US multi-nationals and the German industrial relations system

This paper critically reviews literature on the behaviour of US-based Multi National Companies (MNCs) in Germany in relation to the historic institutions of the German labour market works councils and industry wide collective bargaining. The German system is becoming increasingly company father than sectorally centred, and US based companies have reinforced a wing of German employer opinion seeking to further these developments. Surveys show US based companies generally accepting works councils and sectoral bargains but case study evidence also shows them seeking to weaken links with parts of the system external to the company. A typology is pro- posed and it is argued that many US based companies appear to follow a ‘formal compliance/content avoidance dichotomy’ tending to exacerbate the system's existing tendencies towards disarticulation. They also tend to explore all options available to them within the existing system. A research agenda is suggested.