14.07.2017 | KPMG Law Insights

Collective Bargaining Unity Act – constitutional with restrictions

Collective Bargaining Unity Act – constitutional with restrictions

Pending status prolonged – improvements required – goal of legal certainty achieved only with limitations

The Federal Constitutional Court has declared the Collective Bargaining Unity Act to be fundamentally constitutional (ruling of July 11, 2017, Ref.: 1 BvR 1571/15). However, the issue of collective bargaining agreements remains in limbo for the time being, as the law needs to be amended in parts by the legislator. From the point of view of the smaller unions, which reject the law as a restriction of their constitutionally guaranteed freedom of association, this appears to be a setback; for the large unions and employers, it is a step forward. But much remains uncertain: the judges have passed the ball back to the labor courts.

The law was triggered by a 2010 ruling of the German Federal Labor Court (ruling of July 7, 2010, Ref.: 4 AZR 549/08), which abandoned the principle of collective bargaining unity (“one company – one collective agreement”). Politicians, employers and parts of the public feared power struggles, high wage demands and long strikes, especially on the part of smaller sectoral unions. Examples, particularly from the healthcare and transport sectors (Lufthansa, Deutsche Bahn), show that the fears were not entirely unrealistic.

In 2015, the legislature reacted with the Collective Bargaining Unity Act, which was intended to restore the old situation. In the event of conflicting collective agreements, only one collective agreement should apply in each company, namely the agreement of the trade union with the most members (Section 4a (2) Sentence 2 of the Collective Agreement Act). For smaller sectoral unions, such as those representing train drivers, doctors or pilots, this means an encroachment on their freedom to represent their members and negotiate collective agreements on their behalf. This creates a two-tier society among unions, where some can negotiate valid collective agreements but others cannot. It is obvious which union is more attractive to its members. Accordingly, the smaller unions felt that their freedom of association under Article 9 (3) of the Basic Law had been violated.

For the labor courts, the work is only just beginning

The ruling is a stage victory for the Federal Ministry of Labor and Social Affairs and the DGB trade unions. Overall, the principle of “one company – one collective agreement” has not been touched by the Federal Constitutional Court. This result had already been foreshadowed in the proceedings of the First Senate of the Federal Constitutional Court in January of this year. In the run-up to the proceedings, however, renowned legal experts had considered the legal fixation of the principle of collective bargaining unity to be unconstitutional. Many employers were therefore skeptical and did not apply the law. Lufthansa, for example, only ended its conflict with the Vereinigung Cockpit pilots’ union in March by reaching a collective agreement.

Are strikes by divisional unions now a thing of the past? In principle, according to the ruling of the Federal Constitutional Court, the collective agreement of the larger union supersedes the agreement of the smaller one – so strikes by unions with few members are unlikely for the time being.

Doh the judges have left a loophole open: The interests of the smaller union and its members must be sufficiently taken into account in the applicable collective bargaining agreement, namely “seriously” and “effectively.” However, the judges refrained from further specification. This is what the labor courts will have to deal with in the coming years. Until a robust body of case law is established, the judgment therefore creates legal certainty to a very limited extent at best.

Link to the ruling of the Federal Constitutional Court


Explore #more

17.05.2024 | KPMG Law Insights

Podcast series “KPMG Law on air”: When the family business is to be sold

Around 38,000 family businesses are currently handed over each year. In most cases, the change of ownership takes place within the family. But more and…

03.05.2024 | KPMG Law Insights

Doubts about inability to work? What employers can do

The certificate of incapacity for work (AU certificate) serves as proof of incapacity for work due to illness. However, only if the certificate meets certain…

29.04.2024 | KPMG Law Insights

Agreement on ecodesign regulation: products to become more sustainable

After lengthy negotiations, the Council and Parliament of the European Union reached a provisional agreement on the Ecodesign Regulation on the night of December 5,…

27.03.2024 | KPMG Law Insights

EU Buildings Directive: life cycle greenhouse potential becomes relevant

On March 12, 2024, the EU Parliament approved the amendment to the EU Buildings Directive. The directive obliges member states and, indirectly, building owners and…

19.03.2024 | Business Performance & Resilience, KPMG Law Insights

CSDDD: Provisional agreement on the EU Supply Chain Directive

The EU member states agreed on the CSDDD, the EU Supply Chain Directive, on March 15, 2024. Germany abstained from the vote. Negotiators from the…

19.03.2024 | KPMG Law Insights

The AI Act is coming: EU wants to get a grip on AI risks

For many people, artificial intelligence (AI) is the great hope for business, healthcare and science. But there are also plenty of critics who fear the…

21.02.2024 | KPMG Law Insights, KPMG Law Insights

The Digital Services Act – what does it mean for companies?

The Digital Services Act (DSA) is a key component of the EU’s digital strategy and came into force on November 16, 2022. As a regulation,…

15.02.2024 | KPMG Law Insights

Data compliance management: How to implement it in practice

Part 3 of the article series “Professional tips for data compliance management”   The third part of this series of articles deals with data compliance

14.02.2024 | Business Performance & Resilience, PR Publications

Guest article in ZURe: Monitoring the implementation of the LkSG

The current issue of ZURe (p. 20 ff.) contains a guest article by KPMG Law Partner Thomas Uhlig (Head of General Business and Commercial Law),…

09.02.2024 | KPMG Law Insights

Podcast series “KPMG Law on air”: The employment law function

In almost all German companies, the employment law function is located in the HR department and not in the legal department. One of the reasons…


Dr. Stefan Middendorf

Duesseldorf Site Manager

Tersteegenstraße 19-23
40474 Düsseldorf

tel: +49 211 4155597316

Dr. Martin Trayer


THE SQUAIRE Am Flughafen
60549 Frankfurt am Main

tel: 49 69 951195565

© 2024 KPMG Law Rechtsanwaltsgesellschaft mbH, associated with KPMG AG Wirtschaftsprüfungsgesellschaft, a public limited company under German law and a member of the global KPMG organisation of independent member firms affiliated with KPMG International Limited, a Private English Company Limited by Guarantee. All rights reserved. For more details on the structure of KPMG’s global organisation, please visit

 KPMG International does not provide services to clients. No member firm is authorised to bind or contract KPMG International or any other member firm to any third party, just as KPMG International is not authorised to bind or contract any other member firm.