrical Engineering Industries when and where I work to be limited abilities. Accessibility is therefore an important issue. Otherwise there by works agreements, health and would be a danger of digitalisation raising new obstacles for people safety laws, etc. « with disabilities. 22 Apr. 2015 via arbeitenviernull.de

80 81 Challenges Challenges

2.6 COMPANIES: ORGANISATIONAL STRUCTURES IN TRANSFORMA TION

BUSINESS CHARACTERISTICS IN FIGURES ---» Very often, it is not up to The previous sections have described the various processes which, as The most recent figures from the Federal Statistical Office’s Business Register employers whether they want to go part of the digital transformation, are changing the conditions for business show that Germany has around 3.63 million businesses. Almost 2.3 million are sole along with these developments or not. and work. Technological change, internationalisation, accelerated inno- traders, more than 450,000 have the legal form of a partnership (e.g. OHG, KG), Firstly, companies are coming under vation and product cycles, innovative services based on Big Data , and around 666,000 are corporations (e.g. GmbH, AG), while the rest have other pressure from competitors which are a new way of involving customers and dealing with customer wishes are legal forms. already embracing the digital trend shaking up value creation processes and posing entirely new require- 99 per cent of businesses are small and medium-sized enterprises (SMEs); and thus can work more quickly ments for the flexible organisation of how people work – both with they provide 60 per cent of all jobs. In turn, the vast majority of these busi- and cheaply; secondly, customers each other and with software and/or machines. Companies and organi- nesses are micro-enterprises (80 per cent of all businesses, 18 per cent of all also have clear expectations of sations are the place where all of these changes come together and workers); small enterprises make up 15 per cent of all businesses and 22 per cent of all workers, and medium-sized enterprises make up almost three per companies regarding rapid and where their effects on industrial relations are felt. « cent of all businesses and 19 per cent of all workers. Large enterprises account efficient processes. « for just 0.7 per cent of all businesses, but provide 40 per cent of all jobs.102 Bavarian Industry Association (VBW) The “traditional” organisational principle, that of large, vertically integrated, hierarchically organised companies which manufacture stand- In 2015, employees had co-determination at the workplace level under the Works Constitution Act (Betriebsverfassungsgesetz) in almost every tenth ard products in large quantities, organise manufacturing steps internally organisation in Germany with at least five workers. The larger the organisation, where possible, and secure a supply of skilled labour primarily through the more common it is for there to be a works council or staff council: the pro- the long-term retention and internal upskilling of their own staff, has portion is just five per cent for organisations with five to 50 workers, while 88 ---» Employees collaborate world- long since ceased to be as popular as it was in the heyday of the indus- per cent of organisations with more than 500 workers have a staff representation body. In total, 42 per cent of workers in organisations with five or more wide, but at the same time are trial era. Nonetheless, no one single new paradigm can be identified as workers have a works council. This share has declined by around ten percent- increasingly competing with each other having replaced it. age points since the start of the 1990s, which is primarily due to reductions in for work. Digital connectivity and the category of organisations with 51 to 500 workers.103 cloud infrastructures mean that work Over time, changes to a company’s organisation have been accompa- If the organisation of working conditions via a collective agreement (sectoral and services no longer have to be nied and driven forward by diverse management models such as “lean or company-level agreement) negotiated between employer representatives performed at the company’s facilities. production” or “lean management”, sociological analyses of the “end of and trade unions is also taken into consideration, the proportion of workers This is resulting in a high level of flexi- the division of labour”, but also by major changes in corporate govern- who are covered rises. However, 36 per cent of private-sector workers in western bility regarding where and when work ance – not least the trend towards financial investors having greater Germany and 49 per cent in eastern Germany are not covered by a collective agreement or represented by a works council. is performed. This is perhaps the most influence on corporate decisions.101 Regarding all of the above, it must important change in the world of be kept in mind that a company’s organisation must always – like workers’

work at present. « opportunities for influence and participation – vary depending on the Hans Böckler Foundation type of enterprise, the sector, and the size of the organisation (« box).

102 Federal Statistical Office figures for 2013. The Federal Statistical Office makes the following distinctions: micro-enterprises: up to 9 workers and up to 2 million euros in annual turnover; small enterprises: up to 49 workers and up to 10 million euros in annual turnover; medium-sized enterprises: up to 249 workers and up to 50 million euros in annual turnover; large enterprises: up to 249 workers or over 50 million euros in annual turnover. 82 101 Windolf 2005; Nölke 2014. 103 Ellguth/Kohaut 2016. 83 Challenges Challenges

Collective agreement and works council (WC) coverage, 2015*, At present, it is still unclear to what extent the digital transformation will ---» The biggest opportunities in in per cent continue to displace the integrated company and the workplace as the connection with the digitalisation of physical location for value creation, and to reinforce the trend towards value chains can be found in the Western Germany networked companies,105 which make the most of the possibilities of improvement of the flexibility and Percentage of workers of which: digitally and internationally connected, customer-focused value crea- efficiency of production processes and Private Manu- Con- Services sector facturing struction tion to provide “smart” or customised products and services with low- a more direct focus on the customer WC and sectoral agreement 27 46 10 22 er transaction costs . In sectors which mainly produce digitisable via customised products and services. WC and company agreement 7 9 4 6 goods and services – such as the media and publishing sector and the The changes in the world of work, WC and no agreement 9 12 2 7 music industry – the transformation which has already taken place especially with regard to skills develop- Sectoral agreement, no WC 20 10 57 24 since the end of the 1990s shows the fundamental transformative ment, greater Žexibility and leadership Company agreement, no WC 2 1 2 1 106 No agreement and no WC 36 23 25 40 potential of digitalisation. » philosophy, are an important aspect Total 100 100 100 100 of digitalisation. « Workers in companies 47 56 67 46 No one single paradigm exists in the digital economy either, even if Daimler AG with a sectoral agreement Workers in companies 42 67 16 35 many business models aim to achieve a dominant market position. with a works council While some platforms concentrate on their core business as an inter- ---» Customers’ preferences will mediary for services and seek to remain as lean as possible in organi- continue to change as a result of digi- Eastern Germany sational terms, companies such as Amazon are systematically expand- talisation. They are developing more Percentage of workers of which: ing their value chain towards content production and last mile logistics. individualised wishes regarding prod- Private Manu- Con- Services sector facturing struction In other words, digitalisation does not necessarily result in radical ucts and greater expectations regard- WC and sectoral agreement 14 15 9 15 new forms of organisation for companies in all cases. Yet it offers the ing the service provided by companies. WC and company agreement 11 16 6 11 potential to take familiar trends to a new level, especially in the ser- Companies – and thus their workers – WC and no agreement 8 20 1 7 vice sector. must respond to this, if they want to Sectoral agreement, no WC 15 5 49 19 » succeed in the market. Company agreement, no WC 2 1 1 3 « No agreement and no WC 49 43 34 45 The question is whether there will still be such a thing as a “standard Confederation of German Employers’ Associations Total 100 100 100 100 company” in future, and what this means for the standard employment (BDA Workers in companies 29 20 58 34 relationship . Will we have more virtual companies with a small core with a sectoral agreement Workers in companies 33 51 17 33 and a flexible periphery? Taking the model of the traditional company ---» Over 70% of employment is now with a works council and the standard employment relationship as a starting point, three in the service sector. The focus must be

*Basis: private-sector companies with 5 or more workers, excluding agriculture and axes of change can be identified in how companies and work are on growing, forward-looking sectors not-for-profit organisations. organised (« figure on p. 86). The types of change along the “greater and, accordingly, it is important not to external flexibility” axis are well known. Outsourcing, in the sense of develop the strategies for “Work 4.0” Source: Ellguth/Kohaut 2016 transferring work which was previously carried out internally to sub- by taking industry as the starting point.

There is also a downward trend in co-determination by workers under the contractors located within the country or abroad (offshoring), was a key To achieve “good work” for as many laws on parity co-determination or one-third employee representation on element of the rationalisation which took place during the structural workers as possible amidst the digital supervisory boards. An analysis by the Hans Böckler Foundation found that 635 changes of the 1990s, in particular; it applied to simple, discrete work revolution, the transformation process- companies were covered by the 1976 Co determination Act (Mitbestimmungs- steps in manufacturing, but also services in the fields of administration, es in the social service sectors, in par- gesetz) in 2015, more than 100 fewer than the peak reached in the mid-2000s. It is estimated that around a further 1500 companies currently have corporate sales and marketing. This trend has tended to increase recently. Instru- ticular, must be placed centre stage. « co-determination in accordance with the Act on One-Third Employee Rep- ments such as temporary agency work or contracts for work and ser- United Services Trade Union (ver.di) resentation in the Supervisory Board (Drittelbeteiligungsgesetz).104 vices help, on the one hand, to increase flexibility in labour utilisation

104 Bayer 2016. 105 Castells 2003. 84 106 Apt et al. 2016. 85 Challenges Challenges

---» Digital business models, plat- (for example, to cope with peaks in demand), and to purchase specific form industrial relations and the world of work for employees. Numer- ---» Increasingly, other forms of forms and services are creating new services. Sometimes, however, they are misused to permanently replace ous responses to the Green Paper also draw attention to this. » jointly organised collaboration will forms of work, such as crowdworking. standard employment with other forms of employment. « emerge, for example if entire teams They are characterised by highly The organisational forms and working contexts shown along the c ollaborate solely in a virtual space flexible working which can be indivi- Flexible ways of organising companies and work horizontal axis are focused inward. Certain aspects of quantitative (e.g. in the cloud), without any dually determined. The discussion flexibility in internal labour utilisation are well known: fixed-term con- geogr aphical connection. Often about Work 4.0 should not aim to GREATER EXTERNAL FLEXIBILITY AND tracts and part-time work have long been established elements of this enough, the lines will blur between EXTERNAL TRANSFER OF BUSINESS RISK define a new standard employment (« box on labour-market trends, p. 49). In particular, more differentiated these two organisational forms. « relationship. What was defined as working time models have recently gained in importance, partly in response German Retail Federation (HDE) External crowdsourcing standard in the mid-1980s is no longer to operational flexibility needs, and partly in light of workers’ wishes and Outsourcing standard today and will be even less so preferences (« Chapter 2.5). » for future generations. « POINT OF REFERENCE: Contracts for work and services German Association for Information Technology, THE STANDARD COMPANY Temporary agency work Finally, the digital transformation of the economy has also seen the ---» Temporary work and ÿx ed-term AND EMPLOYMENT Telecommunications and New Media (Bitkom) spread of “agile” forms of project management and product develop- contracts are a very big problem! How RELATIONSHIP GREATER INTERNAL FLEXIBILITY ment – frequently inspired by the IT industry, whose approaches and am I supposed to give a company my all working methods, such as design thinking and Scrum , are now applied when it might give me the cold shoulder Homeo˜ce ---» The decision on whether value in many sectors. Companies do not always adopt these approaches of a month later? « creation takes place in-house or wholly Mobile working their own accord; often they are simply reacting to pressure for change 22 Apr. 2015 via arbeitenviernull.de or partially using contracts for work Virtual teams Part-time work from new providers which, with short innovation cycles and a strong Fixed-term contracs Agile forms of work and services is part of the free business Coworking Spaces Internal crowdsourcing customer focus, are shaking up markets and challenge established 108 decision to “make or buy”. Genuine Flexible working time models companies. Few companies can now afford inflexible bureaucratic contracts for work and services must procedures and decision-making processes or multi-year innovation and ---» It can be very valuable for SPATIAL DECENTRALISATION not be discredited by isolated cases development cycles, given the high pace of technological and market c ompanies to move towards targeted AND VIRTUALISATION where they have been misused. « changes. Finding responses to the – in some cases disruptive – transfor- and structured integration of creative Federation of Chemical Source: adapted from Hofmann/Nøstdal 2014. mation of business and production models has become a key challenge. » methods. Using the creativity and Employers’ Associations (BAVC) inno vative capabilities of in-house staff The “agile company” could emerge as a potential new model in this can lead to the development of new context. It places people and their communicative, creative and decision- servic es and products and help One fairly new phenomenon is external crowdsourcing, with work making capabilities centre stage in a new way: workforces must be c ompanies to secure an advantage being outsourced digitally to the crowd. Crowdworking occupies comprehensively empowered to drive forward and test small develop- in global competition. « an extreme position in the options of “make, buy or cooperate”107 ment steps autonomously and at a fast pace.109 The organisation of Hasso Plattner Institute for (« Chapter 2.2). It is not clear at present how relevant this approach, work, support for innovation and the design of jobs and collaborative Software Systems Engineering (HPI with labour being purchased on a situational and potentially completely spaces are elements which, not least in view of this need, require a anonymous basis, will become in the coming years. change in leadership and corporate cultures. If the transformation is successful, workers will have opportunities to work more autonomously In many sectors, including traditional industrial sectors, crowdsourcing and holistically in more independent teams, while companies could is likely to play a minor role for the foreseeable future. However, it has long been clear that digitalisation and the reconfiguration of value chains it has facilitated are also allowing new virtual organisational forms

which stop short of the crowd variants, and this will continue to trans- 108 See the expert workshop organised by the Federal Ministry of Labour and Social Affairs on “Socially Compatible Change Management and Good Corporate Management”, http://www.arbeitenviernull.de/dialogprozess/workshops.html. The workshop showed, among other things, that numerous conditions must be met if agile methods used in project-related work are to be applied in other areas of work. 86 107 Sydow/Möllering 2015. 109 Boes et al. 2015; Sattelberger 2015. 87 Challenges Challenges

---» It is already foreseeable today benefit from greater innovation and higher productivity. However, Even if the “virtual-only” company will not be a widespread economic ---» The opportunities and risks of that skills like creativity, network problems such as a breakdown of the boundaries between work and reality for the foreseeable future, it is nonetheless clear that greater a digital transformation are not thinking and disruptive thinking (will) private life , and the transfer of business risks to workers must be flexibility is being introduced along the three axes set out above and that diametricall y opposed; instead, the play a crucial role. « avoided. Or in other words: “agile” must be more than just “lean” in a new forms and combinations are emerging in this context. opportunities can only be unlocked by Alliance of German Designers (AGD) new guise. «« allaying workers’ concerns and reser- Regarding all of the issues outlined above, nothing is inevitable; there vations. Potential obstacles must The spatial decentralisation axis also features familiar elements are always options in relation to a company’s organisation. External ther efore be addressed in order to tap ---» Visions of global collaboration which are being boosted by the possibility of digital and virtual collab- flexibility must be possible in dynamic markets. However, certain limits into digitalisation’s potential for in virtual teams across company oration. The earliest legal provisions on homeworking by wage and salary should be imposed – including via legislation – on the systematic trans- sustainable economic and social boundaries raise questions about employees are over a century old. What is new are the increasingly diverse fer of business risks to temporary agency workers or crowdworkers . inno vation. This can best be achieved integration, leadership and oversight, possibilities for incorporating employees working outside the work- Co-determination in the workplace, supplemented by participatory if workers are involved and can better as well as requiring adjustments in place into workflows. This includes better-connected home and mobile approaches, is a major opportunity to draw on workers’ skills in order participate in shaping their working skills, working time and location. workstations, and virtual collaboration within the company using tech- to reshape the way in which companies and work are organised, so that conditions. « Collaboration between in-house and nical and software solutions. Internal crowds within a company, which they are fit for the future. The same applies to flexibility in working German Trade Union Confederation (DGB) external staff in mixed teams and the allow interdepartmental and cross-site teams to be formed to handle time and location, which functions more effectively if innovative integration of highly skilled service projects before disbanding again, are one possible example of this, and they appr oaches to organising work are negotiated between the company providers for specific tasks are already can in turn be combined with flexible integration of external workers. and the workforce or its representatives, as well as within the workforce. a reality today. « All of this requires a modern leadership culture, an effective occupa- Gesamtmetall – Federation of German Employers’ The opportunities of locational flexibility are as obvious as the poten- tional health system, and smart human resources management. 111 » Associations in the Metal and Electrical tial pitfalls: greater self-determination, new possibilities of combining Engineering Industries work and personal commitments and a better work-life balance are realistic hopes for the working world of the future. At the same time, it ---» We need a frank discussion, is becoming increasingly clear that we must first learn how to navigate right across the economy and public the introduction of greater flexibility. Often there are no clear rules. Not administration, about how good leader- least for this reason, people often find the increased blurring of work- ship can and should use existing resources life boundaries stressful. With regard to collective staff representation, it and unlock people’s potential! « is also important to keep an eye on the risk of workforce fragmentation. 22 Apr. 2015 via arbeitenviernull.de This specifically applies to potential shifts in the ratio of the core workforce to self-employed workers on an organisation’s periphery, which could have an impact on institutional co-determination . But even setting the ---» Truly agile companies are agile issue of the relevant thresholds aside, the fundamental question is how and stable at the same time. the process of identifying and representing collective interests will be #arbeiten40 affected as industrial relations become increasingly virtual. 110 #arbeitenviernull « 17 Mar. 2016 via Twitter

88 110 Wehling 2000; Benner 2014. 89 111 New Quality of Work Initiative (INQA) 2014. A VISION FOR QUALITY JOBS IN THE DIGITAL AGE

3 A Vision for Quality Jobs

A VISION FOR QUALITY ship, and the resulting ability to reach compromises – these are central 3. 115 prer equisites for success in the current transformation process. JOBS IN THE DIGITAL AGE They provide the framework for negotiated flexibility in the social market economy.

The coalition agreement of the current governing coalition at federal The trends and challenges set out in Chapters 1 and 2 illustrate the level devotes an entire subchapter to the goal of “good work” and forces affecting our world of work. While they are certainly transform- underlines that “full employment with good and productive jobs” is ative, they by no means predetermine the direction in which we are of strategic importance for “sustainable progress”.116 The OECD uses heading. As a society our aim should be to combine the huge economic the term “job quality” and looks at three key issues in this context: potential of this transformation with social innovation. We are facing earnings, labour market security and the quality of the working envi- the task to make the most of the opportunities Work 4.0 offers: both ronment.117 The concept of “decent work” as used by the International in terms of value creation and productivity; but also in terms of skills- Labour Organization (ILO) is defined much more broadly; it has been acquisition and individual self-determination. In order to succeed, we incorporated into many UN human rights declarations, reports and res- need to be a learning society open to innovation. And we must define olutions, including the 2030 Agenda for Sustainable Development.118 clearly our goals when it comes to achieving quality jobs. Over the course of the Work 4.0 dialogue, five areas have emerged The vision outlined in this chapter builds on the strengths of the which we view as essential components of a vision for quality jobs in German economic and social model, which is characterised by a strong the digital era. Small and Medium-Sized Enterprise (SME) sector, diversified, high-quality production, innovative industry, and a strong export orien- INCOME AND SOCIAL SECURITY tation. It is important to use this comparative advantage, in order to Social protection and an income based on merit and ability are fun- stay internationally competitive in the long term while maintaining damental prerequisites for ensuring that every individual can live from high environmental and social standards and taking incremental steps his or her work and can rely on a social safety net even in hard times. It towards further innovation.112 Such a strategy allows us to maintain is important that the potential productivity gains of digitalisation also high wage levels and depends crucially on a highly skilled labour force. lead to wage increases in all sectors. Collective agreements are an important instrument in this context. The principle of fair remuneration In our view, promoting quality jobs is contingent on balancing security for performance must be reflected in reliable pay and an end to the and flexibility in the future world of work.113 Flexibility without security, gender pay gap. Collective agreements play a crucial role here, as does on the one hand, would result in people being unwilling to commit to the early provision of vocational guidance and counselling in ensuring a sometimes difficult new learning processes. Security without flexibility, stable employment history for the individual. In a work-oriented soci- on the other hand, would sti‰e creativity and innovation. We therefore we ety, good social protection systems are particularly necessary when need both: security and flexibility. The state has an important role to play people are not in work or are no longer able to work. Providing social in driving innovation and promoting technology, but it also serves to protection against the major risks in life, such as old age, illness, acci- provide security during periods of transformation by actively supporting dents and unemployment, will remain a core function of the welfare high quality, innovation-rich working conditions.114 Inclusive political state. Where people wish to be self-employed, they should be support- and economic institutions, a long-established system of social partner- ed and offered better social safeguards than are currently provided.

115 Acemo�lu/Robinson 2012. 112 Hall/Soskice 2001. 116 Coalition agreement between the CDU, CSU and SPD 2013. 113 Stiglitz/Greenwald 2014. 117 Cazes et al. 2015. See also Federal Statistical Office (Destatis) 2015c. 92 114 Mazzucato 2014. 118 United Nations (UN) 2016. 93 A Vision for Quality Jobs A Vision for Quality Jobs

ACCESS TO QUALITY JOBS RETAINING THE QUALITY OF WORK Every individual should have the opportunity to access quality jobs, With regard to the quality of work within the digital transformation, i.e. secure work offering the possibility of professional advancement. At the four key aspects are: dealing with greater flexibility, a changing all times, our aim should be full employment through high-quality jobs. interaction between humans and machines, new forms of organising People who are not equipped to perform skilled labour need support labour, and the role of Big Data in the production process. They all and new opportunities. Jobs that offer little in the way of a reliable in- carry the potential for making work better, but they can also be a new come or secure prospects will continue to exist in the future. However, source of strain. We must find ways to support new production pro- they should not dominate the entire course of a person‘s working life. cesses and business models and to combine them with a modern sys- And securing employability via skills development will become increas- tem of Occupational Safety and Health 4.0 (¥ Chapter 4.4). ingly important, even for workers with skilled vocational qualifications. CONSIDERING CO-DETERMINATION, PARTICIPATION AND VARIETY AS THE NEW NORMAL: CORPORATE CULTURE AS A WHOLE A LIFE-PHASE APPROACH RATHER THAN RIGID Many of these aims require an adequate regulatory framework; the MODELS OF WORK specifics, however, can best be negotiated and designed by social part- These “conventional” needs are being joined by new ones: people’s ners and at the workplace level. Representative structures will contin- preferences and requirements regarding work change over the course ue to be necessary, but there is also a growing desire for individual of their lives. In many respects, the idea of one standard employment participation in organisations. Institutional co-determination , worker relationship for all no longer reflects today’s realities. “Standard” or participation and a good corporate and management culture are there- “normal” employment relationships are in fact becoming less the norm. fore no contradictions, but complementary. Together, they are the Rather, variety is the new normal, as people move, for example, be- prerequisites for innovative and democratic companies within an inno- tween full-time and part-time work; between employment and career vative and democratic society. breaks for family reasons, but also between employment and self-employment. It is questionable whether standard employment relationships should be starkly contrasted with “non-standard employment”, especially in the case of part-time work (¥ Chapter 4.2 and Chapter 5). The social partners and policy-makers face the task of recognising diverse preferences regarding work and thus giving people greater self-determination over the life course. It is important to provide social protection at times when people are in transition between different gainful activities or between periods of work and career breaks for family reasons.

94 95 POLICY OPTIONS

4.1 EMPLOYABILITY: FROM UNEMPLOYMENT INSURANCE TO EMPLOYMENT INSURANCE 4.2 WORKING TIME: FLEXIBLE, BUT SELF-DETERMINED 4.3 THE SERVICE SECTOR: FOSTERING GOOD WORKING CONDITIONS 4.4 HEALTHY WORK: APPROACHES FOR OC CUPATIONAL SAFETY AND HEALTH 4.0 4.5 EMPLOYEE DATA PROTECTION: SAFEGUARDING HIGH STANDARDS 4.6 CO-DETERMINATION AND PARTICIPATION: SHAPING THE TRANSFORMATION IN PARTNERSHIP 4.7 SELF-EMPLOYMENT: FOSTERING FREEDOM AND SOCIAL PROTECTION 4.8 THE WELFARE STATE: FUTURE PROSPECTS AND EUROPEAN DIALOGUE 4 Policy Options 4. POLICY OPTIONS

The following sections draw conclusions and identify policy options ees but also by self-employed individuals, whose number may rise in for the main areas discussed within the Work 4.0 dialogue. Each the future as a result of the digital transformation. There are key issues subchapter reviews the most important questions from the consulta- affecting this group of workers that urgently need addressing; ranging tion process, sets out points on which a consensus exists as well as the from a good income and social protection to co-determination and dividing lines, and summarises the most important outcomes of the participation issues (… Chapter 4.7). Chapter 4 concludes by looking discussions. Some subchapters build on analyses from the first two ahead to the future of the German welfare state and social security chapters. Others offer additional findings before drawing conclusions systems (… Chapter 4.8), which will also face challenges in light of the in the relevant field of action. transformations in the world of work.

The range of policy options stretches from short-term measures, some of which have already been undertaken or are planned for the current electoral term, to medium-term measures proposed for the next legislative period, to prospective projects for the long term. Where findings have led the Federal Ministry of Labour and Social Affairs to conclude that no action is needed at present, these results are also presented. Finally, there are a range of areas where further examination and studies are needed.

The first subchapter sets out how a high level of employment and employability can be ensured in the World of Work 4.0 (… Chapter 4.1). To secure this even amidst the digital transformation , major efforts will be needed in relation to skills development and continuing vocational education and training. Questions relating to the organisation of work, and in particular the organisation of working time (… Chapter 4.2), have been an important priority in the consultation process. Here, it is important to reconcile companies’ flexibility requirements with workers’ preferences. Most of the topics examined in Chapter 4 apply to all sectors, but at the same time there are special issues concerning work in new service markets (… Chapter 4.3). Attention must be paid to safeguarding conditions for decent and healthy work (… Chapter 4.4). The same applies to the right to informational privacy that needs to remain guaranteed in a digitalised economy and for which employee data protection must also ÿnd answers (… Chapter 4.5). Wherever workers’ co-determination and participation is ensured on an equal footing, solutions at the company-level can be used to tailor statutory requirements (… Chapter 4.6). However, the future world of work will be shaped not just by employ-

98 99 Policy Options Policy Options

4.1 EMPLOYABILITY: FROM UNEMPLOYMENT TO EMPLOYMENT INSURANCE

Although forecasts concerned with digitalisation’s impacts on the vation are all key elements in the state’s role of helping shape structural ---» Digital profits must contribute labour market come to varying conclusions, they all agree that the pace changes while providing a social safety net. « to the funding of social tasks. « of change in the coming decades will be rapid. As occupations and 24.4.2016 via arbeitenviernull.de sectors are transformed, attention needs to be focused more on the Labour market policy offers support for labour market integration. subject of maintaining individual employability amidst this trans- Yet it can and does do more. During the last decade’s global financial and formation. Full employment in decent jobs for all remains our goal. economic crisis, for example, a forward-looking labour market policy played a significant part in preventing massive job losses in Germany. For most workers, decent work primarily means a secure, permanent This allowed the German economy to weather the crisis better than job and an adequate income which they can live on.119 The Work 4.0 many other countries. dialogue mainly concentrated on “new” areas where conflicting priorities are on display within the world of work outlined in Chapter 2. None- Labour market policy also has a key role to play in shaping structural theless, several partners in the consultation process rightly warned that change. This too is evident from a look at the past: As early as the mid it is important not to lose sight of the “old” questions. The Federal 1960s, there was a broad public debate about implications of automa- Government has taken many steps in the current electoral term to tion and on how to shape this development.120 It led to the 1969 Employ- safeguard and improve stability on the labour market – from the mini- ment Promotion Act (Arbeitsförderungsgesetz), which laid the founda- mum wage, to action to prevent misuse of temporary agency work and tion for preventive labour market policy. Today, half a decade later, the contracts for work and services, to better integration of the long-term digital transformation requires a new realignment of labour market unemployed and of refugees into the labour market. policy aimed at preventing or reducing unemployment and securing a high level of labour market participation. Particularly in light of the fact that If we want to maintain a high level of employment in the face of dig- the potential labour force is expected to shrink as a result of demo- ital structural change, the distribution of profits through gains in pro- graphic change, forward-looking steps must be taken to ensure that a ductivity will also be a central issue. Corporate profits – including those gap does not open up between supply and demand in the labour market. of large digital platforms – need to be subjected to taxation. Public goods and services and a modern infrastructure require sustainable f inancing over the long term. A high level of income creates demand for products and services in growing markets and safeguards employment in these areas. Consequently, the issues and aims in the field of labour and social policy raised in this White Paper cannot be regarded in isolation. They must be dovetailed with an employment-focused economic policy. For in times of sweeping structural change, a wide range of instruments are needed in order to achieve the aim of full emplo yment (… Chapter 2.1). An enabling macroeconomic framework, industrial and services policies, and the funding of research and inno-

100 119 INQA 2015 120 See Der Spiegel 1964. 101 Policy Options Policy Options

---» The key to shaping the digital To date, the necessary regular monitoring of future demand for The vital importance of education, continuing vocational education ---» SMEs in particular generally transformation of work lies in our skilled labour is not yet in place. Such monitoring would provide a reg- and training, and skills development for a successful digital transfor- lack the resources for systematic, emplo yees’ skills. The teaching of digital ularly updated forecast of trends in demographic, regional and skills- mation was repeatedly emphasised by experts in the consultation process, strategic, forward-looking human skills must begin in general-education related mismatches, and thus also serve as the foundation for a realign- as well as by studies and responses to the Green Paper. The unanimous resources planning and development. and vocational schools, as well as higher ment of labour market policy. view is that Germany’s success in the digitalised, globalised world will The Federal Employment Agency education; occupational profiles must be hinge on our readiness to leverage significant efforts in this field. Views therefore intends to focus more on adapted; and skills development modules To secure the skilled labour base, it will remain necessary to make differ, however, on the conditions under which support should be pro- these companies, as they are in with practical relevance must be use not only of migration but also of existing potential, especially that vided for continuing vocational education and training, in particular, and particularly urgent need of support. « designed to support lifelong learning. « offered by a further increase in women’s employment and the integra- how it should be organised and financed. Federal Employment Agency Daimler AG tion of low-skilled workers. However, it will be just as important, if not more so, to maintain and boost the employability of each individual. The Federal Employment Agency’s role and importance in relation to ---» We want to see the Federal This makes a forward-looking and strategic skills policy the mainstay of skills development is singled out in many responses to the Green Paper. Employment Agency’s existing activities ---» All levels of the state should employment and labour market policy in the digital transformation . « It is already active today in advising SMEs and workers about the labour in the field of continuing vocational develop and support further new market, skills development and continuing vocational training and up- education and training expanded to possibilities for socially useful work, ISSUED RAISED IN THE CONSULTATION PROCESS skilling.121 Both the SME sector and trade unions are calling for these become a comprehensive system. This as a complement to gainful employ- The responses to the Green Paper identify the securing of employ- activities to be developed further, especially as regards the pooling of means that the employment agencies ment. This could make it possible to ment and incomes as core functions of future labour and economic continuing training capabilities, for example in the form of regional should offer continuing vocational emphasise and consider work’s social policy. That said, they emphasise varying aspects: while municipalities, employers’ groups.122 The Work 4.0 Working Group set up by the Confer- training to workers in employment and other aspects, beyond the narrow for example, call for creating or expanding publicly funded employment, ence of the Labour and Social Affairs Ministers of the Länder is also to a much greater degree. « concept of gainful employment. « employers put a stress on the need to adapt the skills mix to reflect calling for an advisory service on continuing vocational education and Industrial Mining, Chemical and Energy Union (IG BCE) Association of German Counties (DLT) changes in labour demand. « training that should be freely accessible for all, and for greater public funding to be made available for quality assurance and the profession- alization of the staff involved.123 » ---» It could also be helpful, however, to offer support structures which There are also advocates of other forms of state support, such as a enable SMEs to pool continuing wage compensation benefit based on the Austrian model of part-time vocational education and training training leave.124 Tying in with steps being taken in collective agreements capabilities. Companies could form in the metal and electrical industries and the call for state action to create employers’ groups on a regional basis a framework for part-time training leave, the German Trade Union Confed- in order to offer their workers a wide eration (DGB) argues that the identification of skills needs and support range of continuing training options for part-time skills development measures should be key elements in which they could not provide alone. reforming the system for continuing vocational education and training Support from a potential skills agency and skills development. 125 « could be helpful in this context. « German Confederation of Small and Medium Sized Enterprises (BVMW)

121 Federal Employment Agency (BA) 2015. 122 German Confederation of Small and Medium Sized Enterprises (BVMW) 2015. 123 Conference of the Labour and Social Affairs Ministers of the Länder (ASMK), Work 4.0 Working Group 2016. 124 United Services Trade Union (ver.di) 2015. 102 125 German Trade Union Confederation (DGB) 2015. 103 Policy Options Policy Options

---» The model of part-time SHAPING THE WAY AHEAD Basic skills are needed in almost all jobs in Germany. Imparting these ---» One particular priority must training leave picks up on the once The function of labour market policy is to align three different sets of essential skills is a task for the education and vocational training system, be teaching IT skills across the board. common support for part-time work aims and interests. Workers want career prospects and a successful work- which will therefore focus more on digital skills in the future. Lifelong In this context, skills development is leading into retirement, and uses this ing life. Businesses need qualified skilled workers , in order to remain vocational learning will also play a much more important role in future. needed at all levels of the education model’s mechanisms to support skills innovative and competitive amidst the digital transformation . Society The digital transformation is changing the mix of tasks within existing system. STEM skills (science, techno- development. The Austrian model is has an interest in as many people as possible participating in the labour occupational profiles and leading to a more complex blend of required logy, engineering and mathematics) helpful when considering this possi- market. There is therefore a shared interest in greater investment in skills , which will make additional digital qualifications compulsory in must be taught and developed more bility: a law on part-time training qualifications and skills. « almost all sectors and occupations. Social, communicative and intercul- intensively and holistically, starting in leave has been in place since 1 July 2013. tural skills, systemic and creative thinking, the capacity for abstract schools. The same applies to higher Individuals are able to reduce their Consequently, the Federal Ministry of Labour and Social Affairs intends thinking, and rapid information processing and data selection capabili- education. « working time in order to undertake to update the Federal Government’s Skilled Labour Concept, which ties are vital for success in the labour market. Gesamtmetall – Federation of German Employers’ Associations in the Metal and continuing training, and receive a state- was established in 2011, and link it with a skills strategy for the changing Electrical Engineering Industries funded “income replacement” benefit world of work. The most recent progress report on the Skilled Labour Digital literacy , the ability to conÿdently deal with online sources and for the reduction in their hours. « Concept shows that many targets have already been reached. At the more generally with new, mobile computer and online media (devices, United Services Trade Union (ver.di) same time, new challenges have emerged both on the supply side, in Web 2.0 applications), is becoming a basic requirement. In the most recent ---» In future, it will be necessary connection with the integration of refugees into the labour market, and OECD’s PIAAC survey , just eight per cent of respondents stated that to regard digital skills as an integral on the demand side, especially as a result of digital structural change.126 they never use a computer in their work. Basic digital skills, then, are element of an individual’s readiness to already necessary in order to meet professional requirements in almost take up vocational training. Ensuring ---» A high skills level and continuing To reduce the uncertainties outlined above regarding future demand all jobs in Germany even today.127 « people reach this level of readiness is development of competencies is in the for skilled labour and for skills, the Federal Ministry of Labour and Social the responsibility of the Länder and interest of both employers and workers. Affairs will introduce a new monitoring of future skilled-labour needs. schools, in particular. « Skills development helps to secure and The analytical results could be discussed by the Federal Government Confederation of German Employers’ Associations (BDA) boost companies’ competitiveness and and the social partners, for example within the framework of the Partner- maintain workers’ employability. In this ship for Skilled Professionals. They could also feed into the work of the context, the principle should be that the relevant regional labour market stakeholders securing the supply of skilled ---» Attaining digital literacy costs are shared fairly between employers labour (chambers of commerce and industry, chambers of crafts, invest- should become a key and measurable and workers, taking into consideration the ment promotion organisations, the Federal Employment Agency), e.g. via factor for success in our education operational and individual benefits. « cooperation between regional networks for securing the supply of system, from school, to vocational Federation of Chemical skilled labour and the Innovation Ofÿce for Skilled Labour for the Regions, training, to higher education and Employers’ Associations (BAVC) which is supported by the Federal Ministry of Labour and Social Affairs. continuing vocational training. « German Association for Information Technology, Based on reliable skilled labour demand and supply forecasts, labour Telecommunications and New Media (Bitkom) market stakeholders from the political, economic and social spheres can take a more targeted look at workers’ initial and continuing training, as Germany’s future as a location for business depends to a crucial extent on its workers being well-educated and skilled.

