German corporations that used slave and forced labour during the Second World War were, for almost half a century after 1945, substantially insulated from any direct legal or financial reckoning with the surviving victims. The substantial post-war reparations programme was conducted through the West German state under the Luxembourg Agreement and the subsequent compensation laws; corporate liability was treated, by the German legal system and by the corporations themselves, as covered by the state programme and therefore not requiring separate corporate action. The position broke down in the late 1990s under American class action pressure and produced the establishment in 2000 of the Foundation Remembrance, Responsibility and Future (EVZ), the principal vehicle for corporate Holocaust reparations and the largest single corporate reparations settlement in history.
The corporate use of forced and slave labour
The use of forced and slave labour by German corporations during the Second World War was substantial and well-documented. The most-cited corporate cases include I.G. Farben (which built and operated the Buna-Werke synthetic rubber and fuel plant at Auschwitz III-Monowitz, using slave labour from the camp), Krupp (steel production using prisoner labour at multiple sites), Siemens (electrical production at multiple camp sites including Ravensbrück), Daimler-Benz, BMW, Volkswagen, AEG, Bayer, BASF and Hoechst (the three Farben successor companies after the 1951 break-up), Deutsche Bank, Dresdner Bank, Commerzbank and Allianz. The total number of forced and slave labourers in the German wartime economy was approximately 12 million, of whom around 1.5 million died in conditions ranging from chronic underfeeding to systematic killing.
The post-war Nuremberg Industrialists Trials prosecuted senior figures of I.G. Farben, Krupp and Flick. Most defendants were convicted, served short sentences, and returned to prominent positions in West German business. The corporations themselves were not, in general, prosecuted as legal entities, and the post-war West German legal system did not subsequently develop a substantial body of corporate liability for wartime conduct.
The American class action pressure, 1997 to 2000
The shift came principally through American litigation. From 1997 onwards, class action lawsuits were filed in United States federal courts on behalf of surviving slave labourers and their heirs against German and Swiss corporations. The lawsuits were brought under American law that allowed claims for human rights violations regardless of where the violations had occurred, and on the basis that the corporations had assets and operations in the United States that gave the courts jurisdiction.
The lawsuits produced substantial financial pressure on the named German corporations. The companies argued initially that the suits were barred by the Luxembourg Agreement and the subsequent compensation legislation, which had been intended (in the corporations’ reading) as a final settlement. The American courts were not persuaded; the German government and the German corporate associations recognised that protracted litigation would produce reputational damage and uncertain financial outcomes, and entered negotiations with the United States government, the State of Israel, the Claims Conference and the plaintiffs’ representatives in 1999 and 2000.
The Foundation EVZ, 2000
The negotiations produced an agreement, signed on 17 July 2000, that established the Foundation Remembrance, Responsibility and Future (Erinnerung, Verantwortung und Zukunft, EVZ) by federal German law. The Foundation was capitalised with ten billion Deutschmarks (around five billion euros), contributed equally by the German federal government and by a consortium of approximately 6,500 German corporations through the Foundation Initiative of German Industry. In exchange for the establishment of the Foundation, the United States government undertook to provide “legal peace” by intervening in pending and future class actions to argue that the Foundation’s payments were the appropriate remedy.
The Foundation made payments to approximately 1.66 million surviving former slave and forced labourers in approximately 100 countries through partner organisations (the Claims Conference for Jewish recipients, national foundations in Poland, the Czech Republic, Russia, Ukraine, Belarus and elsewhere for non-Jewish recipients). The standard payment to former slave labourers (those who had worked under the most extreme conditions, principally in the camps) was 7,500 euros; the standard payment to former forced labourers (those who had worked under less extreme but still coercive conditions, principally civilian deportees) was 2,500 euros. The payment process ran from 2001 to 2007 and was substantially complete by then.
The Foundation’s continuing work
The EVZ Foundation, after completing the slave-labour payments in 2007, has continued as a permanent institution funded by the residual capital and by additional contributions. Its current work is principally educational and memorial: funding for human rights education programmes, support for civil society organisations in countries affected by Nazi persecution (especially in Central and Eastern Europe), historical research on forced labour and other Nazi crimes, and the operation of an archive of the documentation gathered for the payment programme. The Foundation’s work is the principal continuing institutional expression of the corporate German engagement with the wartime past.
The wider significance
The EVZ Foundation represented the most significant single act of corporate Holocaust reparations and the largest corporate human rights settlement in history. It acknowledged that German industry bore a share of the moral and financial responsibility for the use of slave and forced labour during the war that the post-war state programmes had not adequately addressed. It established a precedent for corporate reparations in subsequent post-atrocity contexts, including the litigation against Swiss banks, French banks, American insurance companies and others. The Foundation’s continuing educational and memorial work represents a model of corporate-government partnership in post-atrocity reckoning that has been studied and partially replicated in other contexts.
See also
- Krupp
- Deutsche Bank and Dresdner Bank
- The Luxembourg Agreement 1952
- The Foundation Remembrance Responsibility and Future
- IG Farben
- Volkswagen
- Daimler-Benz
Sources
- Stuart E. Eizenstat, Imperfect Justice: Looted Assets, Slave Labor, and the Unfinished Business of World War II, Public Affairs, 2003 (Eizenstat was the chief American negotiator)
- Constantin Goschler, Schuld und Schulden: Die Politik der Wiedergutmachung für NS-Verfolgte seit 1945, Wallstein, 2005
- Lutz Niethammer (ed), Der “gesäuberte” Antifaschismus: Die SED und die roten Kapos von Buchenwald, Akademie Verlag, 1994
- Peter Hayes, From Cooperation to Complicity: Degussa in the Third Reich, Cambridge University Press, 2004
- Benjamin B. Ferencz, Less than Slaves: Jewish Forced Labor and the Quest for Compensation, Indiana University Press, 1979 (revised 2002)
- Foundation Act establishing the Foundation Remembrance, Responsibility and Future, 2 August 2000
- Stiftung Erinnerung, Verantwortung und Zukunft, https://www.stiftung-evz.de