JUTTA HELM

The German labor movement has a long history of relying on the state for
protection against employers and market forces. Although the costs and benefits of
this "state fixation" are continually being debated, there can be little doubt that
over time it has assured organized labor a recognized position within offices and
factories, in collective bargaining, and in the institutions of macroeconomic
policymaking. This was not a smooth development, by any means. Economic and
political changes have at times boosted and at other times suppressed labor's
aspirations. ¹ As far back as 1891 the Works Protection Act encouraged the
establishment of workers' committees in factories--albeit on a voluntary basis. In
1916 the committees became obligatory. Historians now view these first steps as
an admission by the state that the governance of firms cannot entirely be left to
employers. This view was explicitly incorporated into the constitution of the
Weimar Republic and was spelled out more concretely in the Works Council Act
of 1920, a major step forward for worker and trade union rights. But these rights
crumbled during the Great Depression when employers were less and less willing
to cooperate with the law. This process reached its logical conclusion in the
Fascist state. Trade unions were outlawed in 1933, and a year later the Works
Council Act was formally replaced by new rules that imposed the Führer-principle
on all economic organizations.

The collapse of the political and economic order in 1945 created the kind
of vacuum in which works councils and trade unions were able to reestablish
themselves. Their efforts often salvaged what was left of infrastructures and supply
systems. Some industrialists were quick to recognize their legitimacy and sought
their cooperation in efforts to win more lenient treatment from the allied occupying
powers. Labor leaders hoped to extend this cooperation to full codetermination in
the context of the socialization of all basic industries. But this goal was not
achieved. Instead "parity codetermination" at the enterprise level emerged as the
result of an employer initiative in the steel industry in 1947. ²

In 1951 this practice was codified in the Codetermination Act for the
mining and iron/steel industries which gives employees the same number of seats
on corporate supervisory boards as those allocated to representatives of private
capital. Ever since then organized labor has attempted to extend this model law to

-173-