Producing more,
faster and for less money.
That’s how Tönnies became Germany’s
biggest meat processing company.
And how Clemens Tönnies became
a bill- ionaire.
But in June, 1,500
contract workers at the company’s
Rheda-Wiedenbrück facility
caught Coronavirus.
Most came from
Eastern Europe and lived in cramped,
shared apartments like these.
So many people live in such a small space.
There might be one toilet for ten people.
Contract workers get less money and fewer rights.
And not just in the meat industry.
German Labor Minister Hubertus Heil
now wants to change things.
We will ban contract work and
temporary work in the core activities
of the meat industry.
The pandemic called attention to
contract-worker exploitation in Germany.
The town of Verl, near Rheda-Wiedenbrück,
at the end of June.
Thousands of people from Eastern Europe
are essentially under house arrest,
guarded by police.
Their work at the Tönnies
slaughterhouse has been suspended.
Around 7,000 employees are in quarantine.
A few kilometers away, a relief operation is underway.
Rheda-Wiedenbrück residents have made donations for the workers.
One of the organizers is Inge Bultschnieder.
For over seven years she’s been fighting for
the rights of Tönnies workers.
There’s much more than we ever expected.
It happened at very short notice.
Our idea is to give care packages in solidarity.
So the workers see that this anger isn’t
directed at them, but at others.
Over a thousand packages have been collected,
containing food, toiletries, and even toys.
Plamena Georgieva and Stanimir Mihaylov
distribute donations in Verl,
where many Tönnies workers live in shared apartments.
Mihaylov and Georgieva give support to
migrant workers from Eastern Europe.
They translate for us.
One Bulgarian says he’s been a meat cutter
for Tönnies for eighteen months.
For example, if a veterinarian marks
any spots on the pig that are not suitable for consumption,
one of his jobs is to cut them off.
The man is employed by a subcontractor.
He gets the minimum wage, ?9.35 an hour.
He hasn’t received a paycheck for months.
He lives here,
in an 80 square meter apartment with eight others.
Next door we meet some men and women from Poland.
The men are contract workers for Tönnies
and also live here in collective accommodation.
How many live here?
Eight or nine.
They’re three-room apartments.
We want to know more about the Tönnies workers’ living conditions.
We say we’ll give them a camera for
20 minutes so they can take some pictures of their place.
One of the men refuses.
The other one takes our camera
and goes off to take some pictures.
But after a few moments he comes back.
Another man appears behind him.
He doesn’t seem to like the contract worker talking to us.
The worker is told to give the camera back.
We ask who the man is.
Is that the boss?
Yes.
He sends the workers back into the house.
He ordered them to leave?
It’s a shame that happened.
Because some of them wanted to talk to us
and to tell us what was happening to them.
I hope there are no bad consequences for them now.
Workers behind fences, guarded by police.
How did it come to this?
In June 2020, there was a Coronavirus outbreak at
Tönnies in Rheda-Wiedenbrück,
Germany's largest slaughterhouse.
These pictures are from before the pandemic.
The ventilation system is said to be to blame for the mass infections,
as well as insufficient physical distancing between employees.
One of the workers talked about his experiences in a cell phone video.
As long as you felt healthy, no one worried that you kept working.
They only cared about the money.
They didn't care if we died or not.
It’s likely the employees spread the virus
from the workplace to their homes.
Many live with three to four people in a single room.
So the outbreak grew.
More than 6,000 Tönnies workers were tested.
More than fifteen-hundred were positive.
Locals were also being tested.
In June, the district went into lockdown again.
And Tönnies working conditions became a focus of global attention.
A small village in the south of Romania.
Alberto Gogu lives in this house with his family.
He literally fled from Rheda-Wiedenbrück in mid-June.
As a contract worker at Tönnies
he experienced the coronavirus outbreak.
He says physical distancing at work was impossible.
Even in the canteen it was too crowded.
We were told to distance ourselves, but that was impossible.
Otherwise we’d have to be standing up.
Alberto says that when the first workers got sick,
he and his colleagues had to work much more.
He was doing up to 12 hours a day on the production line,
even when he felt sick himself.
I told the boss, I'm not feeling well,
I have to see a doctor.
She said, You’re not going anywhere.
Alberto was afraid of catching Coronavirus.
He went back to Romania in mid-June.
He’s spent the last 12 years doing contract work in Germany.
But after his experiences in the last few months,
he says he’s had enough.
Thousands of people like Alberto Gogu work at Tönnies,
even though the company doesn’t actually employ them.
Here’s how this system of contract work
and temporary work functions.
Usually, companies have a core workforce.
If there’s more to do at short notice,
temporary workers can be hired.
They become part of the company for a limited time.
