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Works Councils, Collective Bargaining, and Apprenticeship Training – Evidence From German Firms
Author(s) -
Kriechel Ben,
Muehlemann Samuel,
Pfeifer Harald,
Schütte Miriam
Publication year - 2014
Publication title -
industrial relations: a journal of economy and society
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.61
H-Index - 57
eISSN - 1468-232X
pISSN - 0019-8676
DOI - 10.1111/irel.12061
Subject(s) - apprenticeship , training (meteorology) , german , collective bargaining , investment (military) , business , institution , labour economics , economics , political science , law , philosophy , linguistics , physics , archaeology , politics , meteorology , history
In this paper, we investigate the effects of works councils on apprenticeship training in Germany. The German law attributes works councils substantial information and co‐determination rights to training‐related issues. Thus, works councils may also have an impact on the cost‐benefit relation of workplace training. Using detailed firm‐level data containing information on the costs and benefits of apprenticeship training, we find that firms with works councils make a significantly higher net investment in training compared to firms without such an institution. We also find that the fraction of former trainees still employed with the same firm 5 years after training is significantly higher in the presence of works councils, thus enabling firms to recoup training investments over a longer time horizon. Furthermore, all works council effects are much more pronounced for firms covered by collective bargaining agreements.