New company agreements signed at Volkswagen AG

In September 2000, the collective bargaining parties at Volkswagen AG in Germany concluded new company agreements which provide for pay increases, as well as an extension of existing agreements on bonus systems, supplementary pensions and partial retirement.

On 18 September 2000, the executive board of the German car producer Volkswagen AG and the Lower-Saxony district organisation of the IG Metall metalworkers' union signed new company agreements for the 100,000 or so employees at the company's west German production locations. Volkswagen AG is the only German car producer which is not covered by the branch-level collective agreements for metalworking but has traditionally had a company agreement.

The new collective agreements provide for a 3% increase in wages and salaries from 1 January 2001 and a further 2.1% increase from 1 February 2002. In addition, the employees will receive a flat-rate payment of DEM 850 for the period from October to December 2000. Vocational trainees will receive corresponding pay increases but no flat-rate payment. The pay agreements run until 30 September 2002.

Furthermore, the bargaining parties agreed on an extension of the existing collective agreements:

  • on bonus systems until 31 December 2002;
  • on supplementary pensions until 31 December 2005; and
  • on partial retirement (DE9707221F) until 31 July 2004.

IG Metall's chief negotiator, Hartmut Meine, who had originally demanded a 5.5% pay increase, stated that the provisions of the new Volkswagen company agreement are similar to what has recently been agreed in metalworking (DE0004255F). Mr Meine emphasised that the flat-rate payment of DEM 850 means that the new Volkswagen agreement has an important "social component", which favours low-income groups. From the trade union perspective, a negative aspect of the agreement is the fact that vocational trainees will be excluded from the flat-rate payment. The chief negotiator for Volkswagen management, Jochen Schumm, declared that the agreed results correspond with the company's expectations.

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