Temporary work is rare in the meat industry.
What’s common is contract work.
This is when a company hires subcontractors to
carry out a specific job,
like cutting up animal carcasses.
The subcontractor sends its workers to do the job.
The original company pays for the work to be done,
but doesn’t take responsibility for the personnel who do it.
They don’t belong to the company.
The Tönnies site at Rheda-Wiedenbrück works with around 25 subcontractors,
who mostly source their workers from Eastern Europe.
Of a total of 16,500 employees,
only half are employed by Tönnies.
The other half are contract workers.
That’s the system Inge Bultschnieder is fighting against.
When she heard about the
poor working and living conditions at Tönnies,
she decided to act.
In 2013 she and others founded a group to
help those affected by exploitative employment.
She shows us articles about her work.
As early as 2014, the group was pointing out
contract workers’ often alarming living conditions.
We laid out the plan of the building with a tarpaulin,
and used labels to show what we’d seen.
There’d be a bed, and even that might be a bunk bed.
So many people live in such a small space.
There might be one toilet for ten people.
Bultschnieder shows us a cell phone video she made
in a flat shared by Tönnies workers.
The living rooms are filled with beds,
three to four people sleep in a room.
The bathroom is completely run-down.
Today, many say they knew nothing about the situation.
But Bultschnieder and her fellow-activists have been
criticizing these conditions for seven years.
In 2015, they took their concerns to the highest level.
Sigmar Gabriel, then economy minister and vice-chancellor,
visited them.
He took notes as he heard about the situation.
He was so interested.
We felt sure that now something would change.
When he left our house, we cheered.
We said, Now something will happen.
She could hardly believe what happened next.
Clemens Tönnies took Gabriel on a guided tour of
his meat processing plant, in front of the cameras.
It was a PR coup for the businessman.
The Vice Chancellor was full of praise,
despite knowing about the problems at Tönnies.
Later he wrote on Facebook.
...it's good that Tönnies sets positive standards in
an industry that also has its share of bad apples.
5 years on, Sigmar Gabriel briefly worked
for Clemens Tönnies as a consultant —
for 10,000 euros a month.
And Tönnies, with all his contacts in the political world,
is one of Germany’s richest people,
with an estimated private fortune of up to 2 billion euros.
Enough to employ a host of contract workers —
whose poor living and working conditions have been known for years —
and even a former German vice chancellor.
Not every part of the meat industry relies on contract workers.
There are still around 13,000 so-called craft butchers in Germany.
Herbert Dohrmann runs five of them in Bremen.
His family business employs around 70 people.
How many of your personnel are contract workers?
None of them.
They wouldn’t be here if I put them on a work contract.
And temporary workers?
No temporary workers either.
A lot of them have been with me for over ten or 15 years.
Pork chops from a cheap supermarket might cost six euros a kilo.
Dohrmann charges double that.
It’s not only because of higher wages.
Large slaughterhouses have lower costs.
Factory farmed pigs are cheaper.
It’s advertised as regional pork, that’s all very well.
But look. The certification level is one.
That’s industrial pig farming,
where only the lowest requirements of animal welfare are fulfilled.
As president of the German Butchers' Association,
Dohrmann says small butchers are at a disadvantage.
For example, a government-certified veterinary
examination of a pig costs a small business up to 24 euros.
Businesses that slaughter several thousand animals a day pay less,
according to regional fee scales.
At the big industrial places that price is
at most one-fifty to two euros.
In addition, small butchers pay higher fees for
disposing slaughterhouse waste and spend more on
electricity because of renewable-energy levies.
Dohrmann isn’t trying to match the
industrial slaughterhouses’ prices.
But he does want more support from politicians.
We don’t want special treatment, just equal treatment.
Giant slaughterhouses aren’t just a threat to smaller competitors,
but often to their own workers too.
Volker Brüggenjürgen is the chairman of the
charity Caritas in the district of Gütersloh.
He’s witnessed how the Tönnies company went from being
a simple butcher's store to Germany's
largest slaughterhouse and meat-processor.
He says Clemens Tönnies made his
fortune at the expense of workers.
Tönnies makes most of the profit, of course.
There's no question that they’ve exploited the
poverty gap for professional gain.
They also profit because if there are blatant violations,
it’s always the subcontractors’ fault.
Tönnies always keeps its hands clean.
Brüggenjürgen has been advising Tönnies
contract workers and their families since 2016.
He and his colleagues have held more than 10,000 consultations.
He knows the methods used to keep monthly wages low.
Technically, the minimum wage is what’s on the pay slip,
but then there might be 150 or 300 euros
deducted for accommodation.
Or for cleaning materials or shoes.