104 126 See Federal Ministry of Labour and Social Affairs (BMAS) 2015d. 127 Rammstedt 2013. 105 Policy Options Policy Options

---» Expanding skills, step by step, is The transformation of the world of work and, more generally, the non-linear work histories, make it possible for him or her to change a vital task in human resources world we live in is shaping professional biographies on all skills levels: employers and sectors, and facilitate transitions between permanent development. Continuing training and they are becoming more dynamic, varied and individual. Thus, in order to positions, self-employment and family-related career breaks. individual participation will be key for avoid obstacles in people’s working and personal lives, workers must individuals, while co-determination be given active support in their change and adaptation processes. The Besides these two perspectives, the public interest must also be kept will be key for all workers. « main challenge for labour policy is to manage transitions between main in mind. Continuing vocational education and training is in the overall Association of Staff Councils of stages of working life, to actively support individuals as they start, economic interest, as better education leading to a higher growth poten- the Supreme Federal Authorities change and advance in their careers, and to prevent backward steps. «« tial means that revenues from contributions and taxes can be expected to increase. The 2016 OECD report “Skills Matter”, which is based on ---» When it comes to flexibility in We need a comprehensive stragegy for long-term skills develop- PIAAC data, shows that, going beyond productivity gains of this kind, working life, Germany is a developing ment and continuing vocational training. The implementation of this there is also a correlation between skills and desirable non-economic country. #arbeitenviernull « strategy should be discussed at a “National Conference on Continuing factors, such as trust, political participation, and health. The report 22 Apr. 2015 via Twitter Vocational Training”, with the involvement of all relevant ministries of the concludes that investment in basic skills provides positive economic Federal Government, the Länder, the social partners and other stake- and social returns for both individuals and society as a whole.128 holders. The aim should be to expand, bring together and integrate all strands of continuing vocational education and training at federal and However, if the transformation is to receive this kind of active support Länder level, in order to establish a consistent overarching strategy. from economic and labour market policy, a broad ÿ nancing base is required for the necessary campaign to promote skills development and continu- Already today, the Federal Government is using various instruments to ing vocational education and training. The costs relating to the provision support continuing vocational education and training and skills develop- of advice, continuing vocational education and training, release from work ment measures for workers and unemployed persons. Most of the training and wage replacement must therefore be shared fairly between the for workers is carried out by the employment agencies and job centres in state, companies and individuals. In this context, it must be clarified line with the regulations on employment promotion and basic income what proportion should be financed via contributions and what propor- support. A second key pillar is implemented through the Upgrading tion via taxation. Training Assistance Act (Aufstiegsfortbildungsförderungsgesetz), in the form of financial assistance for master craftsmen trainees (Meister-BAföG), for which the Länder are responsible. Gaps between these two channels for support must be closed, bearing in mind companies’ and employers’ responsibilities, especially as regards preventive continuing training for their workers “below” the level of career advancement schemes.

Furthermore, it is important to keep two different perspectives in mind, which in some respects conflict with each other. From an organisation’s perspective, continuing vocational education and training primarily serves to develop, apply and update the skills required within the organisation, to retain skilled workers, and to provide impetus for innovation, productivity gains, as well as human resource and organisational development. From the perspective of an individual’s life course, continuing vocational education and training can serve to maintain and improve his or her individual employability in a highly dynamic world of work with

106 128 Organisation for Economic Cooperation and Development (OECD) 2016. 107 Policy Options Policy Options

CHALLENGES FOR THE CONTINUING TRAINING SYSTEM Action is needed at three levels to improve the continuing vocational education and training system. At the same time, digitalisation is also generating new or evolved formats for continuing training, such as blended learning . These new Opportunities for access: in 2014, participation in continuing voca- forms of learning allow greater flexibility in when and where continuing tional education and training rose to above 50 per cent for the first training takes place, and promote learning in the workplace. Computer- time. Particular progress was made in the case of semi-skilled and based training paves the way for workflow-integrated learning. This unskilled workers (up 7 percentage points compared to 2012) and indi- cuts costs and allows for immediate application of newly acquired ---» Even now, too few people know viduals with low levels of educational attainment (up 4 percentage c apabilities. Digital assistance and tutoring systems go further and how to properly use the possibilities points compared to 2012). Nonetheless, participation in continuing offer the worker individually tailored assistance and explanations with- offered by today’s technology. I hope vocational education and training remains socially selective in Germany. in the production process. New continuing training formats and systems this will change in future and that There are relatively large disparities in the distribution of opportunities can help to impart content in appropriate ways for specific target groups older generations will also be able to for access: people over the age of 50, low-skilled people, people with a and ages. Part-time employment must not implicate a lower level of make the most of this potential. « migrant background , employees of small companies, and temporary participation in continuing vocational education and training. » 22 Apr. 2015 via arbeitenviernull.de agency workers take part in continuing training much more rarely than others.129 This consultation process indicated that special attention FROM UNEMPLOYMENT TO EMPLOYMENT INSURANCE must be devoted to the fact that low-skilled workers in particular are The following paragraphs map out a new policy on continuing voca- often involved in highly concentrated work processes with fixed cycles, tional education and training. The fundamental principle is for the current and this alone means they have little leeway to engage in continuing unemployment insurance to become more focused on prevention, with training in their day-to-day work. the ultimate aim of transforming it into an employment insurance that actively supports transitions within people’s working lives via periods Information and counselling: besides the advice provided by the Federal of continuing vocational education and training. It is important to provide Employment Agency, many other institutions are active in this field, such preventive protection against new employment risks, to systematically as chambers or adult education centres. However, there is no nationwide support professional development and advancement opportunities network of independent, low-threshold counselling centres; nor are over people’s life course, and to boost “innovative hazard”.131 The aim is there binding quality standards for the provision of counsel. The degree nothing less than a widening of the insurance concept, as in the modern of professionalisation among counsellors also varies widely. world of work it will be more important than ever not to define risks as existing only at the moment when unemployment is imminent or already Systematisation: the German continuing training landscape is extremely a reality. Instead, preventative action should be taken over the life heterogeneous and is shaped by various stakeholders, institutions and course in order to safeguard and increase individual employability . educational traditions, which makes it tremendously difficult to coordi- This includes a higher degree of skills development for all workers – includ- nate the planning and implementation of continuing vocational education ing preventative measures, and measures designed to support their career and training in tailored ways for specific target groups.130 Continuing pathways – but especially for those who currently participate less in training institutions primarily follow their own institutional mandate. skills development. This hinders cooperation between public, in-company and external continuing training institutions, all of which are committed to different educational traditions. It is also important to overcome disparities in how the different types of continuing vocational training (formal, non-formal and informal) are treated.

129 Federal Ministry of Education and Research (BMBF) 2015; Bellmann et al. 2013. 108 130 See Baethge et al. 2013. 131 Schmid 2012. 109 Policy Options Policy Options

The process of further developing the unemployment insurance In this context, the Federal Employment Agency recently completed into an employment insurance should take place in several stages, a pilot project on continuing training counselling for workers and with short-, medium- and long-term steps. Each stage will build on rates the project very positively. The levels of interest in and demand learning experiences acquired during the preceding stage, which must for professional advice on continuing training are extremely high, espe- be systematically exploited. cially amongst those who are in work. They constituted the largest group of participants in the pilot project. Around 64 per cent of those Initial steps have already been taken during the current electoral who received counsel had an “interrupted” work history. These individ- term. The amendment of the Upgrading Training Assistance Act uals in particular can derive long-term benefits from preventative (Aufstiegsfortbildungsförderungsgesetz) strengthened the foundations counsel tailored to their phase in life. What is crucial is that the coun- for upward occupational mobility, and the Act to Boost Unemploy- selling has an impact, that it ignites people’s interest in continuing voca- ment Insurance Cover and Continuing Training (Arbeitslosenver- tional training, so that new opportunities for employment, develop- sicherungsschutz- und Weiterbildungsstärkungsgesetz) set an initial ment and advancement can emerge.133 course. The latter Act improves access for low-skilled workers and the long-term unemployed to continuing vocational education and training In the medium-term, the plan is to review existing means of supporting that leads to a formal qualification. It also facilitates more opportu- continuing vocational training, including those aimed at improving nities for continuing vocational training for employees of small and digital skills, and to further develop existing programmes. It must also medium-sized enterprises, i.e. those groups who tend to participate in be examined whether new opportunities to undertake continuing voca- continuing training more rarely. Bonuses for success provide targeted tional training while receiving the transfer short-time work allowance, incentives and motivate people to stay the course over several years of which were introduced by the Act to Boost Unemployment Insurance continuing training until they successfully attain a vocational qualifica- Cover and Continuing Training, can be extended beyond low-skilled tion. The Act is a response to results of the OECD’s PIAAC study, which and older people to include other groups in the future. Specifically, a found that low-skilled workers, long-term unemployed and older fprospectivesystem for continuing vocational education and training workers, in particular, have low levels of basic skills by international should contain the following elements: standards.132 The Act now enables support for basic skills to be provided where required, in order to empower adults without vocational qualifi- As part of the first stage, building on the experience acquired through cations to successfully undertake vocational training. the pilot project on continuing training advice, a high-quality, nationwide, lifelong counselling service run by the Federal Employment The next step should be to provide qualified counselling, including a Agency should bring the preventative, life-phase approach in unem- comprehensive skills assessment, to introduce more needs-assessed ployment insurance to the fore and adapt the Federal Employment support for continuing vocational training for workers, and to better Agency’s objectives in light of the transformation of work. In this context, integrate the various instruments. The Federal Employment Agency has greater attention will need to be paid to the insured person’s medium- wide-ranging experience with instruments used to analyse individuals’ to long-term employment and income prospects. This underlines the potential and assess their skills, and is represented in every region of the fact that labour market policy is an investment. Early and continuous country. It already holds the statutory task of offering advisory services protection against income and employment risks in transitions between to workers and employers. This includes both vocational guidance and various forms of work and employment is a central pillar of a welfare labour-market advice for employers. Both of these services should be state which takes a life-phase approach, and will act as a targeted sup- strengthened. The quality of advice offered should also be enhanced by plement to the existing protection against income risks in the event of properly taking into account the individual’s formal and informal skills, unemployment. In the medium-term, the Federal Employment Agency state of health and life circumstances, requirements of the labour market should consequently offer all interested individuals comprehensive and the complex continuing training landscape. v ocational guidance, including a comprehensive skills assessment and

110 132 Rammstedt 2013. 133 Institute for Employment Research (IAB) 2016b; Institute for Social Research (ISG) 2016. 111 Policy Options Policy Options

life-phase counselling. The advisory services for employers (especially In the process of implementing a comprehensive strategy for long- SMEs) could also undergo a targeted expansion in this context. term skills development and continuing training, an interministerial approach incorporating the activities of the Länder will be pursued, and As the employment prospects of semi-skilled and unskilled workers this should be negotiated in the framework of a “National Conference will deteriorate further in the labour market of the future, better support on Continuing Vocational Training”. This strategy should systematically options and incentives could conceivably help this target group to pull together the different strands of support, from initial to continuing achieve a vocational qualification later in life, on top of the existing legal vocational training, to career advancement training. This process could entitlement to acquire a lower secondary school certificate as adults. conceivably culminate in a continuing vocational education and train- For low-skilled individuals for whom acquiring a vocational qualifica- ing system with the following elements: tion is too great a hurdle, support could also be provided for skills development measures below the level of vocational qualifications or partial Within employment promotion, entitlement to support for continuing qualifications, irrespective of the size of the company. As an incentive vocational training for workers and unemployed persons and the services for businesses to take action to improve their employees’ skills against provided should vary according to the type of skills development – i.e. the backdrop of the digital transformation , the possibility of partial whether it is designed to maintain, develop or take skills to the next funding from the Federal Employment Agency for appropriate continu- level. The financial support provided should cover, in each case, the costs ing vocational training should be considered. of the skills development measure, and – provided that the insurance qualifying period has been completed – the cost of living and social As technologies and associated fields of activity undergo significant security costs for the duration of the training. Funding should come from changes, it is difficult even for workers with vocational qualifications to social insurance contributions, co-payments by companies and individ- keep abreast of these changes without continuous training. This trend uals, and taxation, depending on who the training’s main benefits accrue is what makes lifelong learning essential, and support for continuing to. In addition, supplementary regulations on employees’ release from vocational education and training imperative irrespective of age or work for the duration of the continuing training would be necessary, the size of the company, especially if some time has passed since indi- similar to those which already exist for parental leave. viduals originally acquired their vocational qualification and last received support for up-skilling activities. The reforms proposed here would require initial means-testing to be carried out in the framework of the continuing training advice provided by The targeted acquisition of IT skills will become more and more the Federal Employment Agency. In the long term, a Personal Worker’s important in a wide range of sectors. Broad cooperation with diverse Account could also be created, with a tax-funded “initial capital” which providers will therefore be necessary in order to implement a nation- workers could use for skills development and career breaks (… Chapter 4.8). wide pilot project for additional digital qualifications. There are alr eady initial pilot projects to develop additional qualifications of this kind, for example within the Berlin Senate’s contribution to the Work 4.0 dialogue.134

The measures outlined above must be designed in such a way that they can be supplemented by collective agreements. Sector-wide funds could conceivably top up public funding, for example by compensating for loss of earnings.

134 Berlin Senate Department for Labour, Integration and Women’s Issues (Senatsverwaltung für 112 Arbeit, Integration und Frauen Berlin) 2016. 113 Policy Options Policy Options

SUMMARY 4.2 WORKING TIME: • Germany’s future as an attractive location for business depends to a crucial extent on its workers being well-educated and skilled. In light FLEXIBLE , BUT SELF-DETERMINED of the digital transformation and demographic change, policy-makers must use a wide range of instruments to achieve the goal of full employment. An enabling macroeconomic framework, industrial and services Who sets the rhythm and pace when it comes to matters of working policies, and the funding of research and innovation are all key elements time in our future world of work? A wide range of different interests in managing this structural change. and needs are being voiced on this question as part of a lively, diverse debate (… Chapter 2.5): balancing companies’ and workers’ flexibility • Policy-makers must manage the necessary changes in the education needs while at the same time maintaining health and safety at work; system at all levels. Investment in education, continuing vocational edu- boosting individual time sovereignty ; taking into consideration different cation and training, and skills development boost economic competi- expectations and needs within a workforce; and protecting windows of tiveness and innovation in an ageing society. shared free time to support a lively community. The opportunities include more options for greater self-determination in the context of work and • The upheavals of the World of Work 4.0 make it necessary to invest better approaches to balancing work and personal commitments. The ---» ---» I am in favour of the at an early stage in strengthening skills maintenance and in enhancing critical issues range from growing flexibility requirements for companies, principle of flexibility in terms of advancement prospects over the whole course of people’s lives. The involuntary part-time work, the expectation for workers to be reachable working time and location, but I think Federal Employment Agency has a substantial role to play in that regard. at all times, unpaid overtime and unclaimed holiday entitlement to that issues like overtime and weekend Support has to focus more on prevention, and must not come into play non-compliance with rest periods in a world where boundaries between work must then be clearly regulated. « only once there is imminent risk of losing one’s job, or be limited to work and leisure become increasingly blurred. » 10 Mar. 2016 via arbeitenviernull.de upgrading low skills.

• The Federal Ministry of Labour and Social Affairs is planning to gradually develop the current unemployment insurance into an employment insurance to enable more preventative support for workers. An important element is the right to independent vocational guidance and counselling on continuing vocational education and training. Looking to the future, one aspiration is the introduction of a legal right to continuing vocational education and training. A comprehensive strategy for continuing training should be discussed and developed at a “National Conference on Continuing Vocational Training”, with the involvement of all relevant ministries of the Federal Government, the Länder, the social partners and other stakeholders.

114 115 Policy Options Policy Options

ISSUES RAISED IN THE CONSULTATION PROCESS Im sum, three key aims emerged from this section of the Work 4.0 ---» There is a risk that the new The subject of flexibility around working time and location was dialogue. Workers must be protected from overwork and a breakdown of forms of digital, round-the-clock examined in detail as part of the Work 4.0 dialogue and via the “Digital the boundaries between work and private life . Working times must reachability will not improve the Working World” platform within the context of the Federal Govern- be organised in such a way that workers’ health and safety are not situation for women and people ment’s IT Summit process.135 In a separate dialogue forum on working jeopardised. More options offering working time choice should pave the with family commitments, but time initiated by Federal Minister Andrea Nahles with the social partners, way for greater control over working time and location. New incentives instead result in increased strain. « companies, civil society and academia, a broad consensus emerged that for flexibility arrangements negotiated by the social partners ought to United Services Trade Union (ver.di) working time must be organised in a way which better takes into account facilitate new compromises on an innovative organisation of work particular and differing time needs over the course of people’s lives. and create more scope for arrangements at firm-level. ---» Companies are aware that ---» However, [...] a modernisation The discussion covered both factors for success and obstacles to the workers being available around the of the [...] statutory requirements is implementation of flexible working models in the workplace. There was Many workers express a wish for more flexible working hours and the clock is not a sustainable solution from useful and necessary in order to pave agreement that working time ®exibility can only be successfully put in place possibility of working from home so that they can better combine work the perspective of occupational health. the way for a new flexibility if it is flanked by suitable communication, corporate and management and their personal life. It is also becoming clear, however, that trust- Action is being taken to raise aware- compromise. For example, the cultures in companies. In this context, advisory services, networks, based working time , the growing expectation that workers should be ness about how to properly deal with Working Time Act must take advantage guidelines and the sharing of examples of good practice in organisa- reachable outside working hours, extra work and non-standard working modern forms of communication. of the leeway included in the EU tions, and specifically SMEs, are helpful in terms of implementation.136 hours can jeopardise the work-life balance. Work from home also con- H owever, in a digitalised world it will Working Time Directive, such as the tributes to blurring the line between working hours and leisure time. be impossible to draw as clear a line possibility to diverge from the 11-hour The discussion also tackled the question of what new flexibility com- A breakdown of the boundaries separating work and private life can between working hours and leisure rest period on the basis of a collective promises struck by employers and trade unions could look like, and have a negative impact on health. At the same time, the existing legal time as in the analogue era. « agreement, and to shift from a daily to what contribution the state can provide in this process. Employers, by framework already allows a large degree of flexibility while safeguarding Employers’ Association of Insurance Companies in Germany (AGV) a weekly approach to working time. « and large, put forward the view that legislation on working time should a high level of health and safety at work (… box). » Gesamtmetall – Federation of German be relaxed with regard to provisions on maximum working time and rest Employers’ Associations in the Metal and Electrical periods, in order to better meet businesses’ needs. Trade unions raised the The 119th German Medical Engineering Industries ---» possibility of new legal rights for workers (the right not to be reachable, Assembly 2016 expects the Federal ---» The Marburg Federation rights relating to the scheduling of working time, the right to home-ofÿce Ministry of Labour and Social Affairs incr easingly has the impression that working) and drew attention to shortcomings in the monitoring of to ensure that the existing binding even mandatory statutory provisions, compliance with the Working Time Act (Arbeitszeitgesetz). An intensive LEGAL REGULATIONS ON THE ORGANISATION OF statutory standards for the protection such as the Working Time Act, are debate also took place with respect to the option of expanding the leeway WORKING TIME of workers are not surrendered in r egarded by a few employers as more of social partners within the existing law, and, on this basis, setting up response to alleged greater flexibility German legislation is bound by the provisions of the European Working Time of a recommendation than a experimental spaces in businesses where new approaches agreed on by requirements. Directive. The Directive stipulates that the average working time for each « legal obligation. « social partners can be tested and scientiÿcally evaluated (… Chapter 5). « seven- day period, including overtime, may not exceed 48 hours. In addition, German Medical Association Marburg Federation of Doctors (MB) every worker is entitled to a minimum daily rest period of 11 consecutive hours per 24-hour period. The German Working Time Act (Arbeitszeitgesetz) aims, among other things, to ensure the health and safety of workers and to design the framework for flexible working time with this in mind. The Act is therefore based on the principle of an eight-hour day and six working days per week. Working time on a working day can be extended to up to ten hours without any special justification. There must be an offset, reducing the average working time to eight hours, within six calendar months or 24 weeks. Workers are entitled to an uninterrupted 11-hour rest period after the end of their daily working time. In principle, Sunday is the weekly rest day. 135 Beyond the Work 4.0 dialogue, the issue was discussed by a working group of the IT Summit’s “Digital Working World” platform, headed by the Federal Ministry of Labour and Social Affairs and the Metalworkers’ Union (IG Metall), with a focus on issues relating to the digital world of work. The working group’s recommendations have already been published; see Federal Ministry of Labour and Social Affairs (BMAS) 2016b. 136 Information about best practices can be found in Federal Ministry of Labour and Social Affairs 116 (BMAS) 2015c. 117 Policy Options Policy Options

It is possible for working time to exceed ten hours. A collective agreement The employer is responsible for compliance with the provisions. This can stipulate that, for example, working time is extended to over ten hours on remains true even if workers can largely determine their own working working days in the case of readiness for work (e.g. security services) or on-call time and/or place of work, or if trust-based working time has been service (e.g. hospitals, works fire brigades), and in special circumstances this is also possible without this extension being offset (opt-out). There are also certain agreed. The supervisory authorities must monitor compliance. sectors (agriculture; treatment-, long-term care and care-services; public service) where longer working times can be permitted by means of a collective agree- As a result of digitalisation, workers are increasingly expected to be ment. In addition, the supervisory authorities can permit longer daily working reachable outside working hours. The usual principles of labour law times in certain cases, for example for shift work, construction and assembly sites, and seasonal and campaign-based work. apply in this context. Workers are not obliged to be reachable by their employer in their leisure time. The only exception is if a legally permis- ---» Companies are currently still a Derogations from the 11-hour daily rest period are also possible. For example, sible, contractual agreement to this effect is in place. Without an long way from responding to the prob- in some sectors (e.g. medical, long-term care and care facilities, the hospitality agreement of this kind, there is no obligation to work overtime.137 lem, however. 81% of DFK managers sector, transport businesses, agriculture and livestock farming) the rest period can be reduced to ten hours, if the reduction is offset within four weeks by the There is therefore no obvious need for legislative action. This does not believe their own company has taken extension of another rest period to at least 12 hours. A collective agreement mean, however, that no action whatsoever is needed. Some companies no steps to limit constant reachability. can also stipulate a reduction of up to two hours in the rest period, resulting in have now concluded widely varying, well-received agreements on non- (...) Clarity is needed regarding reach- a nine-hour period, provided that this is required by the type of work. Moreover, reachability.138 The importance of such agreements is underlined by ergo- ability outside working hours. It is very social partners can allow for corresponding regulations to be introduced in a works agreement or an agreement between the employer and staff council. nomic and occupational health findings, which show, for example, that rare for companies to have formal a lack of time to rest and recover and excessively long working hours agreements on this. « If employees work in their leisure time (rest period), this must, in principle, can have negative impacts on workers’ health in the long term.139 » German Confederation of Managers (DFK) be regarded as working time within the context of the Working Time Act. The employer is responsible for ensuring that working times exceeding eight hours on working days are recorded. In general, the employer has an obligation to The wish for sovereignty over working time and location is growing ensure that employees comply with the statutory regulations. The Working Time (… Chapter 2.5). The Working Time Report Germany 2016 shows that Act does not apply to senior staff, however. the framework in place determines whether working time flexibility has a positive or negative impact on workers’ health and job satisfaction: if In the event that the stipulated rest period, generally eleven hours, is interrupted, it starts again from zero. The EU Working Time Directive offers no leeway workers can set or have a say in their working time, “flexibility can have a for a “de minimis arrangement” for short interruptions (e.g. writing an e-mail). positive effect on health and satisfaction and constitute a resource”.140 To strengthen workers’ rights to a say in the matter of working time and Occupational safety and health provisions, as laid down in the Safety and location, there is a general need for expanding the options available Of course, Work 4.0 offers Health at Work Act (Arbeitsschutzgesetz) and the associated ordinances, play ---» an important role in shaping specific working conditions. Risk assessments at the workplace level and under collective agreements, and for opportunities to better balance family must also be carried out to identify the risks of mobile working, enabling the broadening the circle of people who can make use of them, as well as a and work commitments. What is employer and works council to respond by adopting health and safety measures corporate culture of support for the use of these options in practice. The dangerous, in my view, is a recogniz- and workplace-level regulations. fact that workers have a need for ®exible working models which offer them able trend towards using the new greater options regarding the scheduling and length of their working forms of work solely to cut costs. « time, as well as location, e.g. home office, was set out in Chapter 2.5. » 5 May 2015 via arbeitenviernull.de

137 There can be exceptions in emergency situations. 138 See, for example, Federal Ministry of Labour and Social Affairs (BMAS) 2015c. 139 See, for example, Beermann 2004; Wirtz et al. 2009; Wirtz 2009. 118 140 Federal Institute for Occupational Safety and Health (BAuA) 2016a, p. 133, 136. 119 Policy Options Policy Options

Works agreements and collective agreements can not only outline Finally, there was a consensus in the Work 4.0 dialogue about the specific options and set out rules for their implementation, but also articu- need for negotiated working time agreements and flexibility compro- late workers’ entitlements vis-à-vis their employer. However, in view of mises. In this context, employers and human resources managers, as the decline in collective bargaining coverage and the large number well as some works councils, raised the question of whether, in light of of workers not covered by such approaches, e.g. because they work for digitalisation and workers’ changed needs, some of the existing provi- small companies, there is a question as to what extent individual enti- sions of the Working Time Act ought to be relaxed. However, objec- tlements should be strengthened. The limits of what is feasible for a tions were also raised, pointing out that far-reaching demands, such as company, in terms of organisation, costs and technical implementation, a shift away from a maximum daily working time to a maximum weekly must be recognised in this context. working time, could lead to a reduction in time sovereignty for workers and a greater risk of negative health impacts. The Working Time Act One fairly far-reaching approach that would strengthen individual already offers the possibility of derogating, by means of a collective entitlements in legal terms would be a Working Time Choice Act agreement, from the principle of an uninterrupted 11-hour rest period (Wahlarbeitszeitgesetz), as proposed by the German Women Lawyers after finishing work. The rest period can be cut to nine hours by means Association (djb) in a widely discussed paper. It would give all workers – of a collective agreement if necessitated by the nature of the work and including those in organisations where there is no co-determination – if equivalent compensatory rest periods are provided. guaranteed working time options. The core element of this approach is an individual entitlement for each worker to change his or her contractual SHAPING THE WAY AHEAD working time, in terms of length and scheduling, as well as his or her When it comes to protecting workers from overwork and a breakdown ---» Constant reachability means a working location. The company would only be able to refuse on urgent of the boundaries on work, and to balancing organisations’ flexibility high level of ¨exibility in where and when operational grounds. That said, this condition would be met if, for exam- requirements with workers’ desire for self-determination, collective work is performed. This touches on ---» To give workers scope to ple, a working time choice strategy had been developed in an organisa- agreements and works agreements seem the best means for tailoring co-determination in relation to work- enjoy greater quality of life and tion and the individual’s preferred working time was not compatible the implementation of statutory regulations to the situation on the ing time and the use of technology. working life, ver.di is also calling for a with it. The German Women Lawyers Association’s proposal is based on the ground (… box Legal Regulations). Employers and works councils and These are the areas where the most works right to telework. « concept of “regulated self-regulation”, i.e. the Act would stipulate proce- the social partners have already concluded pioneering agreements on agreements are being concluded. « United Services Trade Union (ver.di) dures, time limits and participatory rights, but it would be for the employ- the organisation of working time and flexible location working which Hans Böckler Foundation er and works council to determine the specifics.141 Another option would achieve this for individual sectors and organisations. » be a right to home office working, with free choice regarding the working location. In view of the large number of activities that remain tied to In a dynamically changing world of work, ergonomic research is a specific location, however, this “right” need not necessarily be an enti- needed into how high standards of workplace health and safety offered tlement which – provided that it does not conflict with operational inter- by the existing legal framework can be maintained in the face of changing ---» A legal entitlement for ests – is enforceable in practice. It has not been put into practice in the parameters or new forms of employment. Today, a wealth of university workers to “telework” from home is Netherlands or the United Kingdom, either, which are often cited as and non-university research is already being conducted into ergonomic unacceptable. Not all jobs are suited to examples of countries where a right of this kind has been implement- and occupational health questions, for example by the Federal Institute homeworking. This is especially true in ed. Workers in these countries are merely entitled to discuss their pref- for Occupational Safety and Health (BAuA), the research institutes of retail (e.g. sales assistants, shelf erence for homeworking with their employer, meaning that the instru- the German Statutory Accident Insurance (DGUV) or the Institute for stackers, etc.). « ment primarily provides a starting point for discussions at the Applied Occupational Ergonomics and Industrial Engineering (IfaA). German Retail Federation (HDE) workplace level. « However, broader academic research is needed alongside project monitoring and evaluation, so that the health impacts of flexible employment models can better be judged. Past research into strain and recovery

