by Business Case Studies on Monday 25th June, 2007


The last few months have seen reports of negotiations with the German telephone firm Deutsche Telekom and the trade union Verdi.In March the phone company reported a large down-turn in profits.Whilst trying to find areas to create sales growth, the firm was also looking for ways to cut costs (The Times, March 2nd 2007).

In April, the BBC reported that unions were threatening strike action against a proposed extension to working hours and cost cutting measures made by Deutsche Telekom (BBC, 26th April 2007).After six weeks of walk-outs by workers and a series of difficult negotiations, Deutsche Telekom has secured a deal with unions that will see 50,000 support centre workers accept both lower pay and longer working hours.In return for these worsening contracts, workers will gain job security until 2012 (BBC, 20th April).

This story clearly illustrates that the role of unions is much more than negotiating wage increases for their members.For further understanding of the role of unions, read the Times 100 case study about UNISON, the public sector union.


Deutsche Telekom suffers 43% profits fall – TimesOnline, 2 March 2007

Deutsche Telekom gains union deal – BBC News, 20 June 2007

Telekom talks with union collapse  – BBC News, 26 April 2007


Video clips:

Deutsche Telekom Union Deal – BBC News Video Clip

Suggested research project:

          Other than wage bargaining with employers, what other services do unions provide?

          How has the role of trade unions changed in the UK in recent decades?

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