Whatever they can deduct.
Or they increase the rent when people are sick.
That type of thing.
There isn’t much left over from the minimum wage.
Most of the several thousand contract workers at
Tönnies are from poor parts of Eastern Europe.
They hardly speak any German.
They’re brought to the country and put into
cramped shared accommodation.
This also has wider effects on the region.
This business model means that more and more
poorer people with little education come to the region,
and at some point society is no longer able to cope.
It definitely threatens social cohesion.
We asked Tönnies Holding to comment on the
living and working conditions of contract workers.
In a written response, the company didn’t go into detail.
But it did say it aims to gradually change working conditions.
It plans to directly employ workers in the areas of
slaughtering, cutting and packaging...
"...by the beginning of 2021."
One factor that led to the current situation was a
concerted political push for labor market flexibility.
That was a key part of Social Democrat
Chancellor Gerhard Schröder’s so-called “Agenda 2010”.
Ladies and gentlemen, we’re going to have to
cut back on state benefits, demand personal responsibility
and ask more from each individual.
Agenda 2010 ushered in contract work,
temporary work and so-called mini-jobs.
At the University of Applied Sciences in Koblenz,
Professor Stefan Sell examines the causes of precarious employment.
He says Schröder's labor reforms,
also known as the “Hartz reforms”,
weakened workers' rights.
What the Hartz laws brought with them was
enormous deregulation of protective labor-market provisions.
They enabled temporary work,
and in my view they made it easier to
abuse something like contract work.
Since the Hartz reforms, employers in many industries have
used all legal means to keep wages low and profits high.
Even though contract work was really designed to
address seasonal demands for extra labor.
The problem in many industries is that the
core business activity is now
permanently carried out by contractors.
We’ve seen it in the meat industry.
We also see it in logistics, but above all in the construction sector.
There, the general work has been done by
contract workers for years.
It has nothing to do with periods of peak demand.
Contract work has many advantages for employers.
If workers stay home because of illness, vacation or pregnancy,
it doesn’t cost the employer a cent.
Contract workers also have no voice within the company.
Contract work releases the employer from
all the obligations they’d normally have to their employees.
They buy workers through a subcontractor
the way they’d buy screws or other goods.
So the costs aren’t personnel costs, they’re material costs.
The Tönnies scandal brought yet another
shock to the political establishment,
pushing lawmakers to ensure that
workers from abroad were paid fairly.
Germany’s upper house, the Bundesrat,
voted on a bill to guarantee that workers from other EU countries
would get the same pay as German colleagues,
an effort to prevent so-called “social dumping”.
Bundestag lawmaker Beate Müller-Gemmeke
has been fighting against precarious employment in
the meat and agricultural industries for years.
We’re demanding that contract work and temporary
work be prohibited when it comes to a business’s core activity.
Companies have to take responsibility themselves, and employ people.
We think it’s very important that safeguards are strengthened,
and that there’s one single safeguard mechanism for
wages, working hours, occupational health and safety,
health protections and accommodation.
Again and again there have been legislative attempts to
protect workers from “social dumping”
and abuses of the contract work system.
We asked Germany’s Labor Ministry for an interview
about the issue several times, without success.
So instead we approach labor minister Hubertus Heil
after the Bundesrat session.
We’ve brought a list of almost 20 legislative
initiatives intended to stop precarious
employment relationships in recent years.
Almost all were either rejected or languished in a desk drawer.
Why can’t the government do anything about
precarious employment in Germany?
It is the state’s job to do something,
but in our system it’s above all the job of
stakeholders like unions and employers.
And there’s the problem.
Our system of social partnership has eroded in recent years.
Fewer and fewer employers are in employers' associations,
and in many sectors far too few employees are in unions.
To put the blame at the door of unions and employers doesn’t quite wash.
We push the minister on why there’s been little action from politicians.
You only have to see that in these cases either
lobbyists have watered down laws, or if
there were strong regulations, circumvented them with
trickily written contracts involving sub-sub-contractors.
I’m determined to clean up the industry.
Through digital recording of working hours?.
By emphasizing the responsibility of the states
to adhere to binding inspection quotas with work safety authorities,
and not just in the meat industry.
And by having clear and enforced rules
regarding employee accommodation.
Because the strictest rules are no use if they’re not enforced.
And we’re going to ban contract work and
temporary work in the core activities of the meat industry.
With that, Hubertus Heil would be taking on
some of the biggest companies in Europe —
big in part because they keep wages low through contract work.
We asked the Employers Association for Food and Consumption for comment.
They declined an interview, directing our questions to
a meat industry employers group, the S.P.A.
They gave us this written response regarding the
planned abolition of contract work and temporary work in the meat industry.