120 141 See German Women Lawyers Association (djb) 2015. 121 Policy Options Policy Options

related to working time has focused chiefly on industrial work and less • A reliable public infrastructure is necessary, especially for childcare on forms of work in the knowledge and service society, and has often and long-term care. Great strides have been made more recently, particu- neglected to look at work-life balance as a whole. To date, too little is larly in expanding and improving the quality of early childhood care. known about needs, requirements and strain in relation to knowledge However, action is still needed in relation to full-time care in schools ---» In the World of Work 4.0, people workers, for example, or those facing a three-fold burden in the form and long-term care. are playing a new, more active role in of working time, long commutes and family commitments. The Federal work in social, communicative and Ministry of Labour and Social Affairs is seeking to ensure that the Federal • In recent years, the further development of parental leave and the Act emotional terms. It is important to Government’s programmes give greater consideration to occupational to Improve the Reconciliation between Family, Caregiving and Work monitor, properly identify and conduct health research and research into prevention and health and safety in Responsibilities (Gesetz zur besseren Vereinbarkeit von Familie, Pflege research into these changes. « future. Health and safety at work must evolve, in the conditions of a und Beruf) have already created legal entitlements to family-related Institute of Industrial Engineering and Ergonom- transformed world of work, into an Occupational Safety and Health 4.0 reductions in working time. These entitlements were introduced with ics (IAW) at RWTH Aachen University strategy (… Chapter 4.4). « the aim of taking more of a life-phase approach to the organisation of working time. Regarding financial support for working time reductions The initiative to insert a general right to temporary part-time work in certain life phases, income reductions could conceivably be partially into the Act on Part-Time and Fixed-Term Employment (Teilzeit- und offset in cases where both partners work part-time, as provided for by Befristungsgesetz), which is anchored in the coalition agreement, is an the models of “family working time” or a “family benefit”.143 important step in boosting time sovereignty and moving towards working time choice . It enables workers to adapt their working time • Long-term accounts (referred to as “credits” (Wertguthaben) in to their current life phase, without falling into a “part-time trap” .142 the relevant legislation) can be used flexibly to allow workers to take Limiting unwanted part-time work is also an important contribution to time off work for purposes defined in legislation – such as care or making the most of the skilled labour pool and avoiding gaps in social parental leave – or for purposes agreed with the employer – e.g. security, especially in old age. To make transitions between full-time and continuing vocational training, sabbaticals, the transition into retire- part-time phases easier for workers, the coalition partners have commitment.144 They thus offer tailored solutions to many individual time ted to further developing the law on part-time work. This will ensure requirements. To boost the availability of long-term accounts , incen- that workers who choose to work part-time for a fixed period can later tives could be established to encourage SMEs, in particular, to set up return to their previous working time. To this end, an entitlement to credit schemes and make it possible for their workers to be released temporary part-time work is being created. from work for longer periods.145 In the event that it proves unfeasible to conclude inexpensive collective contracts with providers of credit The right to temporary part-time work should be supplemented by administration tools for SMEs, an alternative avenue could be for the further elements, however, as part of a move towards organising working German Federal Pension Insurance, to which credits can already be time in a way which takes life phases and circumstances into account. transferred if a worker changes employer, to administer the credits in agreement with employers and workers. The medium-term aim could

143 See Federal Ministry for Family Affairs, Senior Citizens, Women and Youth (BMFSFJ) 2016; Müller et al. 2015. 144 Credits are based on a free agreement between workers and employers. This system requires workers to be able to currently forego portions of their pay or paid time off work so that they can later be released from work for a longer period. Employers, for their part, must be willing and able to administer the credits or have them administered in such a way that they are protected in the event of insolvency, and to later release workers partially or fully from work for a longer period. See Federal Ministry of Labour and Social Affairs (BMAS) 2015e. 145 The chemical industry is a pioneer in this area, with its collective agreement on “Working Life 142 According to an analysis of German Socio-Economic Panel (SOEP) data currently being under- and Demographic Change”. A representative TNS survey of organisations in 2010 found that taken for the Federal Ministry of Labour and Social Affairs, of the estimated 6 million part-time long-term accounts are set up by just two per cent of organisations in Germany (Riedmann et workers (i.e. with a weekly working time below 30 hours) in 2014, almost 3 million would like to al. 2011). Usage is linked in particular to the size of the organisation: at 13%, the proportion 122 increase their working time – by an average of 11.3 hours per week (see Tobsch/Holst, 2016). accounted for by organisations with 500 and more workers was well above average in 2010. 123 Policy Options Policy Options

be for a long-term account to be opened for all workers at the start of to be developed with an open mind, and specific changes to be tested their working life. This account would offer a foundation for collective directly in practice (… Chapter 5). This idea should be expanded to also agreements and more far-reaching reforms, which are outlined in allow experimental spaces which make use of a relaxation of the Working Chapter 4.8. Time Act. The evaluation of this increase in flexibility must be based on clear criteria, above all whether the aims of health and safety at work and • The Flexible Pensions Act (Flexi-Rentengesetz) is intended, among time sovereignty are boosted by innovative flexibility arrangements. ---» In a project’s peak phase, a other things, to improve the possibility to supplement part-time work with specialist in the German organisation a partial pension before reaching the statutory retirement age. Older This Working Time Choice Act should contain the following elements: may need to take part in a coordination workers will be able to organise their transition into retirement in a meeting in the United States via tele- flexible, self-determined way reflecting their individual life plans. This Workers should have the right (in line with the aim of “temporary conferencing at short notice. If he has is an important contribution to a life-phase approach underpinning part-time work”), if certain conditions are met, and within certain time already worked for 9 hours in Germany the organisation of working time. limits, to choose the length of their working time. They should have a that day, then as the law stands he would right to discuss the scheduling of their working time, even if they do only be allowed to attend the tele- The existing legal framework already allows for a high level of flexi- not want to reduce their working time, and their place of work. Natu- conference for a maximum of one hour. bility (… box: Legal Regulations). Should greater organisational leeway rally, employers should also be able to discuss the scheduling of work- There should be a provision which prove necessary, e.g. regarding maximum daily working times and rest ing time and place of work with employees in the event that a worker allows more ¨exibility. « periods, the Federal Ministry of Labour and Social Affairs could only wishes to reduce his or her hours. Confederation of German envisage allowing this via negotiated flexibility compromises. These Employers’ Associations (BDA) compromises would have to fulfil certain conditions (see below). They A conditional, limited derogation from the Working Time Act’s current would have to facilitate tailored solutions without limiting workers’ provisions on the maximum daily working time and rest periods should ---» If an employee quickly answers time sovereignty or occupational health. The Ministry takes the view be possible, at the worker’s or employer’s instigation, if the following a few emails in the evening on the that a general relaxation of the Working Time Act, such as a move away conditions are met: train home after coming out of the from the standard of the 8-hour day in favour of a maximum weekly cinema, it must be possible for her to working time, is incompatible with the aims of health and safety at • A collective agreement must permit this relaxation of the law, can limit start work again at 8 o’clock the next work and time sovereignty. « it to certain groups of workers, and define more specific requirements for morning. That reflects reality and the working time choice at the workplace level. expectations of many people, especially In the medium-term, these aims (protection from overwork and a young people. « breakdown of the boundaries on work , time sovereignty , negotiated • A works agreement about working time choice must be in place. At a Confederation of German flexibility compromises) could be enshrined in a new Working Time minimum, this must include clear rules on the recording of working time Employers’ Associations (BDA) Choice Act (Wahlarbeitszeitgesetz). This Act could combine more and the conducting of risk assessments. options for workers in relation to working time and location with a conditional possibility to derogate from the applicable provisions of • The employees concerned must also give their individual consent to the Working Time Act (… box: Legal Regulations). The derogation this relaxation of the law. should initially be limited to two years, during which it should be trialled in specific experimental spaces in organisations (… Chapter 5), • This relaxation of the law must be tied to organisations’ willingness to as proposed by the IT Summit’s platform on the “Digital Working evaluate, or arrange for others to evaluate, the resulting impacts and to World” with regard to flexibility in working time and location. The joint make the findings available to the Federal Government. The implemen- recommendation is that experimental spaces should be set up at the tation of this increase in ®exibility must go hand in hand with new protec- workplace level to allow new working time and organisational models tive rights. For example, this could mean that the statutory maximum ten-ho ur daily working time may be exceeded twice at most, provided

124 125 Policy Options Policy Options

that this does not lead to the worker exceeding the average maximum Given the immense significance of working time legislation for health weekly working time of 48 hours, and that the worker is given a day off and safety at work, it seems advisable to place a time limit on the no later than the following week. In any case, the existing reference opening clause allowing a relaxation of the law, in the spirit of “policy periods, over which an average of eight hours per working day may not learning”. The clause would be evaluated by the Federal Institute for be exceeded, should be defined much more narrowly. Occupational Safety and Health (BAuA) regarding the issues of time sovereignty and health and safety at work. The outcomes of the experimental spaces should be analysed after two years to identify, among other things, innovative compromises between SUMMARY the social partners and at workplace level, and the impacts on job satis- • Digitalisation offers the opportunity for greater self-determination faction and health and safety at work. As a next step, the outcomes could in the World of Work 4.0. However, a balance must be struck between potentially be enshrined as permanent provisions in the Working Time conflicting interests and aims. Legally enshrined protection from over- Choice Act and the Working Time Act. work and a breakdown of the boundaries on work is essential. At the same time, there is a growing need for self-determination and time A Working Time Choice Act could help to create incentives for the sovereignty. Negotiated working time models and flexibility compro- negotiation of innovative working time arrangements which are tailored mises are thus becoming more and more important. to the conditions in the individual organisation and are based on the general principle of “flexible, but self-determined”. This approach also • The organisation of working time cannot be separated from human reflects the fact that the opportunity of “working time choice” cannot be resources strategies, performance appraisal criteria and management separated from an organisation’s human resources policy and leader- cultures. New technologies can also contribute to flexibility in working ship culture. How is it ensured that (temporary) working time reduc- time and location. Innovative approaches in collective agreements and tions do not result in work intensification ? How are temporary gaps at firm-level should therefore be developed and, where appropriate, in staffing plans dealt with? Are unnecessary requirements to be present trialled in experimental spaces (… Chapter 5). in the workplace called into question? How can part-time work for senior staff be supported? Are skills and information shared between staff so • To make better use of the skilled labour pool and prevent workers they can stand in for each other? Ultimately, these questions can only from becoming caught in a “part-time trap”, a general right to temporary be answered at workplace level and in the dialogue between the social part-time work will be anchored in the Act on Part-Time and Fixed- partners and between employers and works councils.146 Term Employment (Teilzeit- und Befristungsgesetz), as provided for in the coalition agreement.

• Other starting points for more of a lif e-phase approach to the organisation of working time are wider use of long-term accounts, a further expansion of public infrastructure in the field of childcare and long- term care, and more self-determined transitions into retirement.

• A more far-reaching reform would be a Working Time Choice Act (Wahlarbeitszeitgesetz), which would combine more options for workers in relation to working time and location with a conditional possibility to derogate from certain provisions of the Working Time Act, on the basis of an agreement between the social partners and at firm-level. This Act should initially be introduced for a two-year period and trialled in experimental spaces.

146 The importance of workplace-level factors in the acceptance and uptake of working time options is shown, for example, by the findings of the “Working time options over the life course” research 126 project, Klenner/Lott 2016. 127 Policy Options Policy Options

4.3 THE SERVICE SECTOR: FOSTERING ISSUES RAISED IN THE CONSULTATION PROCESS The evolution of digital platforms was an issue which permeated the ---» The European Commission’s GOOD WORKING CONDITIONS entire consultation process, even beyond the concrete effects on the plan to boost the sharing economy world of work. It became clear that platforms can primarily offer visible should be opposed, because Uber & co. benefits for customers, such as greater efficiency, lower prices, addi- are attacking good standards in the ---» Over 70% of employment is Although the German debate on digitalisation is being shaped in par- tional choice and easier access. However, criticism was voiced of the field of passenger transport, for now in the service sector. The focus ticular by the vision of “Industry 4.0” , the transformation is affecting trend towards monopolies, which can also have the opposite effect. example, resulting in a deterioration must be on growing, forward-looking all sectors, albeit at different paces and with varying degrees of intensity. It was also argued that platforms have a tendency to foster price wars, in service. « sectors and, accordingly, it is important Many sectors, such as the media, retail, finance, the trade sector or as information about quality was often overshadowed by price tags in via arbeitenviernull.de not to develop the strategies for logistics, have long been confronted by digitalisation, and the effects online comparisons. » “Work 4.0” by taking industry as the are already being clearly felt. « starting point. To achieve “good work” In addition, concerns were voiced that “on-demand services” are pri- ---» The temporary agency workers for as many workers as possible amidst A strong and competitive manufacturing sector will remain the major marily resulting in lower-paid employment with little social protection. and contract workers on the periphery the digital revolution, it is essential to foundation for innovation, productivity and skilled employment in future. As a consequence, the labour market could split further into core and of the core workforce could be joined place the transformation processes in At the same time, services relating to industrial production and products peripheral workforces or high-paid specialists and low-paid crowd- by a swarm of new service providers in the social service sectors, in particular, are emerging in new value networks. The “Labour Market 2030” employ- workers . The decline in collective bargaining coverage is another new forms of work based on solo self- centre stage. « ment forecast is predicting growth mainly in the area of business-related relevant factor in this context. There is a “customer dilemma” here: many employment and digital “day labourer” United Services Trade Union (ver.di) services and the social services sector (… Chapter 2.1). « consumers want to enjoy the benefits of the services offered via digital work. « intermediaries without necessarily fuelling a deterioration in working Bremen Chamber of Labour ---» The care work sector will have Particularly against the background of rising female employment and conditions. Without sufficient information, however, they cannot make to expand more rapidly in future in societal change, the care sector offers significant employment oppor- an informed choice. » order to relieve the pressure on working tunities. Demand will continue to rise, especially in the fields of child- women, in particular, who often take care, long-term care and household-related services. A good and afforda- At times, the trends of sharing, crowdfunding and collaborative com- on the greatest burdens in terms of ble supply of care services is therefore also an important contribution to mons were described – sometimes with reference to more visionary family care work and housework, e.g. securing the skilled labour base, as it relieves workers of the burden of ac ademic contributions from the international debate148 – as elements childcare, long-term care and support carrying out the tasks in question. As there is limited potential for ratio- of an economic approach which is regarded as an alternative to mono- for older family members, and other nalisation in these occupations, they constitute an important field of poly platforms (… Chapter 2.2). key elements of family work. « employment.147 Association of German Cities There is a broad consensus that potential for additional employ- ---» Particularly in the service sector, However, even services which are at relatively low risk of automation ment exists, particularly in childcare, health, long-term care and social working conditions sometimes exist are affected by digitalisation: platforms are already acting as interme- occupations, as mentioned above. However, the working conditions are which are far removed from “good work”. diaries for many services today. This trend can be expected to continue. regarded as problematic, in particular the level of pay, which often [...] Steps to improve the conditions of does not allow for any private provision against social risks. Political employment in the service sector will action is deemed necessary both to improve pay structures and in therefore also be necessary. « terms of the value which society places on care work. Thus the visible Social Sciences Institute of the employment potential in these areas is in itself not a guarantee of Evangelical Church in Germany quality jobs work. Instead, long-term financing of adequate wages will be necessary to create a personal service sector which is ÿt for the future. »

128 147 Hipp/Kelle 2015. 148 See Rifkin 2014. 129 Policy Options Policy Options

---» To secure a qualified skilled The market can undoubtedly bring about a certain amount of pro- In response to the “customer dilemma”, the dialogue between busi- ---» In principle, employers in the labour supply in the health sector, gress in this area. Trends in productivity and in supply and demand play nesses, consumer institutions, trade unions and policy-makers should metal and electrical engineering indus- innovative incentives are needed a crucial role in determining wage trends, as do collective bargaining be continued.149 In the jungle of opaque value creation processes and tries are committed to transparency, via new pay structures. « coverage and society’s willingness to facilitate good wages for skilled complex terms and conditions, customers should be able to find out sustainability and responsible econom- Association of German Cities services. While digitalisation itself can, via productivity gains, lead to what working conditions apply to services provided via digital interme- ic activity, but oppose any trend to- rising wages in the services sector, these possibilities are relatively diaries. Transparency should not apply solely to prices and diversity of wards monitoring of companies by ---» Ver.di is pressing for service limited in the field of labour-intensive personal services. New business supply. Platforms could provide reliable information about quality- consumers (outside the existing legal activities to be upgraded, as this is a models and an optimisation of work processes can contribute to an related issues, such as vocational training and other qualifications, framework), let alone the publication of key building block for the future of upgrading of occupations here, and in this context, public co-financing specialist knowledge, experience, etc. and, not least, offer transparent sensitive corporate data. « work and social justice. [...] of socially necessary services may be a sensible approach. It leads to information about working conditions and social protection. Only then Gesamtmetall – Federation of German Employers’ Associations in the Metal and Electrical Engineer- Political messages are needed which better wages and opens up new employment opportunities. It is also, can consumers properly weigh up the prices and services offered and ing Industries place as high a value on work with in principle, a legitimate and tried-and-tested approach for public help to promote good working conditions by taking informed decisions. people as work with machines. « p olicy to specifically develop and support areas or sectors where there More debate is still needed on whether certifications or quality labels, United Services Trade Union (ver.di) is an overarching public interest and where market mechanisms are not at least on a voluntary basis, would be a possible answer, or whether functioning properly. « other solutions entirely are conceivable. » ---» Even more robots ought to be “employed”, so that people can do SHAPING THE WAY AHEAD The question of whether digital platforms require a new regulatory more skilled work and receive better The design of service markets and the development of business and framework has been raised by the Federal Ministry for Economic Affairs support, especially in physically organisational models in the service sector only partially fall within and Energy in a Green Paper of its own.150 In order to maintain an demanding work (e.g. in the policy-makers’ remit, and the Federal Ministry of Labour and Social SME structure in service markets and the trade sector and thus to safe- long-term care sector). « A ffairs, for its part, has limited power to shape parameters in this area. guard value creation, investment and regular taxation in Germany, one 22 Apr. 2015 via arbeitenviernull.de Nonetheless, several general principles can be identified from the option in certain sectors would be for companies working together on dialogue. Firstly, digitalisation can boost productivity in the service joint platforms to reach out to customers. Likewise, companies and sector and thus facilitate higher incomes. Innovations of this kind self-employed workers could maintain a joint digital platform, which should be supported. Secondly, thought should be given to how busi- would have the competitive advantage of being especially attractive for ness models could be designed that would boost SMEs’ competitiveness potential customers by offering quality jobs and fair pay. Various models ---» “Good services” can not only compared to monopoly platforms and at the same time take the social can be envisaged in this context. specifically enhance working condi- market economy approach and pursue the vision of quality jobs in the tions, but also improve living condi- digital age. Thirdly, working conditions should be made more attractive, One option is the old idea of a cooperative, which can take on new tions and promote public welfare. especially in the care economy and socially necessary services, while significance in the context of digitalisation.151 While many of the new Productivity gains should be redirected giving all individuals access to these services. Reducing undeclared work digital platforms are financed via venture capital and face corresponding to areas of societal need, in particular... in favour of jobs with compulsory social insurance coverage remains an return expectations, a cooperative would be something like SME In the medium term, the focus should important goal in this context. Fourthly, and most importantly, it is vital “crowdfunding”. Cooperatives, whether as communities with shared be on promoting and supporting inno- to increase collective bargaining coverage in the service sector and vations which generate jobs « especially in the care sector and, looking to the future, to achieve a United Services Trade Union (ver.di) generally binding collective agreement for the social sector. «

149 As part of the Work 4.0 dialogue, the Federal Ministry of Labour and Social Affairs and the Fed- eral Ministry of Justice and Consumer Protection held a discussion with stakeholders at a joint event on 20 September 2016 about the conditions in which socially just and consumer-friendly standards can be achieved in the field of physical services provided via digital intermediaries: https://www.bmas.de/DE/Presse/Meldungen/2016/symposium-dienstleistungsplattformen- internet.html 150 Federal Ministry for Economic Affairs and Energy (BMWi) 2016. 130 151 Theurl 2015; Scholz 2016. 131 Policy Options Policy Options

values or “merely” shared economic interests, lend themselves as an deductions when filing a tax return. The credit in the account could be alternative organisational model for centralised platforms, including in used to pay social insurance contributions, or flat-rate contributions in the sharing economy . On this question, too, the Federal Government the case of mini-jobs. When purchasing a service via an agency, a share must intensify its dialogue with businesses and society. of the costs could be paid using the account. If a household employs people in jobs with compulsory social insurance coverage, the service One concrete option – which also reflects the aim of a digital public provider could, in line with the aim of a modern, digital administration, administration responsive to public needs – exists in the field of house- organise the household’s notification obligations and the payment of hold-related services. In Germany, much of the strong and growing social insurance contributions and potentially also income tax. Funding demand for household-related services is met outside the legal frame- would also be provided for the employment of solo self-employed work. It is estimated that in 2015 around 80 per cent of domestic work- individuals , provided that they are covered by social insurance. Social ers were not in a legal employment relationship.152 insurance contributions would then be collected via the service provider. This also applies to platforms which act as intermediaries for self-em- ---» Financial support for house- Targeted co-financing can make household-related services an ployed work. It would be sensible to begin with a pilot scheme to trial hold-related services is one way of re- accepted field of employment for low-skilled people, with compulsory this model in a major city or region, to determine its effects on the ducing the burden on families. social insurance coverage. These services are funded by the state in labour market and fiscal impacts. However, expanding these activities many countries for this reason. In addition, they can make a major contri- must not lead to the consolidation of a bution to allowing a better balance between family and work commit- precarious service sector, but instead ments. This could also allow previously unpaid work, often performed SUMMARY reflect the principles of “good work”. « by women, to move into the sphere of paid work.153 In view of demo- • Digitalisation is having a special impact on service industries. Not Forum for Progressive Family Policy (ZFF) graphic trends and the possibility that digitalisation may result in low- only is it affecting the activities themselves, it is increasingly also lead- skilled jobs disappearing in some sectors, the labour-market, social and ing to them being provided via platforms as intermediaries. A critical finance policy arguments for funding household-related services must discussion is taking place about the trend towards monopolies in these be reassessed. « service markets. The core of this proposal is that existing forms of support should be • For customers, platforms can have significant benefits. At the same readjusted and targeted assistance provided for households in fulfilling time, there is a risk that they can lead to a deterioration in working their obligations as employers. To this end, the existing tax deduction conditions. This “customer dilemma” should be countered by measures options could be converted into a household services account, which including an agreement on social standards between businesses, con- the German office managing “mini-jobs” could administer, for example, sumer institutions, trade unions and policy-makers. alongside the existing “household jobs exchange”. Alternatively, private service providers could be tasked with this role. Low-income house- • In order to maintain the SME structure in service markets, companies holds in need of support would also benefit more from the establish- could work together to build joint platforms to reach out to customers. ment of a credit system than they currently do from applying for tax Cooperatives could offer a suitable organisational form for this.

152 Enste 2016. 153 To date, the rise in female employment has not been accompanied by a redistribution of unpaid care work between men and women. Although the female employment rate has risen to over 73 per cent, women continue to perform a much higher share of unpaid work than men: according to the Federal Statistical Office’s 2012/2013 time use survey, two-thirds of the 132 work performed by women is unpaid, compared to just under half for men. 133 Policy Options Policy Options

• Collective bargaining coverage should be increased in the service and 4.4 HEALTH AT WORK: APPROACHES FOR care sector and, looking to the future, should lead to a generally binding collective agreement for the social sector. OCCUPATIONAL SAFETY AND HEALTH 4.0 • The importance of the care sector will continue to grow. Attractive working conditions are particularly necessary in this area. Public co- Germany has a long tradition of humanising the world of work. An ---» I believe it is important to financing is useful in the case of socially necessary services delivered by activity is regarded as “humane” if it does not have a negative impact reduce psychological strain and the private sector. For household-related services, a new model of a on workers’ health, wellbeing, and performance capabilities. Both the cushion the effects of time pressure. household services account and digital administration would be a suit- Occupational Safety Act (Arbeitssicherheitsgesetz) and the Safety and To achieve this, however, one thing able approach to support households. Health at Work Act (Arbeitsschutzgesetz) enshrine the principle that first needs to change: our philosophy work should be designed in accordance with human needs: effective of life. « health and safety standards at work are key to preventing negative 21 Apr. 2015 via arbeitenviernull.de health impacts. Yet health is not merely the absence of disease.154 Thus, a job can only be regarded as humane if it reflects the worker’s skills, allows individual potential to be realised and individual competencies to be developed155, and in this way contributes to the worker’s physical, mental and social wellbeing. »

ISSUES RAISED IN THE CONSULTATION PROCESS The consultation process showed, on the one hand, that the digital and technological transformation may not only help foster health and safety in the workplace, but also help to create more humane working environments in the broader sense. “Gute Arbeit”, approaching the ideal of a humane activity, could be available to more people than in the past. Adaptive assistance systems and robots are today already taking on physically demanding, hazardous and monotonous tasks. Workers could thus have more time in future for the creative, manage- ---» In the case of solo self-employ- rial and interactive aspects of their work. ment – as well as telework and mobile working – greater flexibility initially On the other hand, the dialogue also made clear that demands facing results in more working time sover- workers in the digital transformation are changing rapidly, as the number eignty. However, the positive effects of activities dominated by cognitive, information-related and emotional associated with this can often go hand factors is steadily rising. In many occupations, a shift is taking place in hand with work intensification or from physical to primarily cognitive tasks. Then there are overarching a breakdown of the boundaries on work, trends such as the breakdown of the boundaries between private and with corresponding negative impacts working life, work intensification, greater flexibility and mobility . All on the worker’s safety and health of these were discussed not only in terms of the opportunities they offer, (physical and mental health risks, but also in terms of the risks they pose. For, although the causes are accidents, incapacity for work). « primarily rooted in a combination of personal resources and changing German Statutory Accident Insurance (DGUV)

154 World Health Organization (WHO) 1946. 134 155 German Ergonomics Society (GfA) 1999. 135 Policy Options Policy Options

---» Regarding the issues relating to working conditions, it is clear that there has been a sharp rise in mental Against this background, some responses to the Green Paper recommend ---» At present, there is a shortage “work intensification”, the employer illness in recent years, in parallel with the progressive transformation that occupational health research should be boosted significantly. » of research on the psycho-social trends must not be held solely and prema- of the world of work.156 Mental illness is one of the main causes of reduc- in the digitalisation of the world of turely responsible. It is impossible to tion in earning capacity and early retirement. Since 2004, the number of SHAPING THE WAY AHEAD work and the impacts in terms of occu- generalise about whether the percep- days lost due to mental illness has increased by almost 72 per cent, and The Joint German Health and Safety Initiative (Gemeinsame Deutsche pational health. More needs to be known tion of work intensification is due to in 2015 periods of absence due to mental illness were, at an average of Arbeitsschutzstrategie, GDA) is the nationwide platform for health and about the causes of psychological strain external influences or certain types of 25.6 days, more than twice as long as the general average of 11.6 safety at work, supported by the Federal State, the Länder and occupa- induced by the digitalisation of the behaviour on the part of the worker. « days.157 This rise is due to both an actual increasing prevalence of men- tional accident insurance funds. It is the foundation for transforming the working world, and its effects on physi- Association of German Chambers of Commerce tal illnesses, improvements in diagnosis, and a decline in the social occupational health and safety system along the lines sketched above. cal and mental health. It would be and Industry (DIHK) stigma attached to it.158 The costs borne by individual social insurance The stakeholders in the GDA seek to ensure that a long-term prevention useful to have a digital platform setting agencies, the state and also employers are immense. « policy is pursued at all levels of the occupational health system, and out the interim and final results of practical improvements are achieved for workers in terms of health and research projects on the digitalisation ---» In the world of Work 4.0, there The present challenge is to adapt health and safety at work and occu- safety at work. In this context, they coordinate with the social partners of the working world in a systematic will continue to be risks caused by pational health care in light of not only the digital transformation, but and other stakeholders, such as the health insurance funds. Occupa- and comprehensible form. « both mental (e.g. monotony, overwork, also demographic change, the effects of which are increasingly being tional Safety and Health 4.0 is already on the agenda: one GDA aim is to Conference of the Labour and boundaries) and physical factors felt. To this end, it will be necessary to ensure that psychological strain protect and improve health in relation to work-related psychological Social Affairs Ministers, Work 4.0 Working Group (e.g. noise, hazardous chemical and is a greater focus in the work of all occupational safety and health strain. The Work 4.0 dialogue is taking up this aim. However, in contrast biological substances, physical stakeholders. Building on the “Vision Zero Strategy” to prevent fatal to the case of hazardous substances, for example, the approach cannot ---» Reducing work-related health demands and physical inactivity). (...) and serious work-related accidents and diseases, the traditional instru- be to minimise psychological stress across the board. In the past, many risks caused by psychological strain is In the context of an ageing workforce ments of health and safety at work should also be developed further to humanisation projects have actually increased the demands on workers undoubtedly a challenge in the field of and new forms of work, these risks are create an encompassing approach for “Occupational Safety and Health 4.0” by enriching and expanding the content of their work in order to make it health and safety at work; however, this leading to major challenges for preven- (… Chapter 4.2). Company doctors are already making an important more interesting, varied and thus more humane. In the organisation of can only be addressed effectively if the tion and occupational health. « contribution to this, as they provide qualified advice on the interactions work, it is essential to avoid forms of working time, workflow, commu- facts are known. When it comes to German Society for Occupational and Environ- between work and health and on integrated occupational health strategies. nication and collaboration which place undue psychological strains on health and safety at work, a clear mental Medicine (DGAUM) To improve the available human resources, the Federal Ministry of Labour workers. In view of the increasing flexibility regarding working time distinction must be made between and Social Affairs supports the Action to promote young professionals in and location, however, greater demands will also be placed on workers’ work-related and personal causes, and ---» Occupational safety and health the field of occupational health (Aktionsbündnis Arbeitsmedizin). « individual responsibility and health literacy. in practice this is immensely difficult. legislation alone will therefore not be (...) The current state of knowledge enough in light of the transformation Occupational health care is a good instrument for educating and concerning cause-and-effect relation- of value creation. « advising workers about individual health risks in their work. Alongside ships is largely inadequate, which poses German Statutory Accident Insurance (DGUV) the need to enhance health literacy, it is important, above all, to retain a significant problem, not least for the the priority of circumstantial prevention as a fundamental principle in development of procedures to assess occupational safety and health in the digitalised world of work. psychological strain; this is a problem for which it has proved impossible to ÿnd a satisfactory solution for decades. « Gesamtmetall – Federation of German Employers’ Associations in the Metal and Electrical Engineering Industries

156 Böhm 2016. 157 Badura et al. 2016. 136 158 Federal Institute for Occupational Safety and Health (BAuA) 2015. 137 Policy Options Policy Options

These issues must in future be placed at the heart of health and safety • Developing executives’ skills with regard to changing working at work. A key element of the GDA’s programme on work-related psycho- conditions. logical strain is therefore to inform and upskill in-company and external health and safety stakeholders in this area. The Federal Ministry of Labour • Preparing supervisors to deal with a wider spectrum of issues (e.g. the and Social Affairs will seek to ensure that the GDA’s programme to growing importance of psychological strain) and placing clearer protect and improve health with regard to work-related psychological emphasis on advice and support rather than checks and sanctions. strain is continued beyond 2018. In addition to establishing a modern occupational safety and health Furthermore, the Ministry is helping to lay the scientific basis for the system, the Federal Government should investigate digitalisation’s occupational safety and health system of the future. For example, the impacts on working conditions in experimental spaces (… Chapter 5) Federal Institute for Oc cupational Safety and Health carried out a wide- with a view to developing innovative approaches. The aim – continuing ranging research project studying and assessing the current state of in the tradition of earlier such programmes – should be an interminis- knowledge (including measurement standards and practical feasibility) terial innovation, research and transfer strategy for labour research on factors with harmful or beneficial impacts on health.159 Initial results (… Chapter 5). suggest that the following four areas have a major influence on mental health in the world of work: the nature and organisation of activities; The Federal Ministry of Labour and Social Affairs will continue, with the duration, scheduling and distribution of working time; management the “Mental Health in the Working World” (psyGA) project which has and organisational structures, and technical factors. In addition, the been supported as part of the New Quality of Work Initiative (INQA) project’s results show that it is essential to look both at factors with a since 2009, to ensure the reliable transfer of state-of-the-art knowledge beneficial influence on health (resources) and factors with a harmful about mental health into concrete practice in organisations. Workers’ influence on health (stressors). Greater attention should also be paid knowledge, literacy and perspectives are becoming more and more impor- to the interactive work required by many occupations and the associated tant in ensuring that organisations are fit for the future. INQA will emotional strain, and the dynamics between work and other spheres of therefore focus even more on providing professional support for partic- life. Phases of mental stress or illness experienced by individual workers ipation-oriented change processes. This includes the “Sustainable Corpo- should not be pathologised. In light of these ÿndings, a modern system of rate Culture” audit (Audit „Zukunftsfähige Unternehmenskultur“) and Occupational Safety and Health 4.0 should include the following elements: the SME advisory programme “Corporate Value: People" (unterneh- mensWert:Mensch, uWM). The audit is the first service of its kind which • An adaptation of safety strategies in the light of new technologies, is supported by employers’ associations, trade unions, chambers, the e.g. human-robot collaboration. Federal Government, the Federal Employment Agency and the Länder. It enables companies and administrations to obtain a holistic picture of where • Advice and support for senior staff and workers in relation to work they stand with respect to upcoming challenges. The uWM programme, from flexible locations. co-financed by the European Social Fund, specifically supports SMEs by providing professional advice in developing a modern, staff-oriented • Fostering a sustainable culture of prevention in organisations, in human resources strategy. close cooperation with the relevant departments.

