Regulation, normativity and organisation of corporate social policy. An interregional study of the German metal industry 1871–1932

Completed PhD Project

Over the course of the 19th century, industrial companies increasingly provided their employees with social benefits that went beyond wages. Starting with company (insurance) funds, further supplementary measures were introduced, such as housing and bonus payments. These benefits served as labour market incentives to recruit and retain workers; they increased discipline and good behaviour through selection mechanisms and established special regulatory systems within industrial labour relations. Company social policy thus appears to be part of a ‘non-state law of the economy’.

The study focuses on four social benefits and their normative development: company health insurance funds, company housing, vacation entitlement and length-of-service bonuses. These benefits represent the different normative potential of employers, employees, associations and government agencies and illustrate the diverse forms of autonomous and semi-autonomous rule-making. The study is based on corporate and government sources from the Ruhr area, Saxony, Württemberg and Berlin. In order to give proper consideration to various industrial structures, it also takes into account small and medium-sized enterprises, whose scope for action has often been neglected in research to date. The period under investigation, from the German Empire to the Weimar Republic, reveals continuities and disruptions resulting from economic crises, legal interventions and changing operational needs.

Corporate social benefits were not necessarily the result of advance planning on the part of companies. Company health insurance funds often originated from employee-run institutions that were then institutionalised; later, due to statutory contribution requirements, numerous companies decided to set up their own funds in order to tie health insurance to the company sphere. Other practices – such as length-of-service bonuses – were only gradually formalised and developed into functional equivalents of law.

Despite the variety within the scope of benefits and conditions, a functional core of rules remained stable across industries and regions, as it fulfilled key operational purposes. This core stayed intact throughout the entire period under review, partly because government interventions – such as trends to centralise health insurance, tenant protection or state housing management – may have exerted influence on internal company standards but did not fundamentally replace them, out of deference to business interests. Matters such as holidays or bonuses largely remained part of a comparatively flexible ‘non-state’ regulatory framework due to the lack of legal entitlements, which in turn showed tendencies towards formalisation and ‘juridification’ (e.g. collective agreements) and influenced implementation processes at company level.

The study thus combines corporate and legal-historical analyses of company social benefits and paints a nuanced overall picture of an industrial sector.