Contract work is an important instrument of flexibility?
Without flexibility, the meat industry will go abroad
and more than 50% of jobs will be threatened.
The S.P.A.’s argument is one that employers often make.
But others strongly disagree.
Professor Marcel Fratzscher works for the
German Institute for Economic Research.
Germany’s not in danger of losing this industry
if there are fewer atypical employment arrangements.
That’s a myth with no basis in fact.
The fact is that German companies are very competitive internationally,
not because of atypical employment but because
of their highly productive employees.
This “atypical employment” includes temporary work and contract work,
but also so-called “mini-jobs”,
fixed-term contracts and part-time work.
Almost a third of German workers have this kind of employment.
That figure has risen sharply since the 1990s.
And not just in the meat industry.
It happens in many other sectors, including logistics.
The Dortmund Logistics Company, or DLG,
is a subsidiary of discount retail giant TEDi.
It supplies TEDi stores throughout Europe.
In October 2019, we reported on how
workers here were striking for better wages.
The then head of the employee organization, Philip Keens,
fought for years for a collective agreement.
There are no negotiations.
The employer is refusing to talk to the union.
According to the employee organization
the company had about 640 employees in 2019.
Of these, about 350 were said to be contract workers.
Only 290 women and men were on permanent staff.
A year on, we meet Philip Keens again.
He’s now union secretary at the trade union “Verdi”.
We ask what’s changed at the DLG.
It’s worse today than it was before.
We now have twice as many contract workers as permanent staff.
That means that DLG and TEDi are really pushing to
use contract work to oust their own employees.
The reduction of permanent staff is in full swing in many industries.
What employers call flexibilization means
insecurity and lower pay for employees.
It’s not just about the meat industry.
Work contracts are a problem.
There used to be entrepreneurial risk.
The entrepreneur had the money,
but they also had the risk if there was no work to do.
That’s fallen completely by the wayside.
Today they say they need people to be on call when there’s work,
but they should just disappear when it’s done.
Just so long as they don’t have to pay anyone to stand around.
The German Institute for Economic Research’s
Marcel Fratzscher is also critical of the fact that companies
often exploit contract work and other such employment arrangements.
It can’t be the goal of German economic policy to
participate in undercutting competition in Europe,
to push wages ever lower and promote ever more atypical employment.
After all, we know that the goal of companies has to be to
be productive and to offer better products.
And we can see that atypical employment tends
to damage that kind of competitiveness.
Since the 1990s, Germany's low-wage sector has grown by 60 percent,
mainly thanks to Chancellor Schröder's Agenda 2010.
In a recent study for the Bertelsmann foundation,
the German Institute for Economic Research found that
around 7.7 million Germans had low-wage jobs.
More than a fifth of employees work for
less than 60 percent of the median income,
less than eleven euros forty an hour.
That’s a lot of people by international standards.
In almost all neighboring countries,
there are fewer workers in the low-wage sector than in Germany.
In Denmark for example,
workers in the meat industry are much better paid.
At the Danish food trade union NNF we meet Jim Jensen.
He used to work as a meat cutter himself.
We ask him how many contract workers there are
in the Danish meat industry.
None.
Why not?
Because they have to be employed according to collective agreement.
They have to be hired by the employer
and they have to work for the agreed wages.
At the big Danish slaughterhouses,
almost all employees are directly employed by the company.
Wages are also much higher.
German meat cutters usually only get the
statutory minimum wage of ?9.35 an hour.
Danish employees receive a standard wage of 27 euros on average —
almost three times as much.
Surely no one can afford Danish meat at those rates?
Maybe 2 or 3 percent of the cost of a cutlet will be labor costs.
It might be 2 percent in Germany and
3 percent in Denmark — no more.
So the wage competition is only to make profit.
You can make more profit in Germany than
you can here in Denmark.
Jensen says Danish meat companies also try to push down wages.
But here, almost all employees are in the union.
That unity makes the workforce strong when
companies don’t want to strike collective agreements.
We can ask for help and support from the other unions.
Then no electrician will come to that company,
no truck driver will drive in or out, and so on.
Sooner or later we can persuade them to
enter into a collective agreement.
Even Tönnies itself faces those conditions in Denmark.
We also have Tönnies here in Denmark.
It has two slaughterhouses,
one in Brörup and one Thisted.
Are their workers contract workers?
Not at all. They’re employees, employed by Tönnies.
They get the same as everyone else in the industry.
Denmark shows that it’s possible to
run a business successfully and pay employees fairly.
Profit-making through precarious employment is
something Germany has perfected above all other European countries.
The practice should end in 2021, at least in the meat industry.
As for other industries, this legal exploitation is likely to continue.