• Further training and empowerment of workers to ensure they are better prepared to take on an increasing personal responsibility for their own health.

138 159 Federal Institute for Occupational Safety and Health (BAuA) 2016b. 139 Policy Options Policy Options

If digital and demographic change is viewed from the perspective of One possible approach to account for these external effects would be to securing the labour supply, clear incentives emerge for companies to develop incentives for organisations which invest in maintaining employ- invest in good working conditions, which enable their employees to ability and good health. Well-designed economic incentive structures participate in working life for longer, in good health, with skills and can be effective catalysts for necessary changes at workplace level strong motivation. This is because, firstly, the demand for qualified and beyond statutory minimum standards.163 flexible skilled workers will rise due to digitalisation and technological progress. Secondly, much of the pool of skilled labour will be exhausted To accelerate the introduction of technologies and assistance in the near future as a result of demographic change. Traditional levers, systems with a positive health impact, a support programme for such as targeted investment in the education system, a modern approach SMEs is conceivable. to the recruitment of young people, and the mobilisation of groups who have previously been at a disadvantage in the labour market, are SUMMARY important but no longer sufficient to meet future demand for skilled • Health and safety at work must be adapted in light of not only the labour. Nor will skilled migration be able to fully compensate for the digital transformation, but also demographic change, the effects of shortage.160 Consequently, maintaining individual employability will which are increasingly being felt. To this end, it will be necessary to focus be of immense importance. more on the psychological strain of work, alongside its physical demands.

Although some companies are setting a good example, on the whole • The Federal Ministry of Labour and Social Affairs will therefore seek not enough is being done so far to address the challenges of a changing to further develop health and safety instruments into an “Occupational working society. For example, while there has been a decline in acci- Safety and Health 4.0” strategy. As part of this, the Joint German Health dents at work over the past two decades, the number of days lost due to and Safety Initiative’s programme to protect and improve health in rela- mental illness has increased steadily. Moreover, the average length of tion to work-related psychological strain will be extended beyond 2018. absence is much longer than for physical illnesses and has undergone a marked increase in recent years.161 • In addition, the Federal Ministry of Labour and Social Affairs will contribute to the development of an interministerial Work 4.0 innovation, It is unclear whether the necessary investment in good working con- research and transfer strategy. The New Quality of Work Initiative INQA, ditions at the workplace level is being held back by a lack of informa- in particular, will continue to ensure in future that knowledge and inno- tion, a deliberate or unconscious externalisation of responsibility, or the vations are properly transferred and implemented in practice. cost of relevant measures. What is clear is that companies with working conditions which are particularly beneficial for health and learning are not only investing in their own competitiveness, but are also reducing the burden on the social security systems and thus, ultimately, other employers as well.162

160 Vogler-Ludwig et al. 2016. 161 Badura et al. 2016. 140 162 Eichhorst 2016. 163 Elser et al. 2010. 141 Policy Options Policy Options

4.5 EMPLOYEE EMPLOYEE DATA PROTECTION – FROM THE FEDERAL DATA PROTECTION ACT TO THE EUROPEAN GENERAL ---» Progressive digitalisation DATA PR OTECTION: DATA PROTECTION REGULATION means employers are able, in principle, An intensive debate about specific rules for the protection of employee data to monitor their employees in almost S AFEGUARDING has been taking place in Germany since the entry into force of the Federal Data all respects. One example of this is the Protection Act (Bundesdatenschutzgesetz) in 1977. One result of this debate was ability to analyse log-in data: who HIGH STANDARDS Section 32, with which the 2005 Grand Coalition anchored employee data protec- worked on a patient’s file when, at which tion in the Act for the ÿrst time. The fact that, so far, no more far-reaching, differentiated regulations on employee data protection have been adopted which would workstation, for how long, and what have settled the debate is not due to a lack of political will (several governments was the content? Furthermore, the More and more people are using digital devices and applications in have published drafts); rather, it has proved impossible so far to find a viable Marburg Federation is observing that their work, generating growing quantities of personal data, which can be compromise which would have articulated and balanced the various interests ---» Data protection is an important uniforms are increasingly being collected, stored, and analysed. The mixed implications of Big Data well enough to command the necessary majority support. The rapid pace of issue in the era of digitalisation! « technological progress has contributed to the difficulty by creating more and equipped with RFID technology. This (… Chapter 2.3) also apply with regard to employee data. On the one 10 Mar. 2016 via arbeitenviernull.de more new needs for regulation, as has the complexity of the subject. » makes it relatively simple to generate a hand, it promotes the optimisation of workflows, business efficiency detailed proÿle of workers’ movements. « gains, the monitoring of performance, quality and success in the work- This does not mean, however, that employee data is poorly protected in Ger- Marburg Federation of Doctors (MB) place, occupational safety and health, and continuing vocational educa- many: the general principles enshrined in German data protection legislation, such as purpose limitation , data minimisation , the transparency requirement , tion and training. On the other hand, it also paves the way for a compre- Awareness of data protection necessity and proportionality , naturally also apply to the handling of employee ---» ---» We need a system of employee hensive, permanent monitoring incompatible with privacy rights. This is data. But in some respects there is a lack of legal certainty and clarity: the legal will need to be boosted in the digital data protection which reflects the also one of the fundamental legal conflicts surrounding employee data framework for employee data protection is provided by the interaction of many world, both among the public as a whole digitalised world of work. For example, protection: the need to strike a balance between companies’ legitimate provisions and principles at European, national and international level, and it and among employers and workers. One has been developed further over the decades by court decisions which are “in solutions must be offered for a work- interests in relation to the protection of their property, the monitoring helpful factor in this is more detailed some cases difÿcult for the workers concerned to understand”.167 In addition, from 164 able approach to data protection of employees’ performance, and adherence to compliance rules , on the May 2018 a new, single legal framework for data protection will apply in all EU regulations on employee data protection allowing a distinction between work one hand; and the rights of workers to informational privacy on the Member States in the form of the European General Data Protection Regulation . which offer legal certainty and an activities and personal lives. « other, which was formulated by the Federal Constitutional Court in 1983 This has many advantages (… Chapter 2.3), but the necessary implementing appropriate balance of interests. « legislation will initially complicate the legal situation at national level further. 165 » Daimler AG as a general principle for data protection. « German Bishops’ Office The European General Data Protection Regulation contains an “opening ---» Forward-looking regulations to The protection of employees’ data is particularly sensitive because clause” in relation to employee data protection which empowers Member protect employees’ data must their dependence on their employers places them in a vulnerable posi- States to issue more specific rules on data processing in the employment context.168 The German Federal Government was among those who pressed for the guarantee workers’ privacy rights, tion. Factors such as the requirement to obtain consent from individuals inclusion of this opening clause. but should also take into for the processing of their data in the work context, and the structural consideration employers’ interests imbalance in employment relationships, must therefore be taken into To adapt German legislation, a “Data Protection Adaptation and Implemen- in the use of data. « consideration. For this reason, companies’ scope for action is limited by tation Act EU” (Datenschutz-Anpassungs- und Umsetzungsgesetz EU) is currently being drafted. The Federal Data Protection Act in its current form is to be Conference of the Labour and the collective right to co-determination in relation to technical devices replaced, but the relevant section for employee data protection, Section 32, which Social Affairs Ministers of the Länder (Section 87 (1) no. 6 of the Works Constitution Act (Betriebsverfassungs- gesetz)). This provision is becoming increasingly important, as most activities are now performed using digital devices which are covered by this provision.166

164 Thüsing 2014. 165 Papier 2012; Simitis 2016. 167 German Bundestag, Printed Paper 17/4230. 142 166 Wedde 2016. 168 Däubler et al. 2016. 143 Policy Options Policy Options

---» Companies require legal regulates “Data collection, processing and use for employment-related purposes”, behaviour, from work at a desktop computer to the use of company or ---» The level of monitoring in many certainty, on the one hand, and flexi- is to be retained. The tried-and-tested approach of regulating data protection at official smartphones, data glasses or data gloves;170 thirdly, applications workplaces is frightening for those the workplace level in works agreements will also remain possible. This initially bility for their day-to-day operations, capable of analysing workers’ personalities in order to evaluate them or aff ected. The line between controlling creates certainty, because although the general legal framework is changing, the on the other. It is therefore essential to specific standards of protection for employees are not. However, a detailed ex- predict their future behaviour, for example speech analytics or analysis and an inappropriate level of moni- maintain the scope for practical amination is still needed into whether the new general principles in the EU of corporate social networks.171 » toring is blurring. The Women’s Rep- solutions to be created via works agree- General Data Protection Regulation will have an impact on employee data pro- resentation in the Social Insurance tection in Germany. In several areas, the Regulation will raise data protection ments or via consent from employees Existing law already sets a series of standards against which the legal- System Trade Union is greatly standards even without further implementation in Germany, for example as for their data to be processed. In addi- regards rights of the data subjects. « ity of such applications must be measured. The collection, processing, and c oncerned by this development. « tion, the international transfer of data use of data for employment-related purposes is permitted if it is neces- Social Insurance System Trade Union – Women’s Representation needs to be improved, in particular by Designing a system of employee data protection that accounts for ongoing sary for hiring decisions or, after hiring, for carrying out or terminating digitalisation processes and goes beyond the existing Section 32 of the Federal making it easier to transfer data the employment contract. In other words, the handling of employees’ Data Protection Act, will require detailed knowledge of the new technological between associated companies. « possibilities in their implications for data protection. personal data is limited to a specific, predetermined purpose, and must ---» Employee data protection must Bavarian Industry Association (VBW) be both appropriate and necessary for this purpose. Assessing appro- be rigorously reviewed and enhanced. priateness includes a check on whether a certain approach is also pro- Access rights, the right for data collection portionate, and both the principles of data reduction and data minimi- to be voluntary, the right to anonymi- Pressure for regulations on employee data protection stems from three sation must be taken into account. sation and all protective mechanisms main trends: firstly, the move away from clear geographical locations under data protection legislation must for data storage and processing and the shift from static to dynamic Court decisions have specified how these standards are to be inter- be clearly regulated and guaranteed so software development, which makes it more difficult to identify respon- preted in some circumstances, but not others. Certain principles, on as to leave no scope for monitoring of sible parties;169 secondly, applications capable of fully documenting, which there is a broad consensus, also emerge in the relevant literature. workers’ behaviour and performance. « evaluating, analysing and monitoring workers’ performance and work The guiding idea is that, in all cases involving checks and monitoring, a Rail and Transport Union (EVG) careful distinction must be made between permissible purposes on the one hand, such as workflow improvement and performance evaluation by ---» The increasing digitalisation of means of occasional data collection, and unlawful, permanent monitor- the world of work requires clear regula- ing on the other.172 For example, location tracking can be justified if it tions on employee data protection, as is intended to ensure workers’ personal safety, assist aid efforts in the digitalisation also opens up far-reaching event of an accident, or provide protection from crimes committed by monitoring possibilities for employers third parties, i.e. to ensure employees can carry out their work safely. (e.g. social media monitoring, real-time Another lawful purpose could be the desire to organise operational monitoring, linking data with staff processes more effectively, for example in the case of shipping or taxi profiles, communication analysis, etc.). « companies. The same applies to the optimisation of work carried out Federal Employment Agency off-site, for example on construction sites. However, it is not permitted to use legitimately collected data to subject staff to comprehensive monitoring of their performance and behaviour.

169 See the expert workshop organised by the Federal Ministry of Labour and Social Affairs on “Labour Law and Co-determination”, 170 Däubler 2015; Kopp/Sokoll 2015. https://www.arbeitenviernull.de/fileadmin/Downloads/Dokumentation_WS_5.pdf. 171 Däubler 2013. 144 172 Krause (2017). 145 Policy Options Policy Options

In principle, it could be argued that every form of permanent elec- ISSUES RAISED IN THE CONSULTATION PROCESS ---» By 2025, Europe could achieve tronic monitoring serves a contractual purpose and, as it enables the Growing awareness of the theoretical, abstract possibilities of Big an increase of 1.25 trillion euros in employer to ensure workers are actually performing in accordance with Data and data mining, as well as serious breaches of data protection industrial gross value added as a result their work contracts, should therefore be permitted. Given the particular in isolated cases175, have reinforced an existing sense of unease felt by of the digital transformation. (...) We nature of digitalised monitoring, however, the principle of proportion- much of the population when it comes to the issue of data protection must now set the right political and ality applies. This form of monitoring registers even the smallest behav- (… Chapter 2.3). Almost two-thirds see this as the area with the greatest economic course if we do not want to ioural anomalies, even those unnoticeable to a human observer, records need for statutory regulation in the process of shaping the digitalisation lose this potential value added to other them and makes them permanently analysable. This runs counter to the of the world of work.176 regions of the world. This includes principle of proportionality in most cases.173 expanding the digital infrastructure, Trust in data protection is an important prerequisite for the accept- creating a European Digital Single Similar arguments must be weighed up when it comes to analysing ance of digitalisation in both the economic sphere and the labour market, Market, and taking a responsible workers’ personalities. Regarding the analysis of corporate social net- and this has been grasped not only by EU institutions, but also by many approach to data in the digital world. « works, one example of an acceptable purpose might be to improve intra- companies, which welcome plans for the European Digital Single Market Federation of German Industries (BDI) corporate communication – for example between different sites. How- to be designed in such a way that it ensures a “responsible approach to data ever, it is generally held that it would not be permissible to engage in in the digital world”. » data retention and analyse the available data for different purposes. The relevant literature has found that all-encompassing objectives under In the Work 4.0 dialogue, too, most opinions on the Green Paper which the analysis of employees’ personal data essentially constitutes an e mphasised the importance of data protection. Trade unions and social end in itself to be impermissible. associations, in particular, advocate a specific Employee Data Protec- ---» ver.di is pressing for a strong, tion Act. » modern Employee Data Protection Act The collection and processing of fitness and health data, which con- which reflects the risks resulting from stitutes a special category of personal data (Section 3 (9) of the Federal No side is calling for a reduction in the existing level of data protec- new analysis techniques, external data Data Protection Act (Bundesdatenschutzgesetz)), require the employees’ tion. However, employers’ and business organisations emphasise that processing, and growing quantities consent, and stricter requirements apply for this consent (Section 4a (3) “striving for greater legal certainty must not lead to over-regulation of data. « of the Act).174 with unnecessary bureaucracy and few practical benefits.” » United Services Trade Union (ver.di)

As these examples show, the general provisions on data protection in The fault lines are particularly clear when it comes to works councils’ ---» Employee data protection has the law as it stands place limits on the new possibilities emerging as a participatory rights in relation to the introduction of technical devices a particularly important role to play result of digitalisation and Big Data without shutting them down (Section 87 (1) no. 6 of the Works Constitution Act). On this point, com- today. However, this does not mean entirely. However, fundamental considerations must be weighed up panies and employers’ associations would like to see “modernisation”, that further legislation is needed. After anew in each individual situation. For some issues, the law has been in the sense of “limiting” the right of co-determination “to those cases all, the level of data protection in developed further by court decisions, while for others this has not hap- in which monitoring is actually intended”. In all other cases – i.e. even Germany is already very high by inter- pened due to the absence of litigation before the courts. A wealth of if technical devices generate data which could potentially be used for national standards. The Federal specialist literature indicates, however, that there is a significant need monitoring, but the employer does not intend to make use of this pos- Data Protection Act already provides for discussion and that the legal situation is not always entirely clear sibility – the works council’s right of co-determination could be employees with very comprehensive for companies, in particular; nor for their employees. replaced, it is suggested, by a right for the works council to be informed protection from data misuse. « of significant changes to technical devices. It is also proposed that the German Retail Federation (HDE)

173 Krause (2017). 175 Selig 2011. 146 174 Kopp/Sokoll 2015. 176 Press and Information Office of the Federal Government (BPA) (2016). 147 Policy Options Policy Options

---» Co-determination in relation right of co-determination could be restricted to the initial introduction Further research and assessment is needed with regard to whether ---» The IG BCE rejects, as a matter to the introduction or application of of a system or significant changes to it. « technical solutions such as encryption and anonymisation could also of principle, the consideration of any technical devices has been overtaken by help to resolve data protection problems, and whether these could be kind of opt-out from a high level of reality. The large number of programs, The other side is calling for co-determination to be strengthened: made mandatory. data protection. On the contrary, we updates and software adjustments any kind of opt-out from a high level of data protection is opposed by need more co-determination rights make it all but impossible for both the trade unions. It is also proposed that co-determination rights should At present, no explicit “right of co-determination in relation to data which enable workers and their works works council and for the company to be flanked by additional provisions in collective agreements.177 « protection” exists. In practice, however, Section 87 (1) no. 6 of the councils to enforce a high level of find a sensible approach to co-deter- Works Constitution Act gives the works council a right of co-deter- data protection and minimise the mination in this context. It should be SHAPING THE WAY AHEAD mination in relation to many processes in the digital working world. amount of systematically collected carefully limited to the initial intro- The central challenge lies in maintaining Germany’s high level of Originall y, this provision had a relatively narrow scope of application, personal data. Digitally generated duction of a system or significant emplo yee data protection amidst the digital transformation and at the but due to the wider use of IT in the digital working world, in practice health data, for example, has no place changes to it, although it must be same time making use of the opportunities offered by technological it now covers a large proportion of hardware and software use. This not in human r esources data records. « ensured that the provision’s protective progress to shape the world of work. only includes the use of cameras, biometric access controls, smart Industrial Mining, Chemical and Energy Union (IG BCE) purpose remains in place. « glasses and mobile phones, for example, but also software which pro- Gesamtmetall – Federation of German In light of the challenges set out above, especially the need for legal cesses user data (including data collected by non-technical means). The Employers’ Associations in the Metal and clarity on digital applications, as well as the necessary implementation of introduction and use of such devices, or even a mere software update, Electrical Engineering Industries the European General Data Protection Regulation in Germany, there is a cannot go ahead without the works council’s consent. ---» Theoretically, all software and clear and present need for action. The General Data Protection Regulation every update today can potentially be offers national legislators the option to introduce more specific provi- As this provision was widely discussed in the consultation process, the used to monitor workers (even just as a sions on employee data protection, and this option should be used. The Federal Ministry of Labour and Social Affairs will examine whether and to result of logging in and out), which main aim should be to avoid a reduction in the existing level of protection, what extent there is a need for legislative action in this area. In view of the triggers the statutory requirement for and to provide greater legal certainty and clarity for employers and need for rapid decisions on the use of devices in cases where co-determi- co-determination. Even works councils workers. This would also help to increase trust. How this is to be imple- nation is mandatory, it must also be ensured that works councils have the are calling for a simplification once an mented from a legislative perspective must be examined closely. resources to be able to act as competent discussion partners for em- IT framework is in place: how can a ployers in corporate change processes (… Chapter 4.6). more pragmatic approach be taken In substantive terms, a reliable basis is needed for the legal assess- here in practice? « ment of technological developments, now and in the future; at the Federal Association of Labour same time, there must not be an obstacle to technical innovation. This Law Experts in Businesses (BVAU) means that principles must be formulated which, on the one hand, allo w data to be used selectively, for example to optimise business p rocesses, boost efficiency, measure performance generally in the organisation, ensure health and safety at work, or identify where training is needed.178 On the other hand, however, secret checks, permanent monitoring of work behaviour, and the creation of comprehensive movement and behavioural profiles must remain generally prohibited, and this may have to be made more explicit in the law. The use of biometric systems and socio-psychological analysis as well as the c ollection of employees’ health-related data should – again, explicitly – be restricted to specifically regulated and limited purposes.

177 Marburg Federation of Doctors (MB) 2015. 148 178 Hornung/Hofmann 2015; Krause (2017). 149 Policy Options Policy Options

The pace at which the technical possibilities are evolving and the SUMMARY complexity of applications are generating uncertainty amongst both • Action is needed on employee data protection as a result, firstly, of employers and works councils, and particularly in SMEs, around to continuing technological developments and the growing importance of whether and how statutory provisions on data protection can be imple- digital applications in the world of work, and, secondly, of the new Euro- mented in practice. Against this background, the Federal Ministry of pean legal framework, the European General Data Protection Regula- Labour and Social Affairs is planning to develop an “Employee Data tion, which is due to enter into force in 2018. The Regulation contains Protection Index”. The aim is to develop well-researched, application- “opening clauses” which allow specific provisions at national level in focused quality standards for employee data protection , which – by certain areas. providing a tool for self-assessment or for certification – make employee data protection in organisations easier to compare and more manageable. • The Federal Ministry of Labour and Social Affairs will safeguard statutory employee data protection in two steps. In the framework of In view of the decades-long debate, the changed legal framework the planned “Data Protection Adaptation and Implementation Act EU” and the fact that technical possibilities and applications are not yet fully (Datenschutz-Anpassungs- und Umsetzungsgesetz EU) implementing understood, the Federal Ministry of Labour and Social Affairs will set up the European General Data Protection Regulation, which will replace the an interdisciplinary advisory council in the near future, involving experts Federal Data Protection Act (Bundesdatenschutzgesetz) in its present with a background in labour law, occupational health and technology; form, it will ensure that the crucial section for employee data protection experts and practitioners in the field of data protection; and the social (Section 32 of the Federal Data Protection Act), which regulates “Data partners. The advisory council will be tasked with taking stock and pre- collection, processing and use for employment-related purposes”, is retained. paring sector-specific legal provisions for employee data protection, The tried-and-tested approach of regulating data protection at the firm- with a binding timetable. The Federal Ministry of Labour and Social level in works agreements will also remain possible. Affairs will also ensure that the provisions on employee data protection are reviewed at suitable intervals to determine whether they are still • As a second step, the Federal Ministry of Labour and Social Affairs sufficient in light of technological developments. plans to make full use of the leeway the European General Data Pro- tection Regulation offers national legislators for more specific provisions. To this end, it will set up an interdisciplinary advisory council which will support the Ministry in preparing these separate legal provisions on employee data protection on the basis of a stock-taking exercise and with a binding timetable.

• In addition, the Ministry will examine whether there is a need for legislative action in relation to the Works Constitution Act (Betriebs- verfassungsgesetz).

• The Federal Ministry of Labour and Social Affairs will support the development of an “Employee Data Protection Index”, on the basis of which well-researched quality standards can be developed to assist companies and works councils, especially in SMEs, in the practical implementation of statutory data protection.

150 151 Policy Options Policy Options

4.6 CO-DETERMINATION recent developments in the world of work make it necessary to expand ---» Cooperation, in a spirit of trust, existing co-determination regulations. » between the employer, the works AND PARTICIPATION: council and the workforce will not be Notwithstanding this, it makes sense to primarily use the existing instru- abandoned because of the develop- TRANSFORMATION BASED ments of institutional co-determination , not least because, as was ments in the framework of “Work 4.0”. also made clear in the consultation process, co-determination contin- Existing staff representation structures ---» Co-determination is the ON SOCIAL PARTNERSHIP ues to command broad and undiminished support in society, among will, however, be changed by digitali- democratic principle for shaping the workers – including senior managers – and also many employers.179 sation. In this context, the current social market economy. It must be That said, the conclusions and reflections set out below should not be balance between entrepreneurial free- developed further to cope with the In the German model of the social market economy , institutional seen as a general co-determination strategy. Instead, they relate to dom in decision-making and rights challenges of the work of the future. « co-determination of workers at the workplace level (under the Works specific questions regarding workers’ participation in changed corporate of participation and involvement Hans Böckler Foundation Constitution Act (Betriebsverfassungsgesetz)) and at the company level and organisational structures of Work 4.0. » must be respected, as must the limits (under the statutory provisions on co-determination in supervisory of co-determination stipulated by boards) has always played a vital role. Its benefits in weathering crises What is vital in this context is, primarily, a willingness and ability to constitutional law. « ---» Germany can take pride and structural upheavals have repeatedly been demonstrated. « reach a consensus through negotiation. This requires structural conditions Confederation of German in the achievements of the social and forums for such negotiations, as well as an ability to compromise and Employers’ Associations (BDA) market economy, including the The changes in markets and companies in recent years, which have a willingness to learn from past developments. Looking at individual social partnership. « been accelerated in particular by digitalisation and the increasing forms of democratic participation and institutional co-determination Gesamtmetall – Federation of German transnationalisation of value chains and work contexts, are also having a together can benefit both, and can increase workers’ opportunities for Employers’ Associations in the Metal and direct impact on industrial relations (… Chapter 2.6). The best chance of participation as a whole. Particularly in sectors such as the ICT industry, Electrical Engineering Industries successfully coping with current and future transformations in the which has no tradition of social partnership, experiments with new partici- ---» Digital work, especially in world of work exists if companies and workers shape them in partnership pation strategies and agile forms of work have been taking place, self- ---» Work 4.0 will be different from international production networks, is and fairly consider and balance the needs of both sides. « organisation is expected, and innovation processes are changing.180 today’s work. It must be possible for the affecting the traditional concept of a Many workers also want to be directly involved.181 social partners at the workplace level company and posing new challenges ISSUES RAISED IN THE CONSULTATION PROCESS to shape this transformation on an equal for the culture of co-determination. This fundamental idea runs through many responses to the Green Given that new ways of organising work are placing growing emphasis footing. This requires a significant The German Works Constitution Paper on Work 4.0 published by the Federal Ministry of Labour and on horizontal concentration of knowledge, possibilities for participation expansion in co-determination rights. « Act must be adapted and further Social Affairs, and the vast majority of participants in the consultation by individual workers and self-organisation in teams, it is also in the orga- German Trade Union Confederation (DGB) developed in light of these trends. « process regard the involvement and participation of workers as a key nisation’s best interest to strengthen participatory elements at work- Daimler AG factor for successfully shaping tomorrow’s working world. That said, the place level. Agile markets need agile corporate decision-making pro- responses submitted by workers’ representatives and business associa- cesses to allow rapid responses to changes in customer preferences or ---» From a managerial perspective, ---» Co-determination is the foundations also reveal very different views on the question of whether or not other market requirements. In the long term, this is only possible with the co-determination in Germany has tion for shaping good digital work and proven its worth, especially due to its offers instruments for ÿnding compro- effectiveness in promoting cooperation mises in “new” problem areas, such as and social peace. « work intensiÿcation, data protection, German Confederation of Managers (DFK) restructuring processes, etc. To this end, co-determination must be politically strengthened and internationalised. « Rail and Transport Union (EVG) 179 Nienhüser et al. 2016. 180 See the expert workshop organised by the Federal Ministry of Labour and Social Affairs on “Socially Compatible Change Management and Good Corporate Management”, http://www.arbeitenviernull.de/dialogprozess/workshops.html. 152 181 Sattelberger u. a. 2015. 153 Policy Options Policy Options

---» Companies use various optimal involvement of all talents, perspectives and skills in the com- EXPERIMENTAL SPACES AT ROBERT BOSCH GMBH AND instruments to secure workers’ par- pany. The transformation of work should therefore be shaped in part- FIDUCIA & GAD IT AG ticipation and involvement. On the nership, taking into account both the company’s requirements and Companies are currently seeking a blueprint for the future world of work. one hand, they do so to fully leverage workers’ needs and preferences in order to make the most of the orga- Companies as varied as the industrial group Robert Bosch GmbH and the IT their workforce’s expertise for the sake nisation’s potential. Experimental spaces (… Chapter 5) developed on service provider Fiducia & GAD IT AG have begun to set up labs to experiment with of competitiveness, but on the other the basis of social partnership can take the form of labs for trying new new approaches in practice. In future, these companies want to drive forward hand they also do so to identify models in practice (… box). « disruptive innovations and new business models in their organisations without jeopardising their stability, and they want to include and involve their staff in workers’ needs and boost their attrac- this process. At Robert Bosch GmbH, staff and managers are looking at the tiveness as an employer. Consequently, question of how it is possible to successfully move towards becoming an “agile strategic decisions in companies are company”, in view of the rapid changes in the automotive industry. Agile forms more and more often being taken with of work, new requirements for managers and even changes in the corporate culture are being developed in pilot units. Meanwhile, Fiducia & GAD IT AG, as the aid of working groups, large-scale the IT service provider to the cooperative banks, is actively grappling with the employee surveys or workshops. « disruptive transformation of the financial industry. The focus here is primarily Employers’ Association of Insurance on new ways of generating innovations and their implications for staff – from Companies in Germany (AGV) working time to new demands.

“We’ve learned that we’re not dealing with a normal change process; we’re facing a genuine revolution,” explains Jörg Staff, member of the executive board and labour director of Fiducia & GAD IT AG. As open-minded experimental spaces , both companies’ labs take an agile approach in their work. Instead of the focus being on executing a predefined project plan, tasks and objectives are set in short cycles. Workers and managers from the departments concerned produce concrete outcomes in sprints lasting a few weeks. “It’s very important to us that solutions aren’t developed in a vacuum; instead, employees must be at the heart of the process and involved from the outset,” stresses Alfred Löckle, the chairman of the central works council at Robert Bosch GmbH.

The basis for the labs’ success is a steering committee with high-profile members, structured on the basis of social partnership. The committee ensures that the outcomes are anchored in the wider company and uses these outcomes to define the way ahead in the transformation process. The fact that it is structured on the basis of social partnership ensures that the steering committee promotes a long-term perspective for the labs, and gives the workforce the trust they require to accept change processes. As these labs represent uncharted terri- tory for the companies concerned, they are drawing upon independent academic support from the Institute of Social Science Research Munich (ISF München).

