How Does Market Making Affect Industrial Relations? Evidence from Eight German Hospitals
| Author | Thorsten Schulten,Nils Böhlke,Ian Greer |
| Date | 01 June 2013 |
| Published date | 01 June 2013 |
| DOI | http://doi.org/10.1111/j.1467-8543.2011.00885.x |
How Does Market Making Affect
Industrial Relations? Evidence from
Eight German Hospitalsbjir_885215..239
Ian Greer, Thorsten Schulten and Nils Böhlke
Abstract
The introduction of market mechanisms matters for industrial relations. In the
German hospital sector, national liberalization policies have put immense pres-
sure on local management and worker representatives and led to the growth of
a low-wage sector. In case studies of eight hospitals, we find some locales where
market making has led to union revitalization and mobilization, but this effect
varies. Using an eight-way comparison, we infer a configuration of three aspects
of the local political economy — labour markets, politics and co-determination
rules — that together provide a well-fitting explanation for both variation and
change.
1. Introduction
In the 1980s and 1990s, industrial relations writers asked why German
labour-management partnership was resilient in the face of changing world
markets. The answer was that institutions mattered: country-specific rules
regulating in-firm worker participation (co-determination) and wages (coor-
dinated collective bargaining) produced mutual gains for workers and
employers on a mass scale (Turner 1991). In recent years, however, Germany
has gone from being one of the most equal societies in Europe to having an
incidence of low-wage work close to that of the UK (Bosch and Weinkopf
2008). Much of this low-wage work is nominally organized, with 34 per cent
of workers in the lowest income quintile covered by collective agreements in
2008 (Bispinck et al. 2010). If, as theorists argue, formal institutional change
has been gradual and has served to shore up the system’s basic logic (Streeck
and Thelen 2005), why have these outcomes changed?
In this article, we explore these shifts in the German hospital sector. More
than other countries, Germany has increased the scope for hiving off groups
Ian Greer is at the University of Greenwich. Thorsten Schulten is at the Hans-Böckler-Stiftung.
Nils Böhlke is at Landtagsfraktion Nordrhein-Westfalen.
bs_bs_banner
British Journal of Industrial Relations doi: 10.1111/j.1467-8543.2011.00885.x
51:2 June 2013 0007–1080 pp. 215–239
© John Wiley & Sons Ltd/London School of Economics 2011. Published by John Wiley & Sons Ltd,
9600 Garsington Road, Oxford OX4 2DQ, UK and 350 Main Street, Malden, MA 02148, USA.
of hospital staff into low-wage collective agreements for support services
(Grimshaw et al. 2007), to defect from collective bargaining altogether
(Böhlke and Schulten 2009), or shift from one set of co-determination rules
to another. This institutional disorganization has taken place against the
backdrop of an overall squeeze on resources in the public sector and a shift
towards private ownership in hospitals, both resulting from the introduction
of market mechanisms into health-care funding formulae. Unions and civil
society have responded by mobilizing against privatization and the derecog-
nition of sectoral bargaining (Greer 2008) and by organizing within the
private-sector co-determination framework, which is formally stronger than
its public-sector counterpart.
We argue that, to understand the changes of the past decade in Germany,
theory needs to depart from the standard toolkit of comparative institution-
alism and turn to issues of market making and local political economy. In
response to the relentless liberalization of the sector, we observe a wide
variation in the functioning of worker representation.1Using an eight-way
comparison, we find that variation is due to differences in local politics and
labour markets, as well as sector-specific co-determination rules.
Our research into the sector draws on publicly available data on the sector
and in-depth interview-based qualitative research on eight hospitals, carried
out between 2003 and 2009. Our research began in 2003 as an exploration of
a campaign in Hamburg by Germany’s main union in healthcare, vereinte
Dienstleistungsgewerkschaft (ver.di) against a large-scale privatization initia-
tive. We also conducted interviews at the national level and at two other
municipal hospitals, Chemnitz (in the east) and Stuttgart (in the south), to
assess the representativeness of the Hamburg case. In 2006–2008, we added
to our sample municipal hospitals operating under centre-left local govern-
ments in Dortmund and Berlin and the largest acquisitions of the two other
large for-profit players: Helios (Erfurt’s municipal hospital) and Rhön (the
Gießen-Marburg University Hospital). At each site, we interviewed works
councillors and staff of the main union, ver.di, and at most sites, we
also interviewed managers, politicians and union allies. We triangulated this
information using the trade press, collective agreements, consultants’ reports,
union newsletters, newspapers, publicly available statistical data and inter-
views with national officials of ver.di and the physicians union, the Mar-
burger Bund. We conducted 60 interviews with 57 individuals, with more
interviews at the hospitals we had been studying the longest, including six
national-level experts. In January 2009, we held a two-day conference in
which worker representatives discussed their work and debated our findings.
Participants included representatives from ver.di’s national and regional
offices and works councillors from Hamburg (Asklepios), Stuttgart (public),
Gießen-Marburg (Rhön) and Berlin-Buch (Rhön) (see Table 1).
This article begins by reviewing recent developments in institutional theory
and German industrial relations. Second, we provide an overview of changes
in the terms of competition in the hospital sector and their effects in the
workplace and on collective bargaining. Third, we examine workplace
216 British Journal of Industrial Relations
© John Wiley & Sons Ltd/London School of Economics 2011.
To continue reading
Request your trial