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January 25, 2024: Laszlo Goerke (Trier University)

Trade Union Membership and Bonus Payments

(joint work with Marco Clemens)

Abstract

This study provides the first comprehensive investigation of the relationship between trade union membership and non-performance-oriented bonuses. We expect a positive impact because union members have better knowledge how to obtain bonuses. Using data from the German Socio-economic panel (GSOEP), we observe that members are more likely to receive at least one bonus payment per year, a higher number of bonuses, and a higher expected amount. The results are driven by workers joining a union, whereas those who leave it exhibit no significant decrease in bonus payments. The positive union membership effect can also be observed for employees covered by collective bargaining agreements and codetermination via works councils.