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---» The fundamentally positive, The Works Constitution Act offers many possibilities for broad involve- to friction, and at the latest when rights also have to be secured in ---» In an era of skilled labour SME-driven culture of internal comment of the workforce and is compatible with Scrum or other forms of court, only institutional co-determination offers reliability for workers. short ages, we can say that today it is promise in e-commerce and distance agile resource planning. Many works councils have therefore long since This makes the legal framework for the establishment and functioning of an “employee’s market”. The bargain- selling has always resulted in much less started using innovative forms of targeted grassroots democratic involve- works councils all the more important. » ing position of workers has improved friction in organisations. Both emp- ment of the workers they represent. enormously compared to that of employ- loyers and employees value direct SHAPING THE WAY AHEAD ers. The playing field is a level one, at dialogue, which allows key issues to be Conversely, those workforces where great emphasis is placed on indi- As an outcome of the Work 4.0 dialogue, the Federal Ministry of the very least. And so tailored solutions, regulated without recourse to vidual participation can benefit from the advantages of institutional Labour and Social Affairs has identified a total of four key elements in negotiated between employees and associations or trade unions. « co-determination . Flatter hierarchies do not necessarily mean more consolidating and strengthening the negotiation of flexibility compro- employers, are preferable to rigid German E-Commerce and Distance Selling Trade and better opportunities for participation, and greater individualisation mises by the social partners in the coming years. These are: stabilising statutory requirements which seek Association (bevh) of the workforce can also lead to con®icts if some workers who are strong and strengthening collective bargaining structures in Germany, to cover every possible case. « negotiators can win more ®exibility for themselves at the expense of oth- widening the basis for participation by workers, safeguarding ad- The Young Entrepreneurs (BJU) er, less assertive workers. Institutional co-determination at the level of equate rights and resources for co-determination in the digital world the workplace can reconcile divergent wishes and play a part in enabling of work, and safeguarding standards for corporate co-determination – ---» In the – still growing – zones all workers to benefit equally from more negotiated flexibility. including in Europe. without works councils or collective ---» The economic environment in agreements, a minimum level of accept- Germany has, for years, been charac- Likewise, when dismissals for operational reasons have to be negoti- To create solid foundations for shaping the world of work on the basis of able working conditions can exist if terised by sweeping corporate and ated with management, guaranteed rights for employee representatives social partnership, the Federal Ministry of Labour and Social Affairs is works councils are set up and collective group restructurings, both organisa- are an important safeguard for negotiations on an equal footing.182 Yet vigorously pursuing the Federal Government’s shared goal of boosting agreements are brought into force. « tional and legal in nature, takeovers, only a minority of employees in Germany – just four in ten – are currently collective bargaining coverage in Germany. One particular challenge Hans Böckler Foundation spin-offs and mergers. By international represented by a works council. They exist in fewer than one in ten organ- in this context is the fact that the lines between different sectors will standards, it is remarkable how isations with ÿv e or more workers, and it is only from about the level of 100 continue to blur as a result of digital structural change. Widely binding smoothly these processes have taken workers that organisations with a works council are in the majority.183 « collective agreements can be extremely helpful in managing change place, which is thanks in no small part processes, especially in the era of digitalisation. For collective bargaining to co-determination. « It is far from the case that workers in organisations without a works coverage allows working conditions to be regulated even in areas German Confederation of Managers (DFK) council inevitably have inadequate opportunities for participation, as where the state would find it difficult or impossible to achieve a compa- such opportunities can also be realised outside the statutory frame- rable level of clarity, customisation and detail via general legislation. The work. Yet if there is no works council, it is at least questionable how financial and economic crisis is just one of the situations which have consistently available the conditions are for the two sides to negotiate highlighted how tailored and flexible collective agreements are today, compromises on an equal footing in difficult times. Ultimately, co-deter- and how fully they take into account the differing concerns of organi- mination must be based on rights, not promises. Where negotiating sations even within the same sector. compromises and developing a framework for change processes leads

182 See the expert workshop organised by the Federal Ministry of Labour and Social Affairs on “Labour Law and Co-determination”, https://www.arbeitenviernull.de/fileadmin/Downloads/ Dokumentation_WS_5.pdf. 156 183 Ellguth/Kohaut 2016. 157 Policy Options Policy Options

One way to boost collective bargaining coverage could be to create is not a trivial offence. One important element in fostering the establish- incentives for membership in employers’ associations and trade unions, ment of works councils is to improve the protection against the dismissal in order to create a broader legitimising basis for regulations in collec- of employees who press for a works council to be set up. The Federal tive agreements. The Federal Ministry of Labour and Social Affairs is Ministry of Labour and Social Affairs is observing developments in examining whether such incentives, particularly in relation to employers’ these areas very closely, and will examine whether the Works Constitu- associations, can be implemented in legislative initiatives, for example tion Act’s sanctions for obstructing works council elections need to be on the regulation of temporary agency work or occupational pension increased, and whether and what adjustments are necessary to better schemes, by making collective bargaining coverage a prerequisite for protect those who press for co-determination . the options enshrined in the legislation – in other words, allowing greater flexibility, but only via a collective agreement. The extension of There is a general consensus that the digital world of work is placing collective agreements can also play a part in this. In some sectors, greater demands on staff representatives as a result of rapid changes and however, the barriers to extending collective agreements are too high. greater complexity. They have to be able to correctly assess technical They must be lowered, with the aim of boosting collective bargaining and organisational developments, find approaches which reflect work- coverage in this respect as well. ers’ interests, and reach solutions in dialogue with management. A well- ---» The co-determination process qualified and well-advised works council reflects companies’ legitimate needs to become more rapid and effi- Active staff representation bodies are vital to the successful organi- interest in rapid decisions and procedures tailored to the organisation cient, to reflect the ever faster decision- sation of working conditions, and they are irreplaceable counterparts in question. A works council of this kind can assess complex IT issues making in the digitalised environment for management, especially in coping with disruption in the digital and updates which are to be applied at short notice much more rapidly and changes in functional units. Great- world of work. The Works Constitution Act’s provisions offer a tried- and thus react much more quickly, which in turn would help to signifi- er use must be made of digital means and-tested, stable and recognised basis for worker co-determination . cantly speed up co-determination processes in the digital working of communication in the involvement In light of this, the Federal Ministry of Labour and Social Affairs is aiming world, as called for by employers. In other words, there is a need for regu- of the works council and in the dialogue to foster the establishment of works councils. lar skills development, on the one hand, and access to expert support, between works council members. « on the other. » Bavarian Industry Association (VBW) In addition, it is seeking to expand the scope of the simplified electoral procedure introduced by the 2001 reform of the Works Constitu- As the law stands, the employer must enable the works council to tion Act so that it applies to a wider group.184 To date, it has applied only fulfil its function by making knowledgeable personnel available to to organisations which have five to 50 workers with voting rights and, if provide information; external experts can also be consulted if this is agreed with the employer, organisations with 51 to 100 eligible voters. agreed. Going beyond this, a discussion took place in the consultation The simplified electoral procedure should be binding in organisations process on whether works councils should be given the right to consult with up to 100 eligible voters. The provision for small organisations is an expert before the introduction of new work processes and equipment, specifically intended to encourage the creation of works councils in new hardware or new software. this category, where they are still significantly underrepresented.185 The Federal Ministry of Labour and Social Affairs is seeking to intro- Changing the thresholds for the simplified electoral procedure can duce this right, which should be based on the following principle: the also help to reduce the prevention and obstruction of works council consultation of an expert should be limited to the right of co-determina- elections. According to surveys of trade union officials, this occurs dis- tion in relation to the introduction and use of technical devices designed proportionately often in small organisations with 51 or more employees.186 Obstructing works council elections and the activities of these councils

184 In addition to formal simplifications for small organisations, the simplified electoral procedure also involves shorter time limits for the election of the works council. 185 See Greifenstein et al. 2014. 158 186 Behrens/Dribbusch 2014. 159 Policy Options Policy Options

to monitor the behaviour or performance of the employees (Section 87 (1) However, the suggestion that the way in which works councils oper- ---» The issue of online or video no. 6 of the Works Constitution Act), as this provision covers the main ate needs to change in the digital era is generally valid. For example, it conferences is relevant in practice for aspects of the digital working world. The right should not be subject to has long been a simple matter, in technical terms, to hold video confer- all supra-regional staff representation a requirement that a knowledgeable employee within the organisation ences between various sites. Nor does the law as it stands prevent video bodies. Central and group-level works must first be made available. Processes and applications are changing conferences between works council members. However, they are not councils often have members from across at high speed in the digital working world, and this ought to be reflected permitted at present for works council meetings, due to the important Germany and cannot schedule many by a legal provision enabling the works council to directly access external principle that these meetings are private. Unlike in the case of face-to- regular meetings at which decisions can expertise. While this would initially result in higher costs, the works face meetings, it is impossible to ensure that no third party is listening in be taken. This can considerably slow council would be able to react more quickly, offering the prospect of on a video conference out of view of the camera or outside the meeting down co-determination processes and solutions being implemented more rapidly, which could reduce costs rooms, or secretly recording the meeting. Video conferences also lack the thus the implementation of business and work. Nonetheless, given the cost companies would incur as a result element of direct face-to-face interaction, which is growing more impor- projects, which can also count against of the new provision, it would be appropriate for this right to only apply tant as work contexts become more virtual. Nonetheless, the possibility Germany in decisions on business loca- in the case of companies with 300 or more employees (similarly to the right of allowing works council meetings to take place via video conference in tions within international groups. « ---» Today, whether the right of to retain a consultant under Section 111 of the Works Constitution Act). exceptional cases could be considered. This should, however, have to be Federal Association of Labour co-determination applies in relation to at the works council’s initiative, based on a unanimous decision, and lim- Law Experts in Businesses (BVAU) the introduction and use of technical Although the term “data protection” is not explicitly mentioned in ited to narrowly deÿned exceptional cases where particular urgency makes devices depends solely on the possi- the Works Constitution Act, in practice many works councils use their it extremely difficult to organise a face-to-face meeting. In addition, the bility for these devices to be used to right of co-determination under Section 87 (1) no. 6 of the Works employer would have to take technical measures to ensure that third monitor performance and behaviour. Constitution Act to conclude works agreements on data protection parties would not be able to listen in on the meeting. » This is an overly narrow approach (… Chapter 4.5).187 The Federal Ministry of Labour and Social Affairs which prevents processes being imple- will examine – particularly in view of the EU General Data Protection Staff representation on companies’ supervisory and administrative mented that reflect the reality of day- Regulation – whether and to what extent there is a need for legislative boards is also particularly important in turbulent times. In Germany, to-day business. It is no longer suited action in this area. corporate co-determination can look back on decades of visible successes to a digitalised working world. « and a proven track record, particularly in times of crisis. The Federal Federation of Chemical Employers’ During the consultation process, many business associations and Government has embedded corporate co-determination in the negotia- Associations (BAVC) companies called for the works council’s right of co-determination to be tions on European company law directives – especially on the European limited to cases in which a technological innovation is intended to result Company (SE) – and thus protected workers’ existing rights. in the monitoring of employees’ performance or behaviour. In cases where monitoring merely becomes possible as a result of the innovation, Digitalisation makes it easier for companies to be organised transna- ---» Work 4.0 will often consist of but is not intended, it was argued that the works council should only tionally, particularly within the integrated European single market. work within a global group. In this have a right to be informed. However, this would signiÿc antly water down However, to ensure that corporate co-determination cannot be circum- context, strong corporate co-deter- ---» Co-determination rights in a co-determination right in an area which is becoming ever more impor- vented by the use of European legal forms or the use of foreign legal mination, in particular, plays a key relation to the introduction of new tant in practice and which is a source of great concern for workers – even forms in Germany on the basis of freedom of establishment, further and constructive role. It enables direct technologies and work processes, if they are not facing a specific case where an intention to introduce regulatory steps are needed, especially at European level, so that the discussion with shareholder represen- including technological impact monitoring has been expressly stated, or the possibility of monitoring proven benefits of solutions negotiated on the basis of social partner- tatives in the supervisory board and assessments, must be is to be introduced. This, in particular, is an area where it should be in the ship can be reaped even if companies become more international. » allo ws joint supervision of and provi- significantly expanded. « interest of both sides for solutions to be reached in agreement between sion of advice to the executive board. « German Trade Union Confederation (DGB) management and qualified staff representatives. « To safeguard existing standards, a 14th Company Law Directive on German Trade Union Confederation (DGB) the cross-border relocation of companies’ registered offices needs to be adopted. This is a key priority for the Federal Ministry of Labour and Social

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Affairs. The aim is to ensure that this directive is placed (back) on the A BRIEF ASIDE: THE “COMPANY” CONCEPT, CORE AND political agenda in Brussels. In order to ÿrml y embed corporate co-deter- PERIPHERAL WORKFORCES, AND CO-DETERMINATION mination in Europe in the long term, the Federal Ministry of Labour and The question of whether the digital transformation of the economy requires Social Affairs is also supporting the European Trade Union Confedera- The concept of the company some kind of revision of the concept of a “company” to reflect the potential ---» tion’s call for minimum standards of employee participation to be firmly further virtualisation of work contexts, especially in the Works Constitution Act must also be rethought as a result of anchored in Europe. To this end, negotiations should be launched on a (Betriebsverfassungsgesetz), has been the subject of intensive discussion in the digitalisation – as digital technologies 188 directive on minimum standards. A directive of this kind could also respond Work 4.0 dialogue. There is no legal definition of what constitutes a “com- mean work is increasingly no longer pany”; rather, the term was coined and has been developed further by court to the issues raised in relation to the SE – the “freezing of co-determi- tied to a specific location, but defined decisions. The Federal Labour Court and the legal literature understand a company nation ” and the call for adjustments in the event that national thresholds as “the organisational unit within which the entrepreneur, alone or together more and more by virtual access, or- are crossed – without, however, calling into question the consensus with staff, continuously pursues certain work-related purposes using tangible ganisation and monitoring of digital achieved on the SE itself. and intangible assets”. This definition of a company contains no geographical processes. A review is therefore needed limitations – it also covers teleworkers and off-site workers. In other words, a of whether the term “company” must be company does not end at the factory gates. The crucial issue is whether the At national level, the possibilities offered by company law for compa- employer is pursuing a work-related purpose with the employees’ assistance. adapted. « nies to establish subsidiaries must not continue to lead to a loss of co- Even a purely “virtual permanent establishment” and other modern organisa- German Trade Union Confederation (DGB) determination . This could be countered by ensuring that employees tional structures can, in principle, be covered by the definition of company as it has been developed by court decisions. in subsidiaries and second-tier subsidiaries count directly towards the » ---» The existing co-determination threshold in the Act on One-Third Employee Representation in the Super- As well as the possibility of the company being the sole organisational unit, the system focuses on the concept of the visory Board (Drittelbeteiligungsgesetz) – as is already the case for the law already offers various flexible options for creating works council structures company, which is rooted in the era of Co-determination Act (Mitbestimmungsgesetz). which reflect the specific organisational and decision-making structures of the traditional, industrial organisation of company or group, and which ensure that the works council can always function work, tied to a specific location. This at the level where the key decisions are taken. The main instrument for such arrangements is the collective agreement. Works agreements are permitted if there concept is losing its significance due to is no relevant provision in a collective agreement and no other collective agree- growing flexibility and digitalisation. « ment applies. This is a suitable approach, as further scope for agreements which Federation of Chemical create staff representation structures across company boundaries would lead to Employers’ Associations (BAVC) a disconnect between co-determination and the actual company in question. » The Federal Ministry of Labour and Social Affairs believes that, in practice, ---» With work taking place in virtu- the shaping of the term “company” by court decisions and the broad scope in al space, greater flexibility should be in- the Works Constitution Act for agreement-based solutions are more helpful troduced regarding the possibilities for than a formal definition of the term “company”, which would be at risk of being rendered outdated by new developments a day later. These measures mean it will reorganising company structures via remain possible in future to react quickly and effectively to developments which works agreements, and employers and cannot be foreseen by legislators. The Federal Ministry of Labour and Social works councils should be given greater Affairs therefore sees no need for regulatory action regarding the concept of the leeway in the delineation of their com- “company” at present, but will nonetheless keep a very close eye on future developments and their implications for co-determination. pany. « Confederation of German Employers’ Associations Another issue discussed in close connection with the concept of the “company” (BDA) is eliminating qualitative disparities in co-determination in relation to core and peripheral workforces. This discussion is taking place against the background of scenarios in which, due to new possibilities of digitalisation and the subsequent outsourcing of work processes from what was previously the

188 See the expert workshop organised by the Federal Ministry of Labour and Social Affairs on “Labour Law and Co-determination”, https://www.arbeitenviernull.de/ 162 fileadmin/Downloads/Dokumentation_WS_5.pdf; Uffmann 2016. 163 Policy Options Policy Options

---» Co-determination is at risk of company’s core, greater use is made of flexible ways of purchasing labour, SUMMARY losing all meaning in the case of cloud- with the risk of an erosion of the foundation for institutional co-determination Social partnership, co-determination and democratic participation (… Chapter 2.6). • based IT systems, if applications are no « in the design of working conditions are a core element of the German

longer managed by the company itself It must be borne in mind that the “company” concept determines the organ- social market economy, a force for stability in times of crisis, and factors but by third parties, in international isational unit in which works councils are set up and exercise their participa- for success even in the face of international competition. They are an corporate groups where there is no au- tory rights. In this framework, the works council is entitled, as the employer’s important element of a good corporate and management culture, not counterpart, to place limits on the employer’s right to issue instructions to thorised negotiating partner on the barriers to it. employees. “Peripheral workforces” are not a homogenous group, and so dis- employer’s side or the partner does not parities exist with regard to the employer’s right to issue instructions to them. possess sufficient powers at national For example, temporary agency workers are subject to the instructions of the • To successfully cope with digital change, the structural conditions level, if works councils are no longer re- employer in the organisation to which they are assigned, and so works councils for negotiation processes between the social partners and at the work- have corresponding participatory rights. Accordingly, the bill to combat misuse sponsible for the people working in the place level need to be strengthened. In particular, there is a need for a of temporary agency work and contracts for work and services also clarifies company because the basis for staff that, in principle, temporary agency workers count towards the thresholds for stabilisation of collective bargaining structures in Germany, a broader representation is fragmented by grow- staff representation. foundation for workers’ involvement in their organisations, adequate ing peripheral workforces, or if the rights and resources for works councils and staff councils, and the safe- The situation is different in the case of contract workers who are active on-site. company as the basis for works council guarding of national standards of corporate co-determination, including The employer of the organisation where they are working has no right to issue rights is at risk of eroding. « instructions to them, and so there is no basis for the works council to have co- at European level. Hans Böckler Foundation determination rights. For example, an employer cannot instruct the contract workers on-site at the organisation in question to comply with the working The Federal Ministry of Labour and Social Affairs will therefore con- times set out in a works agreement. • ---» The rights of precarious work- tinue to make greater regulatory options in future legislative initiatives ers must be brought into line with those However, beyond the question of the employer’s power to issue instructions, contingent on the existence of collective agreements. It will take steps of the core workforce. This applies to the digital transformation of the economy and the potential for a future to promote the establishment of works councils, and it will – including collective agreements and to co-deter- incr ease in the role of self-employed or employee-like workers in the production in the interests of companies, which have legitimate needs for greater of goods and services are also raising new questions about these workers’ need mination. flexibility in light of rapid market changes – present proposals as to « for protection and consideration in the staff representation system. In some DB Dienstleistungen GmbH – cases, this is leading to calls for the scope of application of the Works Consti- how works councils’ ability to engage in co-determination effectively Divisional Works Council tution Act to be widened to include all economically dependent persons or and efficiently in the digital world of work can be boosted. persons in need of social protection who are involved in the pursuit of the company’s work-related purpose (… Chapter 4.7).189 • The Federal Ministry of Labour and Social Affairs sees no need at present for regulatory action regarding the concept of the “company”, but will continue to monitor this issue.

189 See, for example, Conference of the Labour and Social Affairs Ministers of the Länder (ASMK), Conference of Deputy Ministers (2016).

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4.7 SELF-EMPLOYMENT: FOSTERING pulsory social security systems. This perspective instead assumes that ---» Self-employed people are self-employed individuals can earn a good living and make private pro- r esponsible for their own social FREEDOM AND SOCIAL PROTECTION visions to protect themselves from social risks. » pr otection. « Association of German Chambers of Commerce ISSUES RAISED IN THE CONSULTATION PROCESS and Industry (DIHK) ---» The German economy will Self-employed individuals, with their entrepreneurial spirit, are the Scrutinizing issues which are particularly important to self-employed benefit more and more from solo backbone of the economy and essential drivers of growth, innovation individuals was a priority in the Work 4.0 dialogue. It became clear ---» Self-employed individuals can self-employed individuals. Starting a and employment in Germany. Yet self-employment takes many forms: it that the question of self-employed individuals’ need for social protection decide for themselves when, where and business must therefore be an attractive ranges from established entrepreneurs in the high-tech sector and tradi- is arising anew today. That said, the concerns of self-employed individ- on what terms they want to work. « proposition. This is achieved by financ- tional craft businesses, to risk-taking business founders, freelancers and uals vary widely, depending on their economic and social situation. » Confederation of German Employers’ Associations (BDA) ing and capitalisation models which creatives, to casual self-employed workers. The digital transformation do not require an undertaking’s success is widely expected to result in a rise in new forms of self-employed work. In discussions with representatives of self-employed workers, small to be 100 per cent guaranteed before This is also likely to lead to further variety in self-employment, from app business owners and business founders, a wide range of positions were ---» This raises the question of it has even begun. An economy programmers in the “crowd” to “on-demand” cleaners (… Chapter 2.2). «« put forward on matters such as provision for old age – from the desire whether the living and income situations which thrives on the spirit of for complete freedom from state interference, to the inclusion of self- of solo self-employed persons, and invention and innovation must be By international standards, Germany has relatively low levels of business employed individuals with low incomes in the artists’ social insurance especially crowdworkers, allow any real able to allow failures. « start-ups. Nonetheless, self-employment rose significantly from the system, to the proposal of an unconditional basic income for all citi- level of voluntary social protection. « Alliance of German Designers (AGD) 1990s to 2012. In recent years it has declined again slightly. In order to zens. Self-employed individuals with low incomes often complain that German Association for Social Security Research unlock the potential of small and medium-sized businesses in particular, remuneration and fees are too low, making it impossible to finance an and Policy (GVG) ---» Digitalisation and inter- it remains important to support self-employed individuals and business appropriate level of social protection. Many self-employed persons also connectedness are fuelling the trend founders, to promote research and development, to facilitate coopera- drew attention to the rising overall burden of social insurance contribu- towards self-employment. These tion with the research community, and to support innovation consulting tions in the event that compulsory old-age provision is introduced. » ---» A pension insurance obligation self-employed workers often have in organisations. The federal support programmes which supplement the for self-employed persons amounts to several sources of income and are comprehensive services available from banks and private investors to the economic disempowerment of respon- active in several business fields, and finance start-ups and SMEs include low-interest loans, guarantees and sible individuals. Disempowerment by they must urgently be taken start-up grants. « the nanny state, you might say. « into consideration. « 22 Apr. 2015 via arbeitenviernull.de 22 Apr. 2015 via arbeitenviernull.de In principle, the challenges of the world of work 4.0 discussed in previous sections apply equally to the entire labour force, including self-em- ---» Anyone who focuses solely on ployed individuals and employees alike. However, the policy options start-ups is forgetting that 80 per which have been outlined, particularly those focusing on protection and ---» As a creative who tends to have cent of entrepreneurs are small social safeguards, primarily relate to the latter. This reflects the fact an irregular income, I naturally take a business owners. They are the econo- that self-employed individuals have traditionally been regarded as less very positive view of a basic income. « my’s backbone; start ups are in need of protection. They are therefore deliberately exempted from 22 Jan. 2016 via arbeitenviernull.de the drivers of innovation. « many labour and social laws and are generally not covered by the com- 22 Apr. 2015 via arbeitenviernull.de

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---» Discontinuous employment Changes in people’s employment histories are leading to these issues on basic income support in old age. They account for a significantly histories, with alternating periods of being seen in a new light. “Once self-employed, always self-employed” – higher proportion of people receiving basic income support in old age employment in jobs with compulsory although this will remain true for some self-employed persons, for others (17 per cent) than they do among senior citizens who do not receive social insurance coverage and solo the new diversity in employment histories will increasingly mean moving basic income support (10 per cent). While many have a high income, self-employment, require adjustments between dependent employment and self-employment or combining there are also many formerly self-employed senior citizens with low to the social insurance systems. « employment with self-employment on the side. « incomes. Almost half of formerly self-employed people have a net United Services Trade Union (ver.di) income of under 1000 euros, while this is true of just over a third of The dynamic development of self-employment (… Chapter 2.1) has former blue-collar or white-collar employees. On the other hand, nine drawn growing attention to self-employed persons’ provision for old age. per cent of self-employed people have an income of over 3000 euros in ---» With the advance of digitali- Only a small proportion of these individuals are subject to a statutory old age – the same can be said of just two per cent of former blue-collar sation and a changed working world obligation to make provision for old age.190 The vast majority, around three or white-collar employees.193 with new forms of work, the question of million people, are not subject to this requirement. « social protection for the rising number Some self-employed individuals also have problems paying the con- of solo self-employed individuals, or In this context, there are a range of uncertainties and difficulties to tributions for their health insurance. This has led to high contribution freelancers, is becoming more urgent. consider. Although some self-employed people own significant means arrears in the statutory health insurance system, which have to be paid Their earnings are often too low for of production, the potential proceeds which can be obtained by selling for by the pool of insured persons. Only a few groups of freelance pro- them to be able to afford personal the business upon retirement are difficult to calculate years or decades fessionals and business owners are subject to compulsory insurance in forms of provision for old age, and so in advance.191 Furthermore, in the event of insolvency, all assets can be the statutory health insurance system. All other self-employed people ---» As a freelancer, I would they are having to go without. « lost, including private investments made as provision for old age. In can voluntarily enrol in the statutory system or take out private health really like to live off my work and Social Organisation Germany (SoVD) discontinuous employment histories with alternating periods of self- insurance. Everyone is required to have health insurance, however. not constantly need to pay yet more employment and dependent employment, relatively short periods of Since 2006, a catch-all insurance obligation in the statutory health taxes or disproportionately high ---» As a consequence of digitali- self-employment will generally not be sufficient to build up adequate i nsurance system has applied. In this case, the minimum contribution social security contributions (e.g. sation, new self-employment relation- personal provision for old age, especially if earnings during these peri- to be paid by self-employed individuals is around 400 euros, depending to the health insurance fund). « ships are emerging around the indus- ods are low. At the same time, gaps emerge in people’s contributions on the choice of insurance fund. » 22 Apr. 2015 via arbeitenviernull.de trial cores. They take different forms. Not history in the statutory pension insurance system. Individuals who have all of these self-employment relation- a very low income over the long term are also unlikely to voluntarily Self-employed persons in certain sectors are compulsorily insured by ships are emerging in the legal grey make personal provision for old age. And finally, there are forms of law in the statutory accident insurance system (agriculture, the health area of platforms, crowds or the cloud. work which seem difficult to categorise as employment or a self- service, voluntary welfare organisations), while in other sectors people In many cases, however, economic depen- employed activity, which results in uncertainty around whether social are compulsorily insured based on the statutes of the occupational dencies develop between solo self-em- insurance is compulsory.192 « ac cident insurance fund in question, i.e. insurance coverage exists due ployed persons and major customers. « to a decision by the fund’s board of governors. Examples include the Industrial Mining, Chemical and Yet even if people are self-employed for most of their working life textile and clothing industry, the printing and paper industry, and hair- Energy Union (IG BCE) and make a good living, there is no guarantee that they are also mak- dressers. In all other cases, it is possible to obtain insurance coverage ing provision for old age, rather than relying on basic income support on a voluntary basis. Compulsory insurance on the basis of insurance benefits later in life. Often they also underestimate their future needs. funds’ statutes offers a system-compatible means of extending accident The fact is that many formerly self-employed persons are dependent insurance coverage to further groups in a targeted, sector-specific way.

190 Around 280,000 self-employed individuals are compulsorily insured in the statutory pension insurance system, and around 150,000 in the farmers’ pension scheme. In addition, an estimated 380,000 self-employed persons are members of professional retirement schemes. Around a further 420,000 are already drawing a statutory pension and/or are over 65. 191 Kreikebohm/Kuszynski 2011. 168 192 Zapfel 2013. 193 2016 report on provision for old age (Federal Ministry of Labour and Social Affairs 2016c). 169 Policy Options Policy Options

---» The key to viable self-employ- An important prerequisite for social protection is an adequate income. the coverage of social security and labour laws if existing civil-law ---» It is impossible to give a general ment is fees people can live on. « Small business owners with little bargaining power, especially self- standards are inadequate to ensure the protection of self-employed answer to the question of whether the 29 Apr. 2015 via arbeitenviernull.de employed contract workers, can often do little to counter the pressure forms of work. » service providers who use such platforms clients place on their pay. In addition, the statutory minimum wage are genuinely self-employed, or whether does not apply to them. They are at risk of ending up in a race to the A controversial debate about how crowdworking should be legally in certain circumstances pseudo self- bottom, which can be fuelled by the high level of price transparency on classified is taking place amongst legal scholars. Most voices in the employment can be assumed; an digital platforms. In some cases they are also competing against com- debate believe that crowdworkers are not employees in most cases, answer can only be reached on a panies which offer similar services, while working with employees in due to the lack of personal dependence, which is the constitutive char- case-b y-case basis. « jobs with compulsory social insurance coverage. Public fee scales only acteristic of all wage and salary employment: they argue that crowd- Conference of the Labour and ---» In terms of labour law, we see exist for a small number of occupations. « workers are not subject to instructions when performing work and can Social Affairs Ministers of the Länder no need for legislators to take action. The freely choose whether or not to take on an assignment. existing statutory framework is suffi- A contentious debate is taking place about the pay and working con- cient to cover this new development. « ditions offered by new forms of work for which digital platforms act as However, technical parameters and performance specifications can German Retail Federation (HDE) intermediaries (… Chapter 2.2). As well as platforms for highly quali- make explicit work-related instructions all but superfluous, as they fied skilled workers , there are platforms which act as intermediaries have already been implicitly issued via the framework defined for the for simple micro-tasks or physical services on demand. The partly over- assignment. If time specifications also apply and continuous monitor- lapping, partly conflicting interests of workers and consumers regarding takes place, for example via screenshots or the logging of work pro- ing digital platforms were also discussed during the consultation processes, or if customers rate the services performed, the criterion of cess.194 The focus was on the lack of transparency regarding working personal dependence can potentially be met after all. Personal depend- and pay conditions, particularly in light of recent developments in the ence is also the essential criterion in determining whether an indi- ---» The platform economy and “on field of crowdworking . Further criticisms include unfair contractual vidual should be classified as an employee under social insurance law. demand economy” require an extremely conditions, such as payment only for those who win a competition, and Indications of personal dependence include the individual acting on high level of one-way flexibility from the possibility for a piece of work to be rejected by the platform oper- instructions and being integrated into an external work organisation. It workers (...). This also applies to new ator without any reason being given. « seems that the question of whether this criterion is met has to be forms of work which are moving in the examined on a case-by-case basis for platform-based activities and direction of self employment. « Whether or not platform workers are carrying out a self-employed crowdworking . German Trade Union Confederation (DGB) activity can only be determined on a case-by-case basis. The key factors are the design of the legal relationship and the way in which the work SHAPING THE WAY AHEAD is actually performed. As most platforms define the legal relationship Business founders and self-employed persons take personal risks, not in their terms and conditions as self-employment, it is potentially a just for themselves, but often also for the public good. They should question of uncovering pseudo self-employment . The individual cases therefore be supported. This includes the provision of qualified coun- need to be decided upon by the competent courts or relevant adminis- selling. However, support for business start-ups is primarily a matter trative procedures, such as the pension insurance system’s status deter- for economic policy.195 Where aspects relating to labour market and mination procedure. In principle, it is the task of legislators to expand social policy come into play, they should take into account the eco-

194 As part of the consultation process, a symposium on “Service Platforms from the Perspective of Workers and Consumers: how can we achieve socially just and consumer-friendly standards?” was held jointly by the Federal Ministry of Justice and Consumer Protection and the Federal Ministry of Labour and Social Affairs on 20 September 2016, see www.bmas.de/DE/Presse/Mel- 170 dungen/2016/symposium-dienstleistungsplattformen-internet.html. 195 See Federal Ministry for Economic Affairs and Energy (BMWi) 2016; Keese 2016. 171 Policy Options Policy Options

nomic realities for self-employed individuals. Labour market policy can • The statutory pension insurance system goes beyond simple provi- help people to move from unemployment to self-employment. A range sion for old age and encompasses benefits to facilitate participation, of instruments are available for this purpose in Books II and III of the reduced earning capacity pensions and surviving dependants’ pensions, Social Code (Sozialgesetzbuch), including the start-up grant, new busi- which are often not offered by personal and occupational pension ness support, loans and grants for equipment, and funding for advisory schemes. services. These measures could be supplemented by a Personal Activity Account (… Chapter 4.8). Including self-employed individuals in the community of solidarity of the statutory pension insurance system would give them the same The question of whether, in the case of pseudo self-employment , rights and obligations as all other insured persons. At the same time, an individual actually has the status of an employee and thus enjoys special regulations for some groups are appropriate, particularly in order the full protection of labour and social law can be clarified in individu- to protect existing self-employed persons’ confidence in the decisions al cases by legal proceedings and administrative procedures such as the they have taken regarding provision for old age. The statutory pension status determination procedure. insurance obligation should therefore apply primarily to younger people who enter self-employment after the obligation enters into force. The fields of work for creatives are developing with particular speed There should also be greater scope to reduce contributions while set- and dynamism. In practice, this can make it difÿcult to make the necessary ting up a new business and in periods with low earnings. In addition, distinction between dependent employment and self-employment. As those who are already covered by an obligatory system should be entitled a frame of reference, the existing classification criteria lists could be to receive an exemption from the obligation of coverage by the statutory updated and further developed in consultation with the relevant actors, pension insurance system. This applies to farmers and freelancers who such as the Artists’ Social Fund and the social insurance agencies. are covered by professional retirement schemes, such as lawyers.

Since 2006, business founders have had the option of voluntarily retain- By contrast, an old-age security scheme for self-employed individuals ing unemployment insurance coverage if they have already been insured with low incomes modelled on the artists’ social insurance system, with for a certain period of time. This is primarily intended to provide a social contributions coming from self-employed persons themselves as well safety net for the difficult initial phase of starting a business. as clients and the state, does not appear to be an adequate solution.

