Sickness Absence and Works Councils: Evidence from German Individual and Linked Employer–Employee Data

Using both household and linked employer–employee data for Germany, we assess the effects of nonunion representation in the form of works councils on (1) individual sickness absence rates and (2) a subjective measure of personnel problems due to sickness absence as perceived by a firm's management. We find that the existence of a works council is positively correlated with the incidence and the annual duration of absence. Further, personnel problems due to absence are more likely to occur in plants with a works council.