Volkswagen AG and IG Metall union reached an agreement over a rise in pay for the company’s workers in Germany. As of September 1, 2013, base pay for employees covered by the collective bargaining agreement will increase by 3.4 percent, followed by a further rise of 2.2 percent from July 1, 2014, BusinessWeek reported.
The German automaker also agreed to make an additional contribution to company pension arrangements. For employees covered by the collective bargaining agreement, the company will make a one-time payment of €300 to the company pension scheme. For apprentices and dual-study program students, Volkswagen will pay a monthly contribution of €27.
VW seems to be in a spending mood, as earlier this year, it also awarded hefty bonuses to its workers in Germany. “This collective bargaining agreement stretches us to the limit of what is possible in light of the difficult market situation in Europe and tough international competition,” said Dr. Horst Neumann, Volkswagen AG Board of Management Member for Human Resources, hinting that maybe this was not the right time for such a move.
The new company collective bargaining agreement has a term of 20 months (July 1, 2013 to February 28, 2015). However, VW and IG Metall agreed to analyze economic conditions in May 2014 and if the economic situation at that time permits, negotiations will be held to establish whether a further one-time benefit payment financed by the company is possible.
The collective bargaining agreement of Volkswagen AG covers some 102,000 employees at the plants in Wolfsburg, Brunswick, Hanover, Salzgitter, Emden and Kassel as well as Volkswagen Financial Services AG.
By Dan Mihalascu
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