In view of the problems which have emerged regarding provision for Unnecessary bureaucracy holds entrepreneurs back. In particular, the old age, it appears appropriate to require self-employed individuals to notification and contribution procedures in the social insurance system ---» As a freelancer in IT, I’m in make provision for old age, as is the case for employees. In other Euro- are often felt to be complicated and time-consuming. Bureaucracy has favour of compulsory social insurance pean countries, this has long been a matter of course. The aim is to close generally been slashed in the social insurance system’s contribution coverage for ALL. Then there would be existing gaps in coverage, reduce incentives for the crowding out of payment and notification procedures in recent years, which have been no more need for a law on pseudo self- employment, and avoid basic income support benefits being claimed adapted to allow data to be transmitted electronically. The Ministry employment and EVERYONE would at due to inadequate provision for old age. The appropriate way to achieve intends to establish an electronic notification process for compulsorily or least receive the statutory pension. « this is to include self-employed individuals in the statutory pension voluntarily insured self-employed persons in the future as well, using 24 Apr. 2015 via arbeitenviernull.de insuranc e system, as this offers the following advantages: « the same technology. • It will put an end to contribution histories in which contribution The introduction of an obligation to make provision for old age must periods in the statutory pension insurance system are interrupted by go hand in hand with a review of the non-income-related minimum periods of self-employment. Self-employed individuals will, like contributions for self-employed persons in the statutory health insur- emplo yees, receive a secure pension from a single provider. ance system. The relatively high contributions burden for those who

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have low incomes or are in the process of setting up a new business is one be adjusted, or whether new instruments are needed to give workers on cause of the high level of contribution arrears in the statutory health the borderline between employment and self-employment better insurance system in relation to this group. If all self-employed individuals means of collectively negotiating their working conditions and incomes. are made subject to an additional obligation to make provision for old age, the contributions burden could play a part in causing ÿnancial overstretch. At present, representative surveys in Germany offer no indication of a signiÿ cant increase in self-employed activities in the platform economy. To improve the income situation, there have been some calls for Although experts assume that there will be a rise in platform-based statutory fee scales for self-employed persons. Such approaches could services in the coming years, the available data calls for a degree of be problematic in terms of European law. The European Commission caution. The Federal Ministry of Labour and Social Affairs is seeking to takes the view that they could violate the Services Directive. Remuner- improve the available data on platform work. Empirical data on ation regulations can also be problematic due to infringements of Euro- crowdworking and other types of platform activities undertaken as a ---» It may be useful to carry out pean competition and antitrust legislation. main or secondary activity will form part of a regular reporting on an empirical study of crowdworking, structural changes in the world of work (… Chapter 5). If a rise in these cr eating an objective foundation for The economic and social situation of certain self-employed persons forms of work becomes apparent, new protection strategies would debate. « can, however, also be improved by means of collective agreements: have to be developed, tailored in particular to employee-like self- Confederation of German under Section 12a of the Collective Agreements Act (Tarifvertrags- employed workers. » Employers’ Associations (BDA) gesetz), it is already possible today for trade unions or professional associations which are authorised to engage in collective bargaining, A protective framework targeted at a speciÿc group has been created in for example, to conclude collective agreements for self-employed indi- the past, in the form of the Home Work Act (Heimarbeitsgesetz), which viduals, provided that these individuals are economically dependent provides for special regulations such as pay regulations and holiday allow- and have a need for social protection comparable to that of an employee, ances. A similar approach could be considered for platform workers or and are thus considered employee-like persons. Collective agreements certain types of crowdwork if new, precarious forms of work gain a foot- of this kind can, in addition to pay levels, cover issues such as entitlement h old in the German labour market due to an expanding platform economy. to fringe benefits, benefits in the event of incapacity for work, or holiday entitlement. This enables terms and conditions of employment to be With regard to boosting good working conditions in the digital plat- negotiated which re®ect the speciÿc nature of the sector in question. It is form economy, it has been shown that the connection between good up to the collective bargaining parties whether and in what way they working conditions and the delivery of high-quality services should be use this possibility of concluding collective agreements.196 As a first step, highlighted (… Chapter 4.3). the Federal Ministry of Labour and Social Affairs will do more to inform self-employed individuals about the possibilities which collective agreements can offer them. Additionally, in the light of new business models which exist in the grey area between self-employment and employment, it is essential to closely monitor whether the concept of “employee- like persons” still provides the intended protection, whether it needs to

196 At present, the register of collective agreements contains 44 collective agreements with provisions for employee-like persons. In 40 cases, these are “company agreements” in the radio and televi- sion sector. Just four other collective agreements are traditional collective agreements for an industry sector, in the graphic design sector (Framework and Collective Remuneration Agreement for Design) and the sector of newspaper publishers (Framework and Collective Wage Agreement). 174 This suggests that this instrument is underused by self-employed persons and their organisations. 175 Policy Options Policy Options

SUMMARY 4.8 THE WELFARE STATE: • Supporting self-employment and start-ups is an important task for economic policy in Germany. Labour market and social policies can FUTURE PROSPECTS AND provide flanking support for setting up businesses. EUROPEAN DIALOGUE • Solo self-employment has not risen further in recent years. Whether digitalisation will bring a new increase remains to be seen. Yet the line between employment and self-employment is blurring; this will be In a social market economy, a dialogue about the future of work will even truer in the digital world of work. In some cases, self-employment inevitably also look at the welfare state. The effects of digitalisation, glo- is a limited period in an individual’s work history, or is carried out as a balisation, and demographic and social change described in Chapter 1 are secondary activity. For all persons in work, including self-employed indi- not only challenges for the economy and the world of work. They also viduals, gaps in social protection should be avoided. raise questions regarding the welfare state, especially the social security systems which are directly connected to dependent employment. A • Against this background, it would be appropriate to include self- systematic analysis of these challenges would have been beyond the employed individuals, in principle, in the statutory pension insurance scope of the Work 4.0 dialogue. Instead, social-policy proposals have system. The associated costs must be assessed together with costs incurred been formulated from the perspective of the world of work, primarily in other social insurance systems, especially statutory health insurance. as a response to the impacts of digitalisation. What has emerged are the broad outlines of a vision of how to deal with fundamental challenges • Self-employed individuals should be encouraged to jointly assert for the welfare state of the future. their interests via collective bargaining structures. Greater use should be made of the existing legal possibilities, such as the option to conclude collective agreements benefiting self-employed “employee-like” persons. Steps are to be taken to improve the information available about this.

• Data collection regarding crowdworking as well as the prevalence of platforms and the work carried out through them needs to be improved.

• As one-size-fits-all regulations do not meet the needs of all self- employed individuals. Therefore, legislators should determine to what extent specific types of workers are in need of protection and include them in the protection afforded by labour and social law in line with their specific situation. A conceivable option would be to regulate crowdworking in a way which is based on the tried-and-tested, long- standing regulations for home workers.

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---» To ensure that digitalisation’s ISSUES RAISED IN THE CONSULTATION PROCESS dom in the organisation of work. Against this background, new redistri- ---» It must be ensured that the opportunities benefit the whole of What emerges from the responses to the Green Paper on Work 4.0 , bution strategies are being discussed in almost all western countries. social security systems themselves do German industry and its workers, as besides a clear, shared commitment to the social market economy, is how not come under pressure. « well as jobs in Germany, we need a widely views differ on the functions of the welfare state. While some SHAPING THE WAY AHEAD German Association for Social Security Research and Policy (GVG) viable social partnership and a demand comprehensive protection from the uncertainties of digitalisa- The first challenge for the welfare state is securing its long-term political framework which fosters tion, others emphasise the individual’s personal responsibility and call financing. This concern is raised in many of the responses to the Green innovation, avoids bureaucratic for the welfare state to limit itself to safeguarding minimum standards. Paper. It is not a new concern, having been the crux of social-policy ---» If jobs with compulsory social regulations and boosts While some underline the value of their entrepreneurial or individual debates in Germany, for example about provision for old age, for many insurance coverage are replaced by new entrepreneurial freedom. « freedom, others demand comprehensive, state-organised solidarity. years, including in the context of demographic change. By way of solu- forms of work, the question is how to Daimler AG While some refer to the primacy of negotiations between the social tion, there are calls on the one hand for the solidarity principle to be secure the revenues and ÿnancing basis partners in protecting and enforcing social standards, others regard strengthened by including broader groups in the social insurance sys- of the social insurance systems. « ---» There is already an adequate this primarily as a matter for the state. This is far from an exhaustive tems, while on the other hand greater tax financing for benefits is rec- Federal Employment Agency level of social security in this list of the contradictory positions. Above all else, however, this shows ommended. Fiscal aspects could only be considered on the margins of country for every individual. There is that the welfare state is a dynamic system in which society’s funda- the Work 4.0 dialogue, but a series of proposals to this effect, concen- ---» The whole social insurance no need for a further expansion. mental focus is debated, and that it must constantly re-establish its trating on digitalisation, are being discussed in the international debate. system should be re-focused on a single, That would only result in a more worth, re-adjust and re-invent itself. « They offer different strategies for the taxation of the digital economy: solidarity-based system. Both for bloated welfare state. « from a taxation of digital companies which focuses on data flows, for pensions and for health and accident Bavarian Industry Association (VBW) Internationally, the future of the welfare state is being debated in example, to a change in the distribution or calculation of social insurance insurance, everyone should pay into a more fundamental terms than in Germany. This is due to the view, held contributions to reduce the burden on labour as a factor of production, for single system, with additional personal ---» For years, ver.di has been primarily in the Anglo-Saxon countries but also advanced in Germany, example by using a value-added-based system to calculate employers’ forms of provision only being made by calling, together with the German that digitalisation will result in massive job losses.197 Although there is contributions199. Another widely discussed approach is to change owner- those who also want additional special Trade Union Confederation, Social no evidence of this in Germany to date (… Chapter 2.1), the fundamental ship structures in the digital economy, with, for example, citizens becoming benefits. Other European countries Organisation Germany and other discussion sparked by this hypothesis also has implications for German owners of their data and being paid for its use, or workers becoming (e.g. Austria) have never moved so partners, for social insurance for social policy. For the fear that an army of “digital labourers” might give shareholders in companies as part of an employee (equity) participation far away from the system of a commu- employees to be expanded to create a rise to a new “social question” is merging with an international debate scheme.200 Social policy will continue to grapple with these debates for nity of solidarity. « comprehensive social insurance scheme about the risks of excessive, and thus socially and economically dysfunc- years to come. » Bremen Chamber of Labour covering all persons in work. We tional, social inequality.198 Digitalisation, it is feared, could exacerbate reiterate this call, as it is taking on a existing divisions in societies and further reinforce inequality dynamics. The second challenge is ensuring that the benefits provided by the ---» The value of unpaid and new urgency when it comes to Key issues in this area include growing inequality in the distribution of welfare state are fit for the future. One particularly influential idea in voluntary work should, in our view, providing adequate social protection wealth, income divergence, the loss of jobs with compulsory social insur- the international debate is that of an “unconditional basic income ”, lead to higher pensions and lower for the new forms of work and ance coverage, the rise in precarious employment, the spread of poverty which has also been discussed in Germany for years and is gaining new taxes. Benefits relating to this, for employment which are potentially risks and the inadequate social protection offered by the welfare state for support in the face of digitalisation. The idea of a kind of basic income example in statutory health, pension increasing as a result of digitalisation. some groups. A new divide could also emerge if only elites were to bene- can already be found in Thomas More’s Utopia, published exactly 500 and unemployment insurance, should The entire labour force must be fit from the advantages of digitalisation, such as greater personal free- years ago, in which it is seen as a way of making theft unnecessary. The therefore be tax-financed. « included in the social insurance system. Social Insurance System Trade Union – Women’s Representation Employers and clients (as well as “intermediaries”) must bear an equal share of the costs. « United Services Trade Union (ver.di)

197 Ford 2015; Brynjolfsson/McAfee 2012; 2014. 198 The links between inequality and growth – including and in particular with reference to OECD and IMF publications – are discussed in the draft of the Federal Government’s Fifth Report on Poverty and Wealth, which was adopted in April 2017; see Atkinson 2016, Piketty 2013, 2015 and Stiglitz 2015 and, regarding the discussion in Germany, Fratzscher 2016 and Mau/Schöneck 2015. 199 Bach et al. (2016). 178 200 Freeman 2015. 179 Policy Options Policy Options

liberal-economic variant was formulated by Milton Friedman in 1962 partnership (… Chapter 4.5), or social protection for new forms of work ---» Work is a factor in individual with his concept of a “negative income tax”: he proposed that all social (… Chapter 4.6). The welfare state and its social security systems will social status and also an outlet for benefits should be replaced by a single sum paid by the state.201 The need to take more of a life-phase approach in future and provide better indi vidual creativity. For the Social various supporters of a basic income hope that it would result in a lean support for transitions. » I nsurance System Trade Union, the state which would free people from their dependence on both gainful principle of the social state guaranteed employment and social security administrations. They thus release the One instrument which could support a work-centric social policy by the German constitution is there- state from its responsibility to give individuals access to work and, in which is focused on individual needs is the idea of a Personal Activity fore also the yardstick for the future of the event of unemployment, to offer them support and assistance in a Account, which would be set up for all individuals entering working life the working world. Work is tradition- spirit of solidarity. and would accompany them throughout their working lives. The idea ally also the foundation for our social picks up on various academic proposals and builds on the French concept security systems. « ---» In view of the productivity There was no active discussion about a basic income in the Work 4.0 of a Personal Activation Account, which is to be introduced at the start of Social Insurance System Trade Union – Women’s leaps which are expected as a result dialogue, in part because the Federal Ministry of Labour and Social 2017. Three main aims would be pursued via the Personal Activity Account: Representation of progressive digitalisation and Affairs believes there is no need, or support within society, for such a automation, we must also ask how fundamental change of system. The introduction of a basic income Firstly, as it would be administered by a state service provider, it could ---» In view of the disparate nature of workers can benefit from this. « would mean moving away from the idea of a working society and accept- help to make it easier to transfer employees’ entitlements if they developments, we may have to get used Bremen Chamber of Labour ing the risk of a new divide between those who have work, and can change employer. Take long-term accounts , for example: the German to the idea of a future working world in therefore have a much higher income than the basic income , and those Pension Insurance already administers the credits in long-term accounts which labour markets contain employees, who are voluntarily or involuntarily dependent on the basic income – under certain circumstances. Automatically setting up this kind of ac- freelancers, solo self-employed individuals, without entitlement to state support in their efforts to gain access to work. count at the start of an individual’s working life could result in long- entrepreneurs and – even if no one wants Rather than the ideal held by many advocates of the basic income , i.e. term accounts , currently rare, becoming much more widespread, includ- this – a certain number of precarious expanding the concept of work beyond gainful employment and creating ing amongst small businesses and low earners. Administration by a state workers, and in which it is no longer an inclusive working society for all on the basis of a basic income , the service provider could also ensure that the credits are safely invested possible for a one-size-ÿts-all approach result could be the opposite: an exclusive labour market for the privi- and pay interest. to re¨ect their different wishes and needs. leged. Should automation and artificial intelligence result in work Of course, the aim of facilitating “good becoming more efficient and thus a reduction in the work available, Secondly, the account could empower workers to shape their employ- work” for them all would remain in place, there would still be other solutions for sharing the dividends of digital- ment biographies in a more autonomous manner by offering opportu- even in those circumstances, but the isation: for example, higher wages for fewer, more self-determined nities which they could use as they see fit. For example, the account instruments for achieving it would be working hours. « could conceivably come with an initial credit, which could be used for much more differentiated. « various clearly defined purposes over the course of an individual’s Federal Association of Human If any theory has proven to be robust in recent years, it is that of the working life: to fund, for example, continuing vocational education and Resources Managers (BPM) path dependency of the development of the German welfare state. training not paid for by employers, the process of starting a business or Rather than a change of system, the welfare state needs to be carefully making the transition into self-employment, reductions in working evolved in a way which reflects the public’s needs. The extent to which time or sabbaticals to raise children or care for a family member, or a work and the welfare state must continue to complement each other in flexible transition into retirement. future is visible in almost all of the policy areas discussed in this chapter, whether the focus is on securing employment opportunities, participa- Thirdly, the account could ensure greater social justice. It picks up on tion in work or minimum wages (… Chapter 4.1), safeguarding employ- the proposal made by various economists that, given the unequal dis- ability (… Chapter 4.2), the welfare state’s social protection for a life- tribution of inherited assets, a “social inheritance” should be intro- phase approach to the organisation of working time (… Chapter 4.3), duced: a one-off sum which the state would make available to all young securing social rights in the context of co-determination and social people, irrespective of their social background, which could only be

180 201 Friedman 1962. 181 Policy Options Policy Options

---» Gesamtmetall is opposed to the used for specific purposes. This would contribute to distributive justice Nonetheless, in the context of the European Monetary Union’s mac- ---» A European fiscal capacity various proposals for macroeconomic and intergenerational equity. The amount could potentially be set on a roeconomic stability, there is a need for instruments beyond the ECB’s could be considered, in the dbb’s view, stabilisation mechanisms in the form of sliding scale: for example, those who have not benefited from tax-financed monetary policy – which is uniform for all countries – even if a European subject to certain conditions. It would a European Unemployment Insurance higher education could receive a higher initial capital. Limiting the account unemployment insurance scheme is unlikelyto be the instrument of have to be defined as a specific-purpose scheme. Not only is the effectiveness of to new workers would also reflect the fact that younger people have to choice. The preparation of the multi-annual ÿnancial framework for 2021 European fund which is based on automatic stabilisers generally overesti- bear a higher demographic burden. to 2027 would seem to be a suitable forum in which to discuss a reform additional EU revenues (...). The dbb is mated; their countercyclical function is of ÿnancing ®ows at European level. For the sake of the future of European open to a careful examination of the also more than questionable. (...) The The concept of a worker’s account outlined here could be modified in integration, the EU must win back trust and demonstrate and use its possibility of a European instrument intr oduction of a European Unemploy- many respects. For example, sub-accounts could also be established ability to deliver on key issues: Community solutions are needed in modelled on the European Globalisation ment Insurance scheme, supposedly in for specific purposes, with different conditions of use applying. The economic, security and defence policy. In addition, a social agenda is Adjustment Fund which, in line with the an attempt to solve the problem via accounts could also be used by the social partners to reach specific needed which places social cohesion centre stage and tackles the causes existing use of structural funds, provides macroeconomic stabilisers, would create agreements. of poverty-driven migration within Europe. » European assistance in special social inappropriate incentives (...). Urgently crises and thus also has a stabilising needed reforms in individual Member The third challenge for the welfare state can be found in European The question of what “Gute Arbeit” looks like in the digital world effect on national labour markets. « States would be impeded. « integration. Social policy is primarily organised at national level. In should be discussed not just at national level but at European level as dbb – German Civil Service Federation Gesamtmetall – Federation of view of the EU’s economic and legitimacy crises, however, a recurring well. The EU’s Digital Agenda considers the issue primarily with regard German Employers’ Associations in the Metal debate is taking place about whether the EU needs to become more to initial and continuing training, with the aim of actively securing the In the dbb’s view, key factors in and Electrical Engineering Industries ---» tangible for EU citizens, and in particular to become “more social”, and supply of skilled labour. However, the approach should – like the con- achieving an employment-intensive ---» The Federal Employment if so, how. One example of this is the initiative launched by former EU sultation process in Germany – be wider and take into consideration world of Work 4.0 which preserves the Agency’s Board of Governors is Commissioner László Andor, who proposed that a European unemploy- the various dimensions of decent digital work. welfare state in Europe include a deep- opposed to a European ment insurance scheme should be established. His proposal aimed to er economic union, better coordination unemployment insurance scheme for supplement the existing national social security systems with an addi- A joint approach by the Member States could initially consist of for- of economic policies, and joint reform legal, social, distribution-policy tional transfer benefit, financed using Member States’ tax revenues, mulating minimum standards for workers which apply Europe-wide, efforts by the EU countries. « and economic reasons. « which would be paid Europe-wide. In Germany, the idea met with uni- without placing too great a burden on individual Member States. For dbb – German Civil Service Federation Federal Employment Agency versal opposition: in a rare display of unity, the responses to the Green example, this could involve European legal frameworks for setting natio- Paper on Work 4.0 reject the suggestion of a European unemploy- nal minimum wages, designing national basic social security systems, ---» Each country is responsible ment insurance scheme, albeit for varying reasons. « and establishing better minimum standards for the organisation of labour for the consequences of its mobility within Europe. Designing these legal frameworks must be a labour-market policy. « matter for the Member States, in line with established European practice. German Retail Federation (HDE) At the same time, the legal framework for the coordination of social security systems would have to be revised to protect the Member States ---» Solidarity within the EU is from unjustiÿed social beneÿt claims. In addition, the Posting of Workers necessary, but national insurance Directive, which has not been changed in twenty years, should be revised systems which have a limited pool of to protect workers posted across national borders. contributors and already many national gaps in protection are not a suitable means of tackling economic crises EU-wide. « German Trade Union Confederation (DGB)

182 183 Policy Options Policy Options

The consequences of digitalisation in the field of health and safety at SUMMARY work could also be discussed at European level. A dialogue about Work 4.0 • The key challenge for the welfare state in the era of digitalisation could take place not only in the framework of the Digital Agenda, but is to find stable, viable solutions which are compatible with the social also in the context of the discussion about the European Commission’s market economy and, at the same time, allow an adequate level of collec- proposal for the establishment of a European Pillar of Social Rights.202 tive social protection for the population. With this Pillar, the European Commission wishes to respond to the challenges relating to employment and social cohesion in the EU • An important dimension of this challenge is securing the long-term caused by the financial and economic crisis. At the same time, the Pillar, ÿnancing of the welfare state. The disparate trends in market incomes and like the consultation process Work 4.0 , is based on the fundamental assets, including in connection with digitalisation, will make it necessary idea that the world of work will be transformed by current and future for the tax and social security contributions system to evolve. Sufficient megatrends, especially the digitalisation of society and the economy. funding must be obtained for the welfare system to provide a socially The Pillar is intended to become a stand-alone reference document con- viable level of benefits. This is the prerequisite for minimising inequality. taining principles on the support for well-functioning, fair labour markets and social security systems. This approach provides an opportunity to • A major aim in further developing the welfare state’s institutions is to pragmatically engage in an urgently needed debate about the level at which stabilise employability over the life course and support transitions. The the European Union’s social dimension should be organised. Regarding concept of a Personal Activity Account would see young workers being the governance impetus to be developed, it must be ensured that tradi- given an initial capital, as a form of “social inheritance”, which could be tional national structures are respected, such as the collective bargaining used for skills development, starting a business, or career breaks for and staff representation systems in Germany. personal reasons. It could also be managed as a long-term account into which individuals could make their own payments. Many experts believe that the project of European integration is currently experiencing one of the most difficult phases in its history:203 a • Matters relating to the welfare state can only be meaningfully great deal of energy will need to be devoted to the consequences of developed further if the European context is taken into account. This is Brexit, while at the same time it is necessary to address the eurozone crisis especially true of the consequences resulting from digitalisation. The and its consequences, aid for millions of refugees, and security threats. Work 4.0 dialogue should therefore also take place at European level – Against this background, a broad consensus in society is needed, includ- both in the framework of the EU’s Digital Agenda and as part of the ing in Germany, about what kind of Europe we want and what we are discussion on establishing a European Pillar of Social Rights, which is willing to do to achieve it. This also means that labour and social policy ushering in a fundamental process of reflection on the European Union’s must not be discussed solely in the national framework; a shared Euro- social dimension. Public support for the EU could be boosted by, among pean level must be found. Work 4.0 can become a joint project for the other things, a fundamental consensus on minimum standards of social future, not just in Germany but at European level as well: because it protection, which could also reduce poverty-driven migration within promises progress which benefits everyone. Europe. A successful digital transformation which contributes both to greater prosperity and better working conditions within the EU could become a forward-looking project for the EU and its citizens which inspir es a sense of community and identity.

202 European Commission 2016. 184 203 See Enderlein et al. 2016 185 RE-IMAGINING WORK: IDENTIFYING TRENDS, TESTING INNOVATIONS, STRENGTHENING THE SOCIAL PARTNERSHIP

5 Re-imagining Work 5. RE-IMAGINING WORK: IDENTIFYING TRENDS, TESTING INNOVATIONS, STRENGTHENING SOCIAL PARTNERSHIP

The publication of this White Paper does not of course mark the end gree of work-related flexibility is desirable and necessary; the potential of the digital transformation, nor the debate around Work 4.0 . It will conflict between automation and securing employment; the repercus- continue over the coming years – true to the motto of this dialogue sions of new business models, often based on Big Data , as well as new process: “Re-imagining work”. Some sensational predictions may end forms of work – these are shaped by diverse values and interests. If the up being moderated, and new questions will be posed. transformation process is to lead to the greatest possible prosperity for society and its benefits be shared amongst as many individuals as pos- The consultation process has made clear that it would be a mistake sible, it will have to be continuously negotiated in many areas, and new to react hastily to early developments. However, it would be equally social compromises will have to be found. This will only be possible if wrong to wait until potentially problematic changes have become state action, social partnership, cooperation between employers and established and the repercussions for the labour market have to be works councils, and the concrete reality for companies and organisa- corrected retrospectively via social policy – potentially at a high cost. tions are considered holistically and function as a whole. With the aim Instead, it is worth continuing along the path established by this of making the vision of decent work and quality jobs as outlined in consultation process: observing trends, seeking dialogue within soci- Chapter 3 a reality, we are setting out four key principles: ety, taking a measured approach in terms of political action, and – wherever possible – pursuing the route of social compromise, with the in- Firstly: we want to be an innovative, learning society, in which we volvement of the social partners and other labour-market stakeholders. must also take new risks. Where individuals are confronted with new risks, new safeguards must be created. Not everything which is new The trend towards a digitalised world of work will continue in the and possible is necessarily good. But without developing further, our coming years. Clearer answers will emerge with respect to many cur- society would stagnate and our economy would lose its international rent questions: has the German economy managed to hold its own in competitiveness. Particularly with regard to the digital economy, we the face of international competition? Has Industry 4.0 become must find a way to combine innovation with the principles of the social standard in most companies – at least in industrial value chains and market economy . There is justified scepticism about whether some networks? Have companies seen an erosion of their physical bounda- business models; new, insecure forms of work; or approaches to data ries and become more “virtual”? What jobs have in fact been replaced which have, for example, been observed in the United States are the by robots and artificial intelligence , and in what areas will human right approach for Germany. We should focus on a German model, or minds and hands remain essential, even in the future? Where has new better yet a European model, for a strong digital economy and labour work been created? Has cloud-based and crowd-based work become market. the reality for many? Secondly: work and the welfare state must always be considered to- The present transformation process will not be conflict-free. The gether. In this context, the welfare state is facing the challenge of tak- challenges and tensions set out in this White Paper – such as what de- ing the entire life course of citizens into account, in particular focusing

188 189 Re-imagining Work Re-imagining Work

its social security systems to a greater extent on supporting people in investment in employee-health and ongoing education and training on the transitions between different life phases; ensuring that preventa- the other, play a key part in the recruitment of skilled workers and tive and follow-up measures are dovetailed in a useful way; and sup- ultimately in overall economic productivity. porting the social partners, workers and companies in reaching sensible flexible working arrangements by providing a high-quality, well-con- With this White Paper on Work 4.0 , we are documenting a broader nected social infrastructure. The welfare state and labour legislation debate in society and presenting initial conclusions from our dialogue, in will continue to guarantee fundamental social rights and statutory pro- the full knowledge that no definitive answers are yet possible. The trends tection for all employees. Where appropriate, these must be expanded, remain “under observation”, and we should experiment with new solu- for example around lifelong vocational education and training, which tions. we have proposed here. Further, we need to examine whether and to what extent those rights and obligations which have so far only applied We need better data on how the world of work develops over the to salaried employees should also apply to new forms of self-employ- coming years. The Federal Ministry of Labour and Social Affairs is ment, which require greater levels of social and legal protection. Look- therefore proposing the introduction of regular new reporting on the ing to the future, it must be clarified whether, in the light of the digital working world (Arbeitsweltberichterstattung), with the involvement of economy, new approaches to financing the welfare state and public academia and the social partners. This report should analyse the latest goods should be considered. research, supplement and bring together existing data sources in useful ways and, where necessary, develop and apply new data sources. As a Thirdly: despite all modern developments, collective bargaining “map of the world of work”, it should provide a cross-section of how autonomy and co-determination will remain important institutions certain forms of employment, working times and issues relating to in the digital economy, enabling tailored solutions and flexible quality of work are developing in individual sectors; and which social compromises to be negotiated. The state can and will leave space for groups are active in these forms of work. negotiated solutions. Conversely, however, it is also the case that in areas where the social partners are not – or no longer – capable of The working world report should focus in particular on the extent to solving problems alone, the state will have to step in – as with the which contentious issues, such as theories of task-automation, the po- recent introduction of the minimum wage. larisation of work, and the transformation of how work is organised, are becoming a reality. In addition, the report should offer a longitudi- Fourthly: all rules and principles, whether established by the state or nal analysis of the life-course of workers, and provide information via collective bargaining, must also be accepted and put into practice about where barriers exist: particularly around professional develop- by companies and organisations. Corporate culture as it is lived in prac- ment opportunities, access to an adequate income, and sufficient pro- tice – from communication and management practices, to forms of vision for old age. This includes a differentiated analysis of standard employment, to human resources management – is the crucial factor in employment relationships and “non-standard employment”, especial- embedding real change. Objectives such as sovereignty over working ly from the perspective of whether individual types of employment of- time , good occupational health, skills development and employee par- fer security and whether or not these forms of employment correspond ticipation can ultimately only be achieved if there is a workplace culture with individual preferences and needs. We want to engage in dialogue which fosters self-management and mutual support, and which respects with the academic community about whether we need new analytical jointly defined boundaries. Health is a precious asset and has a massive categories in this area. These reports on the working world should be influence on quality of life, performance capacity, innovative capabilities closely linked with the new monitoring of skilled labour referred to in and motivation. For this reason, physical and mental health, workers’ Chapter 4.1. Each report could conceivably also take an in-depth look well-being and the resilience of the entire organisation are vital factors at a key issue. in competitiveness. A good corporate culture on the one hand, and

190 191 Re-imagining Work Re-imagining Work

As an important prerequisite for new “flexibility compromises”, we We need a new government-wide innovation, research and transfer should examine further incentives and instruments with which we can strategy “Work 4.0”. The Federal Government’s existing research fund- support social partnership, collective bargaining coverage and the ing and transfer capabilities should therefore be coordinated and ex- establishment of works councils. Rather than simply seeking to slow panded if necessary. In order to disseminate knowledge and resources the long-standing erosion of collective bargaining coverage and em- to organisations, regional innovation and advice centres should be ployee representation in the workplace, we should be endeavouring to funded to inform and advise businesses, works and staff councils about reverse the trend, without, of course, calling the principle of freedom of technological and social innovations. association into question. The Federal Ministry of Labour and Social Affairs has already started to design laws in such a way that they can In consultation with the social partners, we should agree on topics contribute to this – for example, the law to prevent the misuse of to be piloted – what we here have called ‘experimental spaces’ – contract- and temporary agency work, or the draft law to strengthen with the aim of implementing these across sectors and in organisations occupational pensions. More widely, any new laws and initiatives put with academic support. The results should also be discussed jointly forward by the Federal Government which have a bearing on the econo- with the Federal Government, the social partners, academia and the my or the labour market, should also be examined in the context of their Länder. Such experimental spaces could, for example, look at: impact on social partnership and collective bargaining. There is no contradiction between individual direct participation, as is currently being • Changes in the law or derogation clauses, for example in relation to piloted in some companies, and institutional co-determination . On the flexibility in working time and location, and an examination of their contrary: the aim is to achieve a productive mix of statutory rights of effects (¢ Chapter 4.2); co-determination and direct opportunities for employee participation. • Pilot projects for strategic public funding , for example a nationwide We want a phase of joint “learning in and from transformation” and pilot project for offering further digital qualifications (¢ Chapter 4.1) to experiment with new strategies. In the 1970s and 1980s, the Federal or a regional trial of a ‘household services account’ (¢ Chapter 4.3); Government monitored and responded to the changes taking place, especially in industrial production, with its “Humanisation of the Work- • The interaction between human beings, new technology and new ing World” programme. This was followed by further programmes, organisational and participatory strategies in organisations, especially including today’s “Future of Work” research programme run by the around innovative approaches to improving working conditions Federal Ministry of Education and Research. Additional research and (¢ Chapter 4.4) and boosting employee participation (¢ Chapter 4.6); transfer projects are needed with regard to work in Industry 4.0 , but also more widely. Work in the trade- and service-sectors, new digital • New business models and organisational forms reflecting the princi- business models and self-employed forms of work must also be ples of decent work, such as non-profit platforms which seek to promote included. and spread the services of the sharing economy in the form of cooperative or social investment projects (¢ Chapter 4.3). The changing needs of workers must also be taken into consideration. Market and technological innovations must go hand in hand with The institutional lead for driving these experimental spaces and for social innovation. One vital aspect of this is putting workable and the transfer of innovation is the existing New Quality of Work Initiative , effective solutions into practice on the ground, within businesses. organised around a system of social partnership.

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We need an intensive debate in order to reach a consensus in society on the way forward for the welfare state and its social security systems. To this end, there is a need for an open culture of political debate, social-policy research, and suitable forums and formats within which policy-makers, the social partners, academics and civil society can find answers to the three main questions regarding the future of the welfare state:

• How can the long-term funding of the welfare state and its social insurance systems be secured even amidst the digital transformation of the economy?

• How can a welfare state which takes an overarching life-course approach be organised, what requirements must it meet, and how must the social security systems be modified with this in mind? What role could a Personal Worker’s Account play in this context?

• What could a vision of a social Europe look like which maintains national competences for existing social security systems, but at the same time taps into the potential for common European solutions which are tangible for citizens?

