Personnel adjustments during the Covid-19 pandemic: did co-determination make a difference?

Abstract

Abstract Using a unique dataset of establishments in Germany surveyed during the Covid-19 pandemic, this study investigates whether personnel adjustments during the crisis differed between establishments with and without a works council. Our regression analyses show that the hiring and dismissal rate as well as the churning rate were lower in establishments with a works council. In contrast, the net employment growth rate over the pandemic and the implementation of short-time work did not differ significantly between establishments with and without a works council. We conclude that worker co-determination did indeed make a difference in terms of higher employment stability for the incumbent workforce during the pandemic.

Keywords

• Works councils
• Co-determination
• Personnel adjustments
• Covid-19 pandemic