Volkswagen returns to three-shift system

In January 1999, Volkswagen, the German motor manufacturer, announced a return to the "classic" three-shift production system, thus putting an end to the working time system introduced in 1994 in order to save employment and production locations in Germany.

In 1993, the German car producer Volkswagen AG experienced a dramatic decline in automobile purchases, threatening to lead to mass redundancies. Thus, in December 1993, VW and the IG Metall metalworkers' trade union concluded a "collective agreement to secure production locations and employment" (Tarifvertrag zur Sicherung der Standorte und der Beschäftigung der Arbeitnehmerinnen und Arbeitnehmer bei der Volkswagen AG).

The most important provisions of the two-year agreement were a no-redundancy clause and the introduction of a four-day working week of 28.8 weekly working hours instead of 36 hours (a reduction of 20%). The corresponding initial reduction of monthly income was compensated by a whole package of measures, including an increase in monthly wages, the redistribution to the monthly wage of the "13th month" bonus (96% of one month's gross wage or salary) and of two-thirds of holiday pay (70% of one month's gross wage or salary), and additional VW contributions of roughly 2%. This allowed the employees to maintain their previous monthly gross wage. In total, weekly working hours were reduced by 20% and the average gross income by 16%. As regards the impact of the agreement, the measures improved the cost position of VW, while the shedding of 30,000 employees was avoided. The agreement was renewed, with minor modifications, in 1995 and 1997 (DE9707221F).

In January 1999, Volkswagen announced that production at its Wolfsburg production site would return to the "classic" three-shift model. This occurred after long negotiations between management and the works council, which were initiated by the latter. Subsequently, the works council distributed a pamphlet declaring an "end to whirling around" - ie an end to the 150 different working time models which were associated with the 1994 shift model and resulted in a number of social problems, such as higher divorce rates and stress in neighbourhood structures. Volkswagen will also profit from the three-shift system, since it extends production capacities and allows for flexible organisation of working time distributed over the week according to demand fluctuations. Furthermore, the company expects increases in productivity and quality.

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