We are confident, in light of the broad and serious discussion which has taken place in the framework of the Work 4.0 dialogue, that these RE- vital debates can make a real difference on the ground. IMAGINING WORK

194 195 ANNEX

GLOSSARY BIBLIOGRAPHY RESPONSES TO THE GREEN PAPER ON WORK 4.0 THE CONSULTATION PROCESS ADVISORY GROUP EXPERT DIALOGUE WORKSHOPS FUTURALE IMPRINT Annex Annex

GLOSSARY Crowdworking Design thinking the income risks in the event that an individ- Crowdworking involves work, usually Design thinking is an approach to team- ual becomes unemployed, but also for in- broken down into smaller tasks, being based creative problem-solving which is come and employment risks connected with assigned to crowdworkers via digital characterised by a strong focus on the needs work-related transitions and career breaks proposals at national and international sational entity with legal capacity for the Algorithm platforms. Work can be assigned either of future users of the solution to be devel- over the life course, while at the same time level regarding the specifics of how such pursuit of business or non-material objec- An algorithm is a procedure for solving to a company’s own employees (internal oped; it is an iterative and highly interdisci- opening up opportunities for fresh starts and a system could work. tives. Co determination and participation a mathematical problem. Implementing crowdworking) or to third parties (external plinary approach. The term comes from the professional advancement. Key elements of at the workplace level refer primarily to algorithms in program code can enable crowdworking), who are often solo self- fact that this approach is based on the meth- employment insurance include a lifelong ad- Big Data the works council’s influence on all mat- computers to calculate solutions to certain employed persons working for many ods used by (industrial) designers. visory service, the establishment of a legal “Big Data” refers to the collection of ters affecting workers directly in the work- problems, for example in the context of customers worldwide. entitlement to continuing vocational educa- processing Big Data to produce Smart ever larger volumes of data, which can be place. The participatory rights are varied Digital literacy tion and training, and a working time policy systematically analysed due to technical and include, in particular, social, human Data. Cyber-physical systems Digital literacy refers to the knowledge which supports transitions and periods of advances in terms of processors and sen- resources and business matters, such as These are systems consisting of intercon- and skills required in the use of new tech- skills development. sor technology, but also in terms of analy- the introduction of short-time work or Artificial intelligence nected devices, machines and movable nical devices and the associated informa- sis methods (“Smart Data”). overtime, the establishment of pay princi- Artificial intelligence is a subfield of objects, which are controlled using IT tion and communication networks. End of work ples or piecework and premium bonuses, computer science. It seeks to develop and continuous data exchange. Devices For over a century, people have been pre- Blended learning the introduction of new technical systems programs and machines which, in certain and objects are equipped with sensors Digital transformation dicting the end of work due to productivity Blended learning combines elements of or work processes, and the development subfields (e.g. image and speech recogni- which constantly produce data about their The digital transformation is the sum of the gains from technological advances. While traditional, in person learning and ele- of social compensation plans in the event tion), have abilities which are associated status, location, process progress and user changes which may result from rapid and entire sectors and occupations have some- ments of self-learning, using electronic of the planned closure of a workplace or with human intelligence. These abilities behaviour. These interconnected systems widespread adoption of new information times vanished, new business models and aids such as online tutorials (“e-learning”). other substantial changes at the workplace are based on “machine learning”, among enable automated and autonomous plan- and communication technologies in the occupational profiles emerged at the same level. Employees’ interests are represented other things. Programs and machines ning and management of manufacturing economy and in society. They all individual- time. It is therefore more a question of Boundaries between work by the works council. Participatory rights learn from the examples they are given and logistics processes. ly, and especially in combination, have the changes and shifts in the labour market. and private life at company level concern business plan- and derive general rules from large potential to transform the way in which we The use of modern information and ning and decision-making. Corporate co- quantities of unsorted data. Cyber security work and do business. European General Data communication technologies is breaking determination takes place in companies’ Cyber security deals with all aspects Protection Regulation down the boundaries between work and supervisory boards. Assistance/tutoring systems of ICT security in cyberspace as a whole. Employability The General Data Protection Regulation private life, with a new openness replacing Digital assistance or tutoring systems This encompasses all connected informa- According to the Federal Institute for Occu- adopted by the European Parliament on the structures previously imposed by the Collective bargaining coverage give users additional situation-specific tion technology and includes all communi- pational Safety and Health, employability is 14 April 2016 after several years of negotia- company in terms of location, time and Under Section 3 of the Collective information about a process or a product – cation, applications, processes and generally understood as the ability to par- tions will apply from 25 May 2018, replac- organisation, in the form of fixed working Agreements Act (Tarifvertragsgesetz), via displays, mobile devices such as tablets processed information based on it. ticipate in working life. Individual employa- ing the EU Directive on the protection of hours and workplaces and the staff’s the members of the parties to a collective and smartphones, or data glasses – and bility depends on the requirements of the individuals with regard to the processing long-term attachment to the company. agreement (trade unions, employers’ asso- can be used to provide instructions, tech- Data minimisation working world, on the one hand, and the in- of personal data and on the free movement ciations) are bound by that collective nical support or continuing training in the The principle of data reduction and data dividual’s personal, specialist, social and of such data, which dates from 1995. The Cloud technologies agreement. Employers which have con- working process. Intelligent assistance minimisation enshrined in Section 3a of the methodological skills, personal health and new Regulation aims to harmonise data Cloud technologies make it possible to cluded a collective agreement directly (as a systems “learn” from past interactions Federal Data Protection Act (Bundesdaten- ability to work, on the other. protection standards and rules in Europe. access centrally stored data relating to a party) are also bound by it. Parties remain with individual users. Outside of working schutzgesetz) stipulates that efforts must It applies directly in all Member States, i.e. process from any location via the internet, bound by the agreement until it ceases to processes, digital assistance systems are be made from the outset, in the develop- Employee data protection without further national implementing acts and to work with this data, including by be in force (in other words, employers increasingly also being used to support ment, selection and design of specific data Legal provisions dealing with the collection, being required. National legislators have using supplied processing and analysis continue to be bound by it even if they consumers. processes, to ensure that no personal data, processing and use of employees’ personal until 25 May 2018 to align existing national software. leave the employers’ association, and it re- or as little as possible, is processed. data in the context of their employment are provisions with the Regulation. With regard mains binding until it expires or is termi- Basic income summed up by the term “employee data to employee data protection, it contains an Co-determination nated, for example). “Collective bargaining The term “basic income” – or often Democratic participation protection”. “opening clause” which allows the Member Germany’s co-determination laws ensure coverage” generally means the proportion “unconditional basic income” or “UBI” – The terms “democratic participation” States to introduce provisions in specific that workers have a say both in working of employees whose employers are bound is a social-policy approach under which or the “democratic enterprise” refer to Employment insurance areas. conditions and in business planning and by a collective agreement, out of all em- all citizens, without distinction, without staff involvement which goes beyond The term “employment insurance” means a decision-making. The two levels of institu- ployees who fall within the scope of the means-testing and without being required co-determination, such as their involve- fundamental strengthening of the preventive Experimental spaces tional co-determination are the workplace, collective agreement in question. to do anything in return, receive a set ment in strategic developments or the focus of unemployment insurance. The core Experimental spaces are an instrument to as the unit for the pursuit of work-related amount as a public transfer benefit on a organisation of work. idea is to provide a safety net not only for promote innovative and tailored solutions regular basis. There are a wide range of objectives, and the company, as the organi-

198 199 Annex Annex

for workers and companies which can provider, a “one-off” assignment or job merge on the basis of what are known as care leave or parental leave, or for purposes New Quality of Work Initiative wage distribution relative to those in the win support from all sides, based on arranged via a digital intermediary. The cyber-physical systems. This permits highly agreed with the employer – e.g. continuing (INQA) middle, for example. agreements between the social partners. provider is not hired for a permanent efficient and flexible production, with cus- vocational education and training, a sabbati- The New Quality of Work Initiative is a In experimental spaces, the social partners position. The platform operators assume tomer wishes being taken into account in cal or the transition into retirement. They joint initiative by the Federation, the Proportionality (data protection) can try out approaches to contentious is- in their terms and conditions that the real time, and allows a large number of thus enable individuals to shape their own Länder, the social partners, chambers, The principle of proportionality means sues relating to the organisation of work in service providers are self-employed. product variations to be produced. working lives. The legal provisions permit a the Federal Employment Agency, academia that personal data must not be processed practice for a limited period of time, with wide range of options. The specifics can be and the business community, which advo- or used any longer than required by the an open mind as to the outcome and with Green Paper Informational privacy agreed by employees and employers. cates an employee-focused corporate specific permissible purpose for which it academic evaluation of the results. These A Green Paper is a (normally in-depth) In German federal law, the right to infor- culture and develops approaches to the was collected. approaches can take place within the statu- discussion paper on a specific topic or mational privacy is the right for individuals Low-wage sector organisation of work which have a positive tory framework. However, legal changes group of topics which is intended to to control, in principle, the disclosure and The low-wage sector is defined in terms influence on motivation, health and inno- Prosumer (“opening clauses”) for a fixed period of launch a public and academic discussion. use of their personal data. of the relative low-wage threshold. This vation, going beyond the legal minimum The terms “prosumer” and “prosumption” time may also be necessary. Experimental A Green Paper summarises information, is generally defined as two-thirds of the standards. It offers advisory and informa- describe the phenomenon of consumers spaces can be used to try out new working defines problems, raises questions, and Internet of Things median hourly wage. In 2012, the national tion services, opportunities for dialogue, being directly involved in production pro- time models, approaches to how people sets out alternative courses of action for Modern information technology makes it low-wage threshold was 9.30 euros per and a programme to support new prac- cesses via digital media. interact with new technology and new or- debate. A Green Paper is often followed possible for almost any object, whether hour. 24.4 per cent of all workers were tice-oriented services for workers and ganisational and participatory strategies in by a White Paper outlining official meas- ordinary household items or machines in active in the low-wage sector in 2013. companies. Pseudo self-employment organisations, and new business models ures and proposals – as an answer, so to factories, to be equipped with ubiquitous Pseudo or sham self-employment exists and organisational forms, for example. speak, to the questions raised in the Green computing power, controlled via software, Migrant background Non-standard employment when contracting parties describe a legal Paper. The Federal Ministry of Labour and and connected with the rest of the world Individuals have a migrant background relationships relationship as self-employment, even Family working time model Social Affairs published the Green Paper and each other via the internet. if they or at least one of their parents Non-standard forms of employment though the actual design and conduct The family working-time model is on Work 4.0 in April 2015, launching a were not born with German nationality. include part-time work (under 20 hours of the relationship constitutes wage and designed to allow couples to share broad process of dialogue and discussion Knowledge society Specifically, this definition encompasses per week), marginal employment, fixed- salary employment, in legal terms. work and family commitments in a spirit on the future of work. In a knowledge society, knowledge and its immigrant and non-immigrant foreign term employment and temporary work. of partnership. Both engage in paid em- organisation are the foundation of society nationals, immigrant and non-immigrant Purpose limitation (data ployment with a substantial number of Humanisation of work and a vital economic resource which deter- naturalised citizens, ethnic German re- Part-time trap protection) weekly working hours (e.g. around 80-90 This term means that the world of work mines the competitiveness of economies to settlers, and the children of these groups The “part-time trap” refers to a situation The purpose limitation requirement in per cent of a full-time position) and share should, as far as possible, be adapted to a large degree. Work increasingly takes the born with German nationality (definition in which individuals find that, although the context of data protection is intended family commitments. In this context, dif- the worker. It encompasses all measures form of knowledge work and mental tasks. used by the Federal Statistical Office). part-time employment reflected their to ensure that data is only processed for ferent models are also being discussed for intended to enhance work content and Access to and sharing in knowledge via wishes at one phase in their lives, it the purpose for which it was collected. a public wage replacement benefit, which working conditions. Humanising the world education is a central social issue in this Mobile working becomes a “trap” later in working life The purpose is determined by the specific would provide incentives for both parents, of work was the aim of various approaches – context. Mobile working refers to work outside as they want but are unable to increase task for which the data was collected. Data as well as single parents, to engage in paid especially in the 1970s and 1980s – to the workplace. It includes working from their working time. The term also refers may only be processed for a reason other employment within a specific weekly designing working conditions at the work- Life-phase approach home (telework, alternating telework), to disadvantages in working life which than the original purpose on a statutory working time corridor. place level which were initiated or sup- A life-phase approach to working time en- working at customer locations (e.g. ser- are often associated with part-time basis or with the consent of the individual ported by the state, trade unions and the ables employees to reduce their hours in vices or sales), working on the go (e.g. in employment, such as lower chances of concerned. Generation Y academic community, particularly in the certain life phases, e.g. when starting a planes and hotel rooms) and working professional advancement, lower levels Generation Y refers to the demographic framework of the “Humanisation of Work” family or undertaking continuing vocational during business trips (e.g. trade fairs, of participation in continuing vocational Scrum cohort born between 1985 and 2000. programme (1974–1989) launched by for- education or training, so they can better conferences). education and training, or a lower inde- Scrum is an approach to managing team Members of Generation Y are believed mer Federal Research Minister Hans Matt- balance the various demands on their time. pendent income and smaller pension. projects which emerged in the IT industry to place much more value than older höfer. The New Quality of Work Initiative Necessity (data protection) (software development) in the 1990s and generations on the meaningfulness of is continuing this tradition. Long-term accounts The collection, processing and use of Polarisation is increasingly also applied to project their work and on a work-life balance. Long-term accounts – referred to in the law personal data is only necessary if the When demand for mid-level qualificatio ns development in other sectors. Scrum is Industry 4.0 as “credits” – enable employees to “save task in question cannot or cannot fully declines relative to the demand for both characterised by self-organising project Gig economy Industry 4.0 describes a revolution in the up” portions of their pay or time worked in be carried out without the data in higher-level and lower-level qualifications, teams and regular reviews of interim In the gig economy, services are offered manufacturing sector. At the heart of In- order to later take time off work for longer, question. This criterion is also met if for example as a result of technological results, potentially followed by dynamic via online intermediary platforms. Each dustry 4.0 is a highly automated and inter- socially insured periods. Credits can be used the task could otherwise only be carried advances, this can result in wage or em- adjustments to process planning. instance in which these services are connected industrial production and flexibly to allow workers to take time off out with disproportionate difficulty, ployment polarisation. This can lead to a provided is an individual “gig” for the logistics chain. Virtual and real processes for purposes defined in legislation, such as unreasonable effort or a delay. rise in wages at the top and bottom of the

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Sharing economy which combines free participation for all transaction costs within the company). world of work. “Work 1.0” refers to the working time to be tailored to better re- The basic idea of the sharing economy in an economy based on competition with birth of the industrial society in the late flect employees’ individual needs. is for resources which are not constantly social equity and socially compatible pro- Transparency requirement (data 18th century and the first workers’ organi- used by a single person to be temporarily gress in society. protection) sations. “Work 2.0” was the beginning of Work intensification used by others, with online digital plat- Every application which can be used on- mass production and the birth of the wel- Work intensification describes an increase forms generally acting as intermediaries. Solo self-employed persons line must inform users about the process- fare state in the late 19th century. Industri- in the work which is, or has to be, carried The term is closely linked to that of “col- Self-employed individuals who do not em- ing of their personal data and about the alisation led to new social problems; out in a specific period of time. It can be laborative consumption”. The European ploy any staff are generally known as solo data controller. Users can only exercise growing pressure from organised labour caused by a rise in time and performance Commission, for example, refers to the self-employed persons. their individual rights if they learn what was an important factor in the introduction pressure due to factors such as staff short- “collaborative economy” in the context personal data is being collected and for of the first forms of social insurance in the ages, rationalisation, phases of high work- of the sharing economy, and uses this Standard employment what purposes, what the data processing German Empire. “Work 3.0” covers the peri- load in the company, or changed term for both non-profit and for-profit relationship structure looks like, how the data is pro- od in which the welfare state and workers’ workflows. Work intensification does not models. In fact, there are many arguments The Federal Statistical Office defines a cessed, and who the data controller is. rights were consolidated on the basis of the necessarily lead to an increase in labour in support of reserving the term “sharing” standard employment relationship as a social market economy. Employers and em- productivity. for non-profit examples. permanent employment relationship in Trust-based working time ployees negotiated with each other on an which the individual works full-time or Trust-based working time is a model for equal footing, as social partners. The need Skilled workers part-time (at least 21 hours per week). organising work in which employees carry for representation of common interests was Individuals who have completed a voca- In addition, individuals in a standard em- out their duties autonomously within an unquestioned in companies and among tional training programme lasting a mini- ployment relationship work directly in the agreed period of time. This system does workers. Later, some social rights were re- mum of two years are considered skilled company with which they have a contract not involve formal time and attendance voked, partly as a result of growing com- workers. These are people who have com- of employment. This is not the case for recording in the workplace, or attendance petitive pressures and the opening of pleted an apprenticeship or hold a techni- temporary workers, who are assigned by monitoring by supervisors. Employees can national markets. “Work 4.0” will be more cal college certificate, a degree from a their employer – the temporary agency – set their own hours and often also choose interconnected, digital and flexible. It re- university or university of applied sciences, to other companies. their working location. The work to be mains to be seen exactly what the future or an equivalent qualification. performed is usually managed via target world of work will look like. Time sovereignty agreements and a team- or project-based Smart Data In general, time sovereignty means that an approach to organising work. However, Working time choice The data generated by billions of devices, individual has control over how to use his the employer continues to have a respon- The term “working time choice” refers to machines and systems in the Internet of or her own time. In the narrower sense, it sibility to ensure compliance with the various approaches proposed in the public Things (Big Data) can be analysed, linked refers to workers being able to determine working time provisions in the law and in debate. These range from the Working and interpreted with the aid of intelligent the length and scheduling of their work- collective agreements. Time Choice Act proposed by the German software. Data processed in this way is ing time. Women Lawyers Association, to the intro- called “Smart Data”, and forms the basis Value-added-based system duction of working time corridors, to the for the development of smart services. Transaction costs The financing of Germany’s social security use of “working time choice” as an over- Transaction costs are costs which, rather systems is primarily linked to labour, with arching term for models allowing flexibility Smart Services than being incurred in the production of employers’ social security contributions in working time and location, such as flexi- Increasingly, the line between service goods or services, arise in the use of mar- being calculated on the basis of gross time and long-term accounts, alternating providers and product manufacturers is ket processes to exchange them: informa- wages. In a value-added-based system, telework or trust-based working time. The disappearing. Smart services are linked tion costs, the costs of contract initiation, employers’ social security contributions Federal Ministry of Labour and Social Af- to the sale of a product (or in some cases conclusion and implementation, trans- are calculated on the basis of the compa- fairs understands “working time choice” as render its sale superfluous, for example in portation costs, etc. An essay by Ronald ny’s value added. referring to entitlements, enshrined either leasing/usage models) and offer comple- Coase, who received the Nobel Prize at the workplace level, in collective agree- mentary services related to the product, in economics, advanced the idea that it is Work 4.0 ments or as individual rights, for em- especially services based on analysis of efficient for work or production processes The term “Work 4.0” picks up on the cur- ployees to have a say in the length and usage data (e.g. intelligent predictive to be carried out within a company pro- rent discussion about the fourth industrial scheduling of their working time and in maintenance of machines). vided that the costs of obtaining a good or revolution (Industry 4.0), but puts forms of the choice of their working location, on service via the market, including the trans- work and employment relationships centre the basis of negotiated flexibility. Working Social market economy action costs involved, are higher than the stage – not just in the industrial sector, but time choice is thus a guiding principle for This term describes an economic system internal costs (taking into consideration in the entire a range of measures which aim to allow

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Freeman, Richard B (2015): Who owns the robots rules the world: Workers can benefit from technology that substitutes robots or Himmelsbach, Elke; Gensicke, Miriam; Hartmann, Josef (forthcoming): Lage der Arbeitszeit. Empirische Ausgangslage und Beschäf- other machines for their work by owning part of the capital that replaces them. IZA World of Labor 2015:5. Source: http://wol.iza. tigtenwünsche. Kurzexpertise im Auftrag des BMAS, Berlin. org/articles/who-owns-the-robots-rules-the-world/long. Hinte, Holger; Zimmermann, Klaus F. (eds.) (2013): Zeitenwende auf dem Arbeitsmarkt. Wie der demografische Wandel die Erwerbs- Frey, Carl Benedikt; Osborne, Michael A. (2013): The Future of Employment: How Susceptible are Jobs to Computerisation? Oxford. gesellschaft verändert, Bonn.

Friedman, Milton (1962): Kapitalismus und Freiheit. Munich 2006, p. 227–231 (English: Capitalism and Freedom: Fortieth Anniver- Hipp, Lena; Kelle, Nadiya (2015): Nur Luft und Liebe? Die Entlohnung sozialer Dienstleistungsarbeit im Länder- und Berufsvergleich. sary Edition 2002). Forum Politik und Gesellschaft, Friedrich-Ebert-Stiftung, Berlin.

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German Confederation of Small and Medium Sized Enterprises (Bundesverband mittelständische Wirtschaft – BVMW) (2015): Hofmann, Josephine; Nøstdal, Rita (2014): Einsatz, Bedeutung und Rechtliche Stellung von externen Spezialisten in Organisationen, Stellungnahme zum Grünbuch, p. 4. Studie im Auftrag der Hays AG, November 2014.

German Ergonomics Society (Gesellschaft für Arbeitswissenschaft – GfA) (1999): Selbstverständnis der GfA, Dortmund. Hofstetter, Yvonne (2016): Sie wissen alles. Wie Big Data in unser Leben eindringt und warum wir um unsere Freiheit kämpfen müssen, Munich. German Trade Union Confederation (Deutscher Gewerkschaftsbund – DGB) (2015): Stellungnahme zum Grünbuch, p. 11. Hornung, Gerrit; Hofmann, Kai (2015): Datenschutz als Herausforderung der Arbeit in der Industrie 4.0. In: Hirsch-Kreinsen, German Trade Union Confederation (Deutscher Gewerkschaftsbund – DGB) (2007): Mobile Beschäftigte – Beschäftigte mit wech- Hartmut; Ittermann, Peter; Niehaus, Jonathan (eds.): Digitalisierung industrieller Arbeit. Die Vision Industrie 4.0 und ihre sozialen selnden Arbeits- und Einsatzorten. Ein Bericht auf Basis der Erhebung zum DGB-Index Gute Arbeit 2007. Internationales Institut Herausforderungen, Baden-Baden. für Empirische Sozialökonomie (INIFES), Stadtbergen. Hupfeld, Jens; Brodersen, Sören; Herdegen, Regina (2013): Arbeitsbedingte räumliche Mobilität und Gesundheit. IGA-Report 25, Essen. German Women Lawyers Association (Deutscher Juristinnenbund – djb) (2015): Konzeption eines Wahlarbeitszeitgesetzes. Source: www.djb.de/themen/wahlarbeitszeit/wazg-konzept/. Institute for Employment Research (Institut für Arbeitsmarkt- und Berufsforschung – IAB) (2016a): Durchschnittliche Arbeitszeit und ihre Komponenten. Source: http://www.iab.de/de/daten/arbeitsmarktentwicklung.aspx. Gordon, Robert J. (2015): Secular Stagnation: A Supply-Side View, American Economic Review, 105 (5), p. 54–59. Institute for Employment Research (Institut für Arbeitsmarkt- und Berufsforschung – IAB) (2016b): Pilotierung Weiterbildungs- Gottschall, Karin; Voß, G. Günter (eds.) (2003): Entgrenzung von Arbeit und Leben. Zum Wandel der Beziehung von Erwerbstätigkeit beratung, Endbericht, Nuremberg. und Privatsphäre im Alltag, Munich/Mering. Institute for Social Research (Institut für Sozialforschung und Gesellschaftspolitik – ISG) (2016): Implementationsstudie zur Pilotie- Grass, Karen; Weber, Enzo (forthcoming): EU 4.0 – Die Debatte zu Digitalisierung und Arbeitsmarkt in Europa. IAB-Discussion rung der Weiterbildungsberatung. Endbericht im Auftrag der Bundesagentur für Arbeit, ISG-Projektbericht, 27 April 2016, Cologne. Paper 39/2016.

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Ittermann, Peter; Niehaus, Jonathan; Hirsch-Kreinsen, Hartmut (2015): Arbeiten in der Industrie 4.0 – Trendbestimmungen und Mayer-Ahuja, Nicole; Wolf, Harald (eds.) (2005): Entfesselte Arbeit – neue Bindungen. Grenzen der Entgrenzung in der Medien- arbeitspolitische Handlungsfelder, Hans-Böckler-Stiftung Study No. 308, July 2015, Düsseldorf. und Kulturindustrie, Berlin.

Kalina, Thorsten; Weinkopf, Claudia (2015): Niedriglohnbeschäftigung 2013: Stagnation auf hohem Niveau. IAQ-Report 2015-03. Mazzucato, Mariana (2014): Das Kapital des Staates – Eine andere Geschichte von Innovation und Wachstum, Munich (English: The Entrepreneurial State. Debunking public vs. private sector myths). Keese, Christoph (2014): Silicon Valley. Was aus dem mächtigsten Tal der Welt auf uns zukommt, Munich. McKinsey Global Institute (2014): Global flows in a digital age: How trade, finance, people, and data connect the world economy, Keese, Christoph (2016): Silicon Germany, Munich. April 2014.

Klenner, Christina; Lott, Yvonne (2016): Arbeitszeitoptionen im Lebensverlauf. Bedingungen und Barrieren ihrer Nutzung im Betrieb. McKinsey Global Institute (2015): Digital Globalization: The New Era of Global Flows, March 2015. Hans-Böckler-Stiftung, Düsseldorf. Milanovic, Branko (2016): Die ungleiche Welt: Migration, das Eine Prozent und die Zukunft der Mittelschicht, Berlin (English: Global Kopp, Reinhold; Sokoll, Karen (2015): Wearables am Arbeitsplatz – Einfallstore für die Alltagsüberwachung? NZA 2015, p. 1352 et seq. Inequality: A New Approach for the Age of Globalization, Cambridge, Mass.).

Krause, Rüdiger (2017): Digitalisierung und Beschäftigtendatenschutz. Expertise für das BMAS. Möller, Joachim (2016): Lohnungleichheit – Gibt es eine Trendwende? Wirtschaftsdienst, 96th volume, 13/2016, p. 38–44.

Kreikebohm, Ralf; Kuszynski, Jens (2011): Der versicherte Personenkreis in der gesetzlichen Rentenversicherung, in: Eichenhofer, Morozov, Evgeny (2013): Smarte neue Welt: Digitale Technik und die Freiheit des Menschen, Munich. Eberhard et al. (eds.): Handbuch der Gesetzlichen Rentenversicherung, Munich, Chapter 10, p. 383–410. Müller, Kai-Uwe; Neumann, Michael; Wrohlich, Katharina (2015): Familienarbeitszeit: mehr Arbeitszeit für Mütter, mehr Familien- Kucklick, Christoph (2014): Die granulare Gesellschaft. Wie das Digitale unsere Wirklichkeit auflöst, Berlin. zeit für Väter. DIW-Wochenbericht 46/2015. Familienarbeitszeit „reloaded“, p. 1095–1103.

Kurz, Constanze; Rieger, Frank (2013): Arbeitsfrei. Eine Entdeckungsreise zu den Maschinen, die uns ersetzen, Munich. New Quality of Work Initiative (Initiative Neue Qualität der Arbeit – INQA) (publisher) (2014): Monitor Führungskultur im Wandel, Berlin.

Lanier, Jaron (2014): Wem gehört die Zukunft? Du bist nicht der Kunde der Internetkonzerne. Du bist ihr Produkt, Hamburg New Quality of Work Initiative (Initiative Neue Qualität der Arbeit – INQA) (publisher) (2015): Monitor Gewünschte und erlebte (English: Who owns the future? New York). Arbeitsqualität. Die Arbeitssituation in deutschen Unternehmen aus Sicht der Beschäftigten, Berlin.

Lanier, Jaron (2015): Wenn Träume erwachsen werden. Ein Blick auf das digitale Zeitalter. Essays und Interviews 1984–2014, Hamburg. Nienhüser, Werner; Glück, Esther; Hoßfeld, Heiko (2016): Einstellungen zur Mitbestimmung der Arbeitnehmer – welchen Einfluss haben Mitbestimmungserfahrungen? WSI-Mitteilungen, 3/2016, p. 161–171. Leimeister, Jan Marco; Zogaj, Shkodran (2013): Neue Arbeitsorganisation durch Crowdsourcing. Eine Literaturstudie, in: Hans- Böckler-Stiftung, Arbeitspapier Nr. 287. Nisic, Natascha; Trübswetter, Parvati (2012): Berufswechsel in Deutschland und Großbritannien, IAB-Kurzbericht 1/2012.

Leimeister, Jan Marco; Zogaj, Shkodran; Durward, David; Blohm, Ivo (2016a): Systematisierung und Analyse von Crowdsourcing- Ohnemus, Jörg; Erdsiek, Daniel; Viete, Steffen (forthcoming): Nutzung von Crowdworking durch Unternehmen: Ergebnisse einer Anbietern und Crowd-Work-Projekten. Hans-Böckler-Stiftung Study No. 324, Düsseldorf: http://www.boeckler.de/pdf/p_study_ ZEW-Unternehmensbefragung. hbs_324.pdf. Organisation for Economic Cooperation and Development (OECD) (2015): In It Together: Why Less Inequality Beneÿts All, OECD, Paris. Leimeister, Jan; Durward, David; Zogaj, Shkodran (2016b): Crowd Worker in Deutschland – Eine empirische Studie zum Arbeits- umfeld auf externen Crowdsourcing-Plattformen. Hans-Böckler-Stiftung Study, No. 323, Düsseldorf. Organisation for Economic Cooperation and Development (OECD) (2016): Skills Matter: Further Results from the Survey of Adult Skills, OECD Publishing, Paris. Lobo, Sascha (2014): Auf dem Weg in die Dumpinghölle. Der Spiegel, 3 September 2014. Papier, Hans-Jürgen (2012): Entwicklung des Rechts auf informationelle Selbstbestimmung seit dem Volkszählungsurteil des Bun- Lott, Yvonne; Chung, Heejung (2016): Gender Discrepancies in the Outcomes of Schedule Control on Overtime Hours and Income desverfassungsgerichts. In: Datenschutz im Arbeitsverhältnis. Bitburger Gespräche in München. Volume 1, Tübingen, p. 17–31. in Germany. European Sociological Review (online), August 2016. Pfeiffer, Sabine (2015): Industrie 4.0 und die Digitalisierung der Produktion – Hype oder Megatrend? In: Aus Politik und Zeitge- Lower Saxony Institute for Economic Research (Niedersächsisches Institut für Wirtschaftsforschung – NIW) (2016): Risiken schichte. 65 (31/32), p. 6–12. verschiedener atypischer Beschäftigungsformen für die berufliche Entwicklung und das Erwerbseinkommen im Lebensverlauf. Endbericht des Forschungsvorhabens im Auftrag des Bundesministeriums für Arbeit und Soziales, Hanover. Piketty, Thomas (2013): Das Kapital im 21. Jahrhundert. 8th edition. Munich (French: Le capital au XXle siècle, Paris, 2013).

Mandel, Michael (2016): The App Economy in Europe: Leading Countries and Cities. Progressive Policy Institute. Piketty, Thomas (2015): The Economics of Inequality, Cambridge.

Manyika, James; Lund, Susan; Bughin, Jacques (2016): These Charts Show How Globalization Has Gone Digital, Huffington Post of Press and Information Office of the Federal Government (Presse- und Informationsamt der Bundesregierung) (2016): Digitalisie- 11 March 2016, http://www.huffingtonpost.com/james-manyika/charts-digital-globalization_b_9431880.html. rung: Arbeiten 4.0, Berlin.

Marburg Federation of Doctors (Marburger Bund – MB) (2015): Stellungnahme zum Grünbuch. PricewaterhouseCoopers (PwC) (2013): Big Data – Bedeutung, Nutzen, Mehrwert. Source: https://www.pwc.de/de/prozessoptimierung/ assets/pwc-big-data-bedeutung-nutzen-mehrwert.pdf. Markl, Volker; Hoeren, Thomas; Krcmar, Helmut, et al. (2013): Innovationspotenzialanalyse für die neuen Technologien für das Ver- walten und Analysieren von großen Datenmengen (Big Data Management). Studie im Auftrag des BMWi, Berlin, Münster, Munich. Rammstedt, Beatrice (ed.) (2013): Grundlegende Kompetenzen Erwachsener im internationalen Vergleich. Ergebnisse von PIAAC 2012.

Mau, Stefan; Schöneck, Nadine M. (eds.) (2015): (Un-)gerechte (Un-)gleichheiten, Berlin. Randstad Deutschland (2016): Randstad-ifo-flexindex. Ergebnisse 2. Quartal 2016. Source: www.randstad.de/polopoly_fs/ 1.653372!/download/downloadFile/Randstad-ifo-Personalleiterbefragung_2016.2Q.pdf.

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Renger, Martina (2016): Unterbeschäftigung, Überbeschäftigung und Wunscharbeitszeiten in Deutschland in: Statistisches Bundes- Stiglitz, Joseph E.; Greenwald, Bruce C. (2014): Creating a Learning Society. A New Approach to Growth, Development, and Social amt, WISTA 6/2016, p. 22–42. Progress, New York.

