VW crisis: Labour groups propose wage cuts

The upcoming negotiations will show whether the labour groups’ proposal will bear fruit. It provides for the aforementioned wage cuts and a future fund: the next wage increase would be paid into the fund for a limited period and not paid out. It should enable “flexible reductions in working hours without redundancies.”

In return, the works council and trade union demanded that the job security agreement cancelled by management in September be reinstated. And not just for the six plants in western Germany, but also for the three factories in Saxony. It would once again rule out redundancies for operational reasons.

IG Metall district manager Thorsten Gröger calculates that the future concept should result in savings of around 1.5 billion euros in labour costs.
In September, VW not only cancelled the job security agreement. It also announced that it would shut down the German locations – without naming any names. However, it is clear that EV production (cars or components) will also be affected at three locations.

VW wants to ‘financially evaluate’ proposals

It is unclear whether the Group will accept the offer. After all, it is still essentially a pay rise, even if it is not paid out but put into a fund. The Executive Board previously demanded billions in savings and plant closures – accepting a (hidden) pay rise does not quite fit the picture.

The company initially reacted cautiously and would prefer to discuss the proposals internally during collective bargaining. “For Volkswagen AG, the sustainable achievement of the financial target and thus competitiveness remains the focus,” said Chief Human Resources Officer Gunnar Kilian.
The specific proposals would have to be evaluated financially and discussed in detail during the collective bargaining round.

IG Metall and the Works Council appear to be pursuing a slightly different communication strategy, which may have been coordinated. While union representative Gröger is keeping up the pressure, threatening to stage massive resistance “never before seen in Germany,” VW Works Council Chairwoman Daniela Cavallo has been somewhat more moderate in her comments this week.

“Because sustainable solutions are needed, we are now going on the offensive and presenting a solution concept,” said Cavallo, describing the concept as a “master plan” to ensure the company’s long-term viability. And: “We are not fundamentally opposed to staff cuts. However, it must be carried out in a socially responsible manner.” However, the employee representative did have one point to make: management should forgo bonuses and instead contribute them to the fund.

The so-called mandatory labour peace in the wage dispute expires at the end of November. If no agreement is reached by then (which is currently considered unlikely), strikes or other labour actions at Volkswagen are possible from 1 December.

spiegel.de, zeit.de, heise.de (in German), yahoo.com