Inflation with Consequences for Collective Bargaining Agreement in Retail

Due to high inflation, the collective agreement for trade employees, which was concluded for two years, must be reopened. The social partners had agreed last year that if the inflation rate is 3 percent or more in the period from October 2024 to September 2025, the collective agreement increase for 2026 must be renegotiated. With the preliminary September inflation data published today, the rolling inflation of the last twelve months stands at 3.0 percent.

Trade Collective Agreement: Negotiations are Coming

The union and the Chamber of Commerce have now agreed to start trade collective agreement negotiations from the beginning of November. The current metalworkers' agreement below inflation and the civil servants' salary agreement are being cited by some economic representatives as a model for other sectors. "We don't have to do copy and paste," said WKÖ trade chairman Rainer Trefelik to APA. They want to negotiate "in a calm manner" to preserve jobs and businesses. The new GPA federal manager Mario Ferrari and chief union negotiator for the trade collective agreement insists on "appropriate compensation" for inflation. "Wage restraint is not the solution," Ferrari told APA. The increase in energy, services, food, and rent costs is "hard to bear" for employees.

As a voluntary interest group, the trade association is not at the negotiating table for the collective agreement negotiations but sees a connection to food prices. "Due to the cheap price debate on food triggered by the SPÖ, the scope for the upcoming collective agreement renegotiations is severely limited," said trade association managing director Rainer Will in a statement. "Every wage increase naturally affects the prices on the shelf." Job security must "now be the priority," Will explained.

The social partners had agreed last year on a staggered salary increase for 2026 depending on inflation. Specifically, the now obsolete agreement for the trade collective agreement 2026 looked as follows: Up to a rolling inflation of 2.3 percent, salaries would have been increased by 0.5 percent above the inflation rate. With an annual inflation of 2.4 and 2.5 percent, 0.4 percent would have been added. At 2.6 percent inflation, the increase would have been 0.3 percent, at 2.7 percent only 0.2 percent above inflation was planned, and at 2.8 percent only 0.1 percent. At 2.9 percent inflation, only the inflation would have been compensated. For a rolling consumer price increase of three percent or more, the social partners had agreed on renegotiations.

Trade Employs Thousands of People

The trade sector employs around 450,000 employees and apprentices as well as 120,000 workers in Austria. The economic downturn in 2023 and 2024 has led to declining real sales in trade. There were numerous bankruptcies in the fashion, shoe, and furniture trade, such as Kika/Leiner. From April to July, traders were able to record a real revenue increase again this year, but in August there was a real sales decline according to Statistics Austria. According to GPA federal manager Ferrari, the trade sector is "better off than originally forecasted." WKÖ trade chairman Trefelik wants to find "a solution" for the tense situation in trade. A reform process is currently underway for changes in the trade collective agreement framework law.

(APA/Red)

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