Riedmann, Arnold; Kümmerling, Angelika; Seifert, Hartmut (2011): Evaluation des Gesetzes zur Verbesserung der Rahmenbedingungen Sydow, Jörg; Möllering, Guido (2015): Produktion in Netzwerken, Munich. für die Absicherung flexibler Arbeitszeitregelungen („Flexi II“-Gesetz), BMAS Forschungsbericht Arbeitsmarkt 418, Berlin. Theurl, Theresia (2015): Ökonomie des Teilens: Governance konsequent zu Ende gedacht. Zeitgespräch „Ökonomie des Teilens – Rifkin, Jeremy (2014): Die Null-Grenzkosten-Gesellschaft: Das Internet der Dinge, kollaboratives Gemeingut und der Rückzug des nachhaltig und innovativ?“ Wirtschaftsdienst, 2/2015, p. 87–91. Kapitalismus, Frankfurt (English: The Zero Marginal Cost Society: The Internet of Things, the Collaborative Commons). Thiel, Peter (2014): Zero to One: Wie Innovation unsere Gesellschaft rettet, Frankfurt. Ruppenthal, Silvia; Lück, Detlev (2009): Jeder fünfte Erwerbstätige ist aus beruflichen Gründen mobil, in: ISI 42, July 2009, p. 1 5. Thüsing, Gregor (2014): Beschäftigtendatenschutz und Compliance. Effektive Compliance im Spannungsfeld von BDSG, Persönlich- Rüßmann, Michael; Lorenz, Markus; Gerbert, Philipp; Waldner, Manuela; Justus, Jan; Engel, Pascal; Harnisch, Michael (2015): Indus- keitsschutz und betrieblicher Mitbestimmung, Munich. try 4.0: The Future of Productivity and Growth in Manufacturing Industries. Boston Consulting Group, April 2015. Tobsch, Verena; Holst, Elke (forthcoming): Potenziale unfreiwilliger Teilzeit in Deutschland. Kurzexpertise im Auftrag des BMAS, Berlin. RWI – Leibniz Institute for Economic Research (Rheinisch-Westfälisches Institut für Wirtschaftsforschung – RWI) (2016): Risiken atypischer Beschäftigungsformen für die berufliche Entwicklung und Erwerbseinkommen im Lebensverlauf. Endbericht des For- Uffmann, Katharina (2016): Digitalisierung der Arbeitswelt – wie gestalten wir die notwendigen Veränderungen?, in: Neue Zeit- schungsvorhabens im Auftrag des Bundesministeriums für Arbeit und Soziales, Essen. schrift für Arbeitsrecht, 16/2016, p. 977–984.

Sattelberger, Thomas (2015): Abhängiger oder souveräner Unternehmensbürger – der Mensch in der Aera der Digitalisierung. In: United Nations (UN) (2016): The Sustainable Development Goals Report 2016, New York. Sattelberger, Thomas; Welpe, Isabell; Boes, Andreas (eds.): Das demokratische Unternehmen. Neue Arbeits- und Führungskulturen im Zeitalter digitaler Wirtschaft, Freiburg, p. 33–53. United Nations Conference on Trade and Development (UNCTAD) (2014): Transfer of Technology and Knowledge Sharing for Development, UNCTAD Current Studies on Science, Technology and Innovation No. 8, Geneva. Sattelberger, Thomas; Welpe, Isabell; Boes, Andreas (eds.) (2015): Das demokratische Unternehmen – Neue Arbeits- und Führungs- kulturen im Zeitalter digitaler Wirtschaft, Freiburg. United Services Trade Union (Vereinte Dienstleistungsgesellschaft – ver.di) (2015): Stellungnahme zum Grünbuch, p. 5.

Schirrmacher, Frank (ed.) (2015): Technologischer Totalitarismus. Eine Debatte, Berlin. Vivarelli, Marco (2014): Innovation, Employment and Skills in Advanced and Developing Countries: A Survey of Economic Literature, in: Journal of Economic Issues, 48(1), 2014, p. 123–154. Schmid, Günther (2012): Von der Arbeitslosen- zur Arbeitsversicherung. Leviathan, vol. 40, 2/2012, p. 248–270. Vogler-Ludwig, Kurt; Düll, Nicola; Kriechel, Ben (2016): Arbeitsmarkt 2030 – Wirtschaft und Arbeitsmarkt im digitalen Zeitalter. Schmidt, Florian A. (2016): Arbeitsmärkte in der Plattformökonomie – zur Funktionsweise und den Herausforderungen von Crowd- Prognose 2016. Economix Research & Consulting, Munich. work und Gigwork, Friedrich Ebert Stiftung, Bonn. Wedde, Peter (ed.) (2016): Handbuch Datenschutz und Mitbestimmung, Frankfurt. Schmillen, Achim; Stüber, Heiko (2014): Lebensverdienste nach Qualiÿkation. Bildung lohnt sich ein Leben lang, IAB-Kurzbericht 1/2014. Wehling, Margret (2000): Mitbestimmung in virtuellen Unternehmungen? In: WSI-Mitteilungen, 2/2000, p. 131–156. Schnitzlein, Daniel (2011): Umfang und Folgen der Nichtinanspruchnahme von Urlaub in Deutschland. DIW-Wochenbericht 51+52/2011, p. 14–20. Welzer, Harald (2016): Die smarte Diktatur. Der Angriff auf unsere Freiheit, Frankfurt.

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RESPONSES TO THE GREEN PAPER ON WORK 4.0

More than 50 responses to the Green Paper on Work 4.0 were submitted by associations, public institutions and private individuals. They are available online at www.arbeitenviernull.de.

» Allianz deutscher Designer (AGD) – » Bundesverband der Freien Berufe e.V. Accident Insurance » Gewerkschaft Nahrung-Genuss-Gast- » Verband Deutscher Maschinen- und Alliance of German Designers (BFB) – Federal Association of Liberal stätten (NGG) – Union of Workers in Anlagenbau e.V. (VDMA) – German Professions » Deutscher Gewerkschaftsbund (DGB) – the Food, Beverages and Tobacco In- Engineering Federation » Allianz SE – Works Council German Trade Union Confederation dustry and in the Hotel and Catering » Bundesverband der Personalmanager Trade » Vereinigung der Bayerischen » Arbeitgeberverband der Versicherungs- (BPM) – Federal Association of Human » Deutscher Industrie- und Handels- Wirtschaft e.V. (vbw) – Bavarian Indus- unternehmen in Deutschland (AGV) – Resources Managers kammertag e.V. (DIHK) – Association » Handelsverband Deutschland e.V. try Association Employers’ Association of Insurance of German Chambers of Commerce (HDE) – German Retail Federation Companies in Germany » Bundesverband E-Commerce und and Industry » ereinte Dienstleistungsgewerkschaft Versandhandel Deutschland e.V. (bevh) » Hans-Böckler-Stiftung (HBS) – Hans (ver.di) – United Services Trade Union » Arbeitgeberverband Gesamtmetall e.V. – German E-Commerce and Distance » Deutscher Landkreistag – Association Böckler Foundation – Federation of German Employers’ Selling Trade Association of German Counties » Zentralverband des Deutschen Hand- Associations in the Metal and Electri- » Hasso-Plattner-Institut für Software- werks e.V. (ZDH) – German Confedera- cal Engineering Industries » Bundesverband Informations- » Deutscher Städtetag – Association of systemtechnik GmbH (HPI) – Hasso tion of Skilled Crafts wirtschaft, Telekommunikation German Cities Plattner Institute for Software Systems Arbeitnehmerkammer Bremen – und neue Medien e.V. (Bitkom) – Engineering Zukunftsforum Familie e.V. – Forum » Die Führungskräfte e.V. (dFK) – » Bremen Chamber of Labour German Association for Information » for Progressive Family Policy German Confederation of Managers Technology, Telecommunications and » Industriegewerkschaft Bergbau, Che- Arbeits- und Sozialministerkonferenz mie, Energie (IG BCE) – Industrial Min- » New Media Die jungen Unternehmer von Die Fami- (ASMK) – Conference of the Labour » ing, Chemical and Energy Union lienunternehmer e.V. – The Young En- and Social Affairs Ministers of the Bundesverband mittelständische » trepreneurs Länder Wirtschaft, Unternehmerverband » Internet & Gesellschaft Collaboratory Deutschlands e.V. (BVMW) – German e.V. (CoLab) – Internet & Society Col- Arbeitsgemeinschaft der Personalräte Die Linke – The Left Party, response » Confederation of Small and Medium » laboratory der obersten Bundesbehörden – Associ- submitted by the Members of the Bun- Sized Enterprises ation of Staff Councils of the Supreme destag Klaus Ernst, Sabine Zimmer- Kommissariat der deutschen Bischöfe – mann, Matthias W. Birkwald, Herbert » Federal Authorities Bundesvereinigung der Deutschen German Bishops’ Office » Behrens, Jutta Krellmann, Susanna Arbeitgeberverbände (BDA) – Bundesagentur für Arbeit (BA) – Karawanskij, Harald Weinberg, Azize Marburger Bund, Verband der ange- » Confederation of German Employers’ » Federal Employment Agency Tank* stellten und beamteten Ärztinnen und Associations Ärzte Deutschlands e.V. – Marburg Bundesarbeitgeberverband Chemie e.V. Eisenbahn- und Verkehrsgewerkschaft » Daimler AG » Federation of Doctors (BAVC) – Federation of Chemical Em- » (EVG) – Rail and Transport Union ployers’ Associations DB Dienstleistungen GmbH – Katja Mast, Member of the Bundestag, » Evangelische Kirche in Deutschland » Divisional Works Council (DB) » SPD parliamentary group in the Bun- » Bundesärztekammer – German Medical (EKD) – Evangelical Church in Germany destag* Association dbb Beamtenbund und Tarifunion » Gesellschaft für Versicherungswissen- (dbb) – German Civil Service » Robert Bosch GmbH Bundesverband der Arbeitsrechtler in schaft und -gestaltung e.V. (GVG) – » » Federation Unternehmen e.V. (BVAU) – Federal German Association for Social Security » Professor Christopher M. Schlick, Insti- Association of Labour Law Experts in » Deutsche Gesellschaft für Arbeits- Research and Policy tut für Arbeitswissenschaft der RWTH Businesses medizin und Umweltmedizin e.V. Aachen (IAW) – Institute of Industrial Gewerkschaft der Sozialversicherung – (DGAUM) – German Society for Occu- » Engineering and Ergonomics at RWTH Bundesverband der Deutschen Indus- Frauenvertretung (GdS) – Social Insur- » pational and Environmental Medicine Aachen University trie e.V. (BDI) – Federation of German ance System Trade Union – Women’s * The responses submitted by political parties Industries Representation Sozialverband Deutschland e.V. (SoVD) Deutsche Gesetzliche Unfallver- » and parliamentary groups in the Bundestag » – Social Organisation Germany sicherung (DGUV) – German Statutory have not been quoted in the text.

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THE CONSULTATION PROCESS DIALOGUE PARTNERS AND FORMATS The process was an open one, and many individuals and organisations participated. The dialogue was energised by over 50 responses to the Green Paper which were submitted to the Federal Ministry of La- The public debate on Industry 4.0 is characterised by the fact that bour and Social Affairs by the trade unions, employers associations, the focus is on technological innovations, with little attention paid to companies and other stakeholders. The positions and proposals they labour and the impacts of technological development on the world of contained were discussed with the submitting organisations and other work. partners at a mid-term conference on 15 March 2016. A list of all responses is included in this White Paper (ÀÁpage 214). For this reason, the Federal Ministry of Labour and Social Affairs created a framework for dialogue with the public and experts on the fu- A total of seven workshops were held with more than 200 experts ture of our working society: the Work 4.0 dialogue, which ran from from academia, the practitioner community and the social partners to the spring of 2015 to the end of 2016. Work 4.0 encapsulated this dia- identify areas where action is needed in relation to key issues and to logue. Rather than looking only at work in the new production systems evaluate options for action. Close collaborative links were developed of Industry 4.0, the dialogue aimed to discuss and play a part in shap- with the permanent members of the expert group, who took part in all ing our future working society’s social conditions and rules, building of the workshops and provided valuable input. A list of the experts and on a vision for quality jobs and decent work in the digital age. the subjects examined is included in this White Paper (ÀÁpage 224).

FROM THE GREEN PAPER TO THE WHITE PAPER As part of the Work 4.0 dialogue, a separate consultation process At the launch event in April 2015, Minister Nahles presented a Green on working time was held with the social partners, companies, civil so- Paper on Work 4.0 which outlined the starting point and the Minis- ciety and academia. The aim of the working time dialogue was to dis- try’s aims, identified important developments, and posed many con- cuss, in a confidential framework, the challenges and opportunities of crete questions to be discussed in the consultation process. The Green innovative approaches to the organisation of working time, and to ex- Paper subsequently flew off the press and has since reached a print run plore the potential for a fundamental consensus and compromises bet- over of 27,000 copies. It has also been downloaded from the Ministry’s ween the participating stakeholders. website 11,000 times. It has been translated into English and even Ja- panese so that it can form the basis for a dialogue which is not con- Separate discussions were held with representatives of self-em- fined to Germany alone. ployed individuals, business founders and small business owners on their specific needs and matters of special importance to them. To give the dialogue a clear objective, the Federal Ministry of Labour and Social Affairs decided early on to present the initial outcomes in a The discussions also closely incorporated the existing discussion for- White Paper. It reflects what was discussed in working groups, expert mats of the Federal Ministry of Labour and Social Affairs on the future workshops, strategy and outcome papers, conferences, visits to compa- of work and securing the supply of skilled labour, such as the Partner- nies and bilateral dialogues, and it sets out what conclusions the Minis- ship for Skilled Professionals, the IT Summit’s “Digital Working World” try has drawn. A draft of the White Paper was presented at the closing platform and the Steering Committee of the New Quality of Work Ini- conference on 29 November 2016. tiative (INQA) . The New Quality of Work Initiative has significantly revised its mission statement on the basis of the dialogue and is already incorporating impetus from Work 4.0 . The IT Summit’s “Digital Working World” platform, headed jointly by the Metalworkers’ Union

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(IG Metall) and the Federal Ministry of Labour and Social Affairs, looked Two documents to be singled out in this context are the Labour Mar- in detail at the issues of “flexibility in working time and location” and ket Forecast for 2030 and the unprecedented study “Value Systems in “employment and continuing vocational education and training” and the Context of Work 4.0 ” (Wertewelten Arbeiten 4.0), which is based has published its own final reports on these subjects. on in-depth qualitative interviews with a representative sample of 1,200 people. Both of these documents highlight the immense oppor- The website www.arbeitenviernull.de offers an overview of the tunities associated with digitalisation. At the same time, they show how consultation process. It is a platform for all members of the public who much variation there is in workers’ needs and their visions of ideal want to have their say. Comments on events, the Green Paper and work, and how different and in some respects contradictory their ex- this White Paper can be submitted via Facebook and Twitter. From 5 pectations are regarding their own work and political action. November 2015, the Futurale film festival offered a forum for discussions on the future of work, with 175 film screenings across Germany. Seven documentaries on various aspects of the modern working world were screened at 25 locations. After each screening, regional experts and the audience engaged in discussion. Over 8,000 audience members were involved in the Work 4.0 dialogue via the Futurale film festival.

The responses to the Green Paper were published on the website both individually and by subject, and extracts were published in the “Work 4.0 workbooks” (Werkhefte). These workbooks accompanied the consultation process, offered an insight into the state of discussion on the key issues, contributed to the debate and formed an extended platform for the specialised dialogue on the future of work. The first issue of the Work 4.0 workbooks on the digitalisation of the working world was presented at the mid-term conference. The second issue came out in early September 2016. 10,000 copies of the workbooks were published. They are also available online for download.

ACCOMPANYING RESEARCH Throughout the entire Work 4.0 dialogue, the Federal Ministry of Labour and Social Affairs has not only sought close contact with the research community, but also commissioned more than twenty research projects and individual papers in order to sharpen our awareness of the empirical starting point, areas where action is needed and the policy options. These research projects ranged from surveys of current research results on individual issues and analysis of the political debates on digitalisation in other countries, to representative business and worker surveys, special Microcensus analyses and legal opinions, to collected examples of best practice in relation to flexibility in working time and location and continuing vocational education and training. Results from these studies are presented at many points in this White Paper.

218 219 THE CONSULTATION 11,000 OVER GREEN PAPER 200 DOWNLOADS 27,000 EXPERTS FROM ACADEMIA, TRADE UNIONS, ASSOCIATIONS AND THE PROCESS PRINTED PRACTITIONER COMMUNITY GREEN PAPERS PARTICIPATED IN 7 WORKSHOPS LAUNCH CONFERENCE RE- IMAGINING WORK RESPONSES FROM AROUND 12,000 CLOSING OVER 50 ASSOCIATIONS, INSTITUTIONS, PARTICIPANTS IN EVENTS HELD BY COMPANIES THE FEDERAL MINISTRY OF LABOUR 22 APRIL 2015 AND SOCIAL AFFAIRS AS PART OF CONFERENCE THE CONSULTATION PROCESS 29 NOVEMBER 2016

PUBLIC DIALOGUE • The website www.arbeitenviernull.de documents the process • Town hall meeting with Federal Minister Nahles and offers opportunities for direct participation at re:publica 2016 • 4,300 contributions on Work 4.0 via arbeitenviernull, Twitter and Facebook • 4 panels as part of the Xing New Work Session • Futurale ÿlm festival: 7 documentaries • 15,000 completed online tests for the “Value • 175 discussion events in 25 towns and cities Systems in the Context of Work 4.0” study GREEN PAPER WHITE PAPER WORK 4.0 SPECIALISED DIALOGUE • Symposium on Service Platforms from a Worker and WORK 4.0 • Advisory group composed of 18 experts from the academic and Consumer Perspective, held in partnership with the Federal practitioner communities Ministry of Justice and Consumer Protection • Series of 7 workshops • Conference on Work in the Digital World – People, • Working time dialogue with the Humboldt-Viadrina Governance Platform Organisation, Technology, held in partnership with the • Work 4.0 lab: dialogue with solo self-employed individuals Federal Ministry for Economic Affairs and Energy • Accompanying workbook offers an insight into the state of the discussions • IT Summit “Digital Working World” platform, Partnership for (2 editions, 10,000 copies printed of each edition) Skilled Professionals, New Quality of Work Initiative (INQA)

The “Digital Working World” foresight study provides STUDIES AND PAPERS • a medium- to long-term perspective on potential “Value Systems in the Context of Work 4.0” study: • developments in the world of work in individual sectors based on in-depth interviews with a representative More than 20 academic papers and legal opinions on issues sample of 1,200 people • such as co-determination, continuing vocational education “Labour Market Forecast for 2030” on the development • and training, crowdworking, solo self-employment, flexibility of skilled labour supply and demand in Germany in working hours and location, etc. OVER 15,000 COMPLETED ONLINE MID-TERM TESTS FOR THE “VALUE SYSTEMS IN THE CONTEXT OVER 8,000 OVER CONFERENCE 1,000,000 OF WORK 4.0” STUDY VISITORS TO THE MOVING TOWARDS THE WHITE PAPER, PAGE VIEWS ON THE ARBEITEN- 220 FUTURALE FILM FESTIVAL 221 15 MARCH 2016 VIERNULL WEBSITE Annex

ADVISORY GROUP

The specialised dialogue was supported by a group of advisers. The experts were drawn from both the academic and practitioner communities.

Professor Irene Bertschek Professor Kerstin Jürgens Dr Ulrich Walwei Head of the Information and Head of Microsociology, Deputy Director of the Institute for Communication Technologies Research University of Kassel Employment Research (IAB) Department, Centre for European Economic Research (ZEW), Mannheim Professor Ute Klammer Professor Armin Windel Executive Director of the Institute for Director of Research and Development, Professor Gerhard Bosch Work, Skills and Training (IAQ), Federal Institute for Occupational Safety Institute for Work, Skills and Training (IAQ), University of Duisburg-Essen and Health (BAuA) University of Duisburg-Essen Dr Hans-Peter Klös Professor Ralph Bruder Member of the Management Board, Head of the Institute for Ergonomics (IAD), Cologne Institute for Economic Technische Universität Darmstadt Research (IW)

Dr Elke Frank Dr Nathalie Lotzmann Head of Group Performance Development, Head of Global Health Management, Deutsche Telekom AG SAP SE

Astrid Granzow Professor Joachim Möller Chairwoman of the Central Works Council, Director of the Institute for Employment Atos Information Technology GmbH Research (IAB)

Professor Armin Grunwald Thomas Sattelberger Head of the Institute for Technology Spokesman of the Issue Ambassadors for Assessment and Systems Analysis (ITAS), the New Quality of Work Initiative (INQA) Karlsruhe Institute of Technology Mathias Staiger Michael Guggemos Deputy Chairman of the Works Council, Management Spokesman, Trumpf Werkzeugmaschinen GmbH + Hans Böckler Foundation Co. KG

PD Dr Elke Holst Professor Bernd Waas Gender Studies Research Director, German Institute of Civil and Business Law, Institute for Economic Research (DIW) Goethe University Frankfurt

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EXPERT DIALOGUE WORKSHOPS

The consultation process on the work of the future was also conducted in the WORK OR INDIVIDUAL SCHEDULES AND PRIORITIES – WHO IS IN CONTROL? framework of a specialised dialogue, with a series of workshops involving OPTIONS FOR A LIFE-PHASE APPROACH TO THE ORGANISATION OF WORKING TIME experts from the academic and practitioner communities. Documentation on Dr Ulrich Walwei Professor Ulrich Mückenberger Dr Philip Wotschack all of the workshops can be accessed at www.arbeitenviernull.de. Institute for Employment Research (IAB): Research Professor of Transnational Berlin Social Science Center (WZB): Working time realities and wishes Labour Law at the University of Bremen, Optional long-term accounts: Chairman of the German Society for Time potential, limits and policy options Dr Hartmut Seifert Policy (DGfZP): Social-policy implications WSI Senior Research Fellow, Hans Böckler of working time policy Professor Heide Pfarr Foundation: Employees’ working time Chairwoman of the Commission on Labour, needs Dr Christina Klenner Corporate and Commercial Law and Equal Institute of Economic and Social Research Opportunities of the German Women Dr Hans-Peter Klös (WSI) at the Hans Böckler Foundation: Lawyers Association (djb): Policy options Cologne Institute for Economic Research Working time options over the life course for working time choice (abridged written (IW): Companies’ working time needs – What factors in organisations influence version of the presentation) their use? PD Dr Elke Holst Professor Gerhard Bosch German Institute for Economic Research Daniela Jauch University of Duisburg-Essen: Parameters (DIW): Working time realities and wishes Gambro Dialysatoren GmbH: Best practice – of a life-phase approach to the organisation from a gender perspective Working time options in organisations of working time

MOBILE AND ANYTIME, ANYPLACE WORKING

Dr Susanne Steffes Frank Roth Professor Friedhelm Nachreiner Centre for European Economic Research AppSphere: Opening up options and Formerly of the University of Oldenburg: (ZEW): Mobile and anytime, anyplace setting guidelines, from the perspective Questions relating to the law on working working from the perspective of em- of a small business time: what legal framework promotes ployees: results of the “Quality of work healthy working when workers control and economic success” survey Dr Peter Cammerer their working time and location? BMW Works Council: Opening up Professor Antje Ducki options and setting guidelines, from Professor Rüdiger Krause Beuth University of Applied Sciences, the perspective of a large company University of Göttingen: Questions Berlin: Mobile work – health risks and relating to the law on working time: opportunities – needs for action Dr Manuela Maschke setting boundaries Hans Böckler Foundation: Key fields of Professor Ulrike Hellert action in shaping mobile work by means FOM University of Applied Sciences: of works agreements Mobile and anytime, anyplace working from the perspective of SMEs Paul van Dun Ministry of Social Affairs and Employment, Dr Elke Frank the Netherlands: When possibilities Microsoft: Digital technologies as become rights: the right to telework in facilitators of new forms of flexibility the Netherlands

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DIGITALISATION’S IMPACTS ON EMPLOYMENT AND FORMS OF WORK LABOUR LAW AND CO-DETERMINATION

Professor Michael Beigl Oskar Heer Sebastian Kurt Professor Gregor Thüsing Uwe Zillessen Dr Manuela Maschke Karlsruhe Institute of Technology (KIT): Daimler AG: Working in Industry 4.0 – scondoo GmbH: Advantages and University of Bonn: Forms of digital work Works Council of Publicis Pixelpark: Hans Böckler Foundation: Position on What lies ahead? An overview of techno- challenges for organisations and workers disadvantages of new forms of work and their classification under labour law Innovative participation approaches – joint approaches to change processes in logical developments and their fields of for user companies case study: Publicis Pixelpark, Cologne organisations in the digital working world application Thomas Mendrzik Dietmar Schenn Hamburger Hafen und Logistik AG: Social Works Council of Audi AG: Professor Peter Wedde Dr Hans-Peter Klös Professor Holger Bonin partnership in an era of rising automation Innovative participation approaches – Frankfurt University of Applied Sciences: Cologne Institute for Economic Research Centre for European Economic Research – example of an innovative collective case study: Audi AG Digitalisation and employee data protec- (IW): Position on joint approaches to (ZEW): Debate about the end of work and agreement offering protection from tion, and impetus for joint approaches to change processes in organisations in the digitalisation’s impacts on employment, rationalisation change processes in organisations in the digital working world occupations and skills digital working world Professor Jan Marco Leimeister Professor Volker Deville University of Kassel: New forms of work in Allianz Deutschland AG: What does rising the digital working world – fields of action automation mean for employees of an in- and policy options surance group? New skills requirements and operational approaches

EDUCATION, SKILLS DEVELOPMENT AND CONTINUING VOCATIONAL EDUCATION AND TRAINING SOCIAL SECURITY

Professor Reinhard Pollak Alfred Löckle Robert Titelbach Dr Verena Tobsch Dr Andreas Lutz Dr Reinhold Thiede Berlin Social Science Center (WZB) and Central Works Council and Group-Level Federal Ministry of Labour, Social Affairs Institute for Empirical Social and Association of Founders and Entrepre- German Federal Pension Insurance Freie Universität Berlin: Challenges for Works Council of Robert Bosch GmbH: and Consumer Protection, Austria: Policy Economic Research (INES), Berlin: neurs Germany (VGSD): Position of an (DRV Bund): Problems in designing continuing vocational education and train- Continuous vocational training as an learning, taking full-time and part-time Solo self-employed individuals in Germany organisation representing the interests pension insurance for (solo) self- ing in Germany (need, supply structure, instrument for in-company training of training leave in Austria as an example and the potential of the gig economy of self-employed individuals employed individuals uptake, potential for social mobility) skilled workers and social mobility Friedhelm Siepe Professor Wiebke Brose Michael Quabach Monika Queisser Jan Eggert Stefan Soltmann Federal Employment Agency: How does University of Duisburg-Essen: German Statutory Accident Insurance OECD: Design of provision for old age BMW Education Academy: Industrial Mining, Chemical and Energy the Agency see its future/development Assessment of new forms of employment (DGUV): Digitalisation’s impacts on for self-employed individuals in selected Industry’s changed needs regarding Union (IG BCE): Anchoring of continuing potential? (Strategic focus and concrete in terms of existing social insurance law statutory accident insurance: status OECD countries – policy learning human resources and skills vocational education and training in experience gained from the pilot project quo and challenges collective bargaining policy on advice on continuing vocational Melanie Fahmy Victoria Ringleb Professor Matthias Jarke education and training) TNS Infratest: Presentation of the Professor Ulrich Preis Alliance of German Designers (AGD): Fraunhofer Institute for Applied Informa- Professor Eva Kocher / Professor Felix results of the qualitative study University of Cologne: Necessity of Position of an organisation representing tion Technology (FIT): New requirements Welti “Focus group discussions” compulsory provision for old age for the interests of self-employed individuals of the digital working world – computer- European University Viadrina, Frankfurt all members of the labour force? based possibilities for continuing voca- (Oder) / University of Kassel: tional education and training integrated in Legal design of an entitlement to continu- the working process. ing vocational education and training

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SOCIALLY COMPATIBLE CHANGE MANAGEMENT AND GOOD CORPORATE MANAGEMENT

Jan Sievers Per Wiek Dr Jochen Appt TUI AG: Evolution of agile methods Deutsche Bahn AG: The future of German Statutory Accident Insurance in practice in a large company human-machine interaction in the (DGUV): New challenges for health and service sector safety at work and possibilities for the Professor Rötting organisation of work Technische Universität Berlin: Future Dr Immanuel Hermreck of human-machine interaction Bertelsmann SE: Shaping the digital Dr Werner Eichhorst transformation from the perspective of Institute of Labor Economics (IZA): Dr Christian Schlögel human resources management Economic incentive systems to promote KUKA AG: Human-machine interaction good working conditions in Industry 4.0 Birgit Isenmann und Alfred Löckle Robert Bosch GmbH: Shaping the digital transformation at Robert Bosch GmbH

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FUTURALE – A FILM FESTIVAL THE FILMS

ON THE FUTURE OF WORK UNLIMITED FREEDOM – UNLIMITED REACHABILITY? DIGITALE NOMADEN – DEUTSCHLAND ZIEHT AUS

Director: Tim Jonischkat, Germany 2015 Digital nomads are location-independent, free-spirited individuals who are able to carry out their work anywhere in the world. On 5 November 2015, the Federal Ministry of Labour and Social The first German-language documentary on this subject takes the audience on a fascinating voyage of discovery through a new Affairs launched another way for members of the public to participate way of life and a new working world. The film festival #Futurale in the discussion about the future of work: Futurale. » ROBOTS AS THE ANSWER TO DEMOGRAPHIC CHANGE? is about nothing less than the IK BEN ALICE #FutureofWork « The film festival, consisting of seven documentaries, toured Germany Director: Sander Burger, The Netherlands 2015 25 Feb. 2016 via Twitter for an entire year. The films cover a wide range of different aspects of In an ageing society, qualified professionals are in short supply in the long-term care sector, and so in future the robot carer “Alice” will step in. The documentary IK BEN ALICE, which premiered in Rotterdam, examines the question of how robots can work: they show the everyday reality of work in all its facets, highlight build a relationship with people. Moving, heart-rending and ethically thoughtful. digitalisation’s impacts on traditional occupations, and follow compa- »Go along! Take part in nies which are embarking on new paths. They show new forms of WILL THE FUTURE BE PRINTED? PRINT THE LEGEND the discussion! Learn something! employment and innovative life plans, and offer an insight into the #FUTURALE world of start-ups. Directors: Luis Lopez, Clay Tweel, USA 2014 « The prize-winning documentary PRINT THE LEGEND looks at the race to bring 3D printing technology to market, which 14 Sep. 2016 via Twitter Barack Obama referred to as the next technical revolution in his 2013 State of the Union Address. The filmmakers follow the Following each film, regional experts engaged in discussion with the entrepreneurs who are placing 3D technology at the heart of their start-up ideas, and show what this “Macintosh Moment” means to them. audience – and so the subject of Work 4.0 was examined from a whole »Today: Work 4.0 – hopes range of different perspectives over the course of 175 events. More I WORK, THEREFORE I AM – IDENTITY VIA WORK? and reality « information is available at www.arbeitenviernull.de. DEINE ARBEIT, DEIN LEBEN! 16 Apr. 2016 via Twitter Director: Luzia Schmid, Germany 2015 DEINE ARBEIT, DEIN LEBEN! is part of a cross-media project examining what work means today in a traditional industrial heartland. And it does so as authentically and directly as possible: from the perspective of the people concerned. At the invitation of the broadcaster WDR, people recorded their day-to-day work using smartphones or video cameras. This documentary was then created from several hundred homemade videos.

BRAVE NEW WORKING WORLD? MORE THAN 8,000 HAPPINESS AT WORK 7 FILMS AUDIENCE MEMBERS Director: Martin Meissonnier, France 2014 The economic crisis has the global labour market in its grip. The documentary HAPPINESS AT WORK gives a voice to Hamburg companies which are defying the negative mood and taking innovative steps to ensure that their staff enjoy coming to Bremen Potsdam work again, while at the same time generating higher profits. Berlin Hannover Düsseldorf 25 LOCATIONS DREAMING OF COINING IT IN FROM YOUR SOFA? YOUTUBE MAKES IT POSSIBLE Braunschweig Magdeburg PLEASE SUBSCRIBE Koblenz Jena Director: Dan Dobi, USA 2013 Kiel/Ostholstein Dortmund Kassel Dresden Gütersloh YouTube is already the world’s second biggest search engine, after Google. Every day, users click on around four billion videos; hundreds of hours of video material are uploaded every minute. PLEASE SUBSCRIBE explains the phenomenon of some of the most influential content creators who have set the standard for YouTubers. 102,388 MINS OF FILM SCREENINGS Rostock Tübingen Frankfurt Nürnberg Bayreuth FROM IDEA TO START-UP – HOW LONG A ROAD? am Main Saarbrücken SILICON WADI Karlsruhe München Director: Daniel Sivan, Yossi Bloch, Israel 2014 Bodensee Mainz Israel is regarded as the start-up nation. There are more start-ups in Tel Aviv alone than in the whole of Europe. Nowhere else can match Israel for the amount of venture capital available per person. How does a high-tech nation function? OVER 350 EXPERTS SILICON WADI by Daniel Sivan and Yossi Bloch follows four young companies and their backers in Tel Aviv over two years.

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