German prosecutors sought charges against a present Volkswagen manager along with a former manager and two former board members, alleging of them awarding works council members inflated incomes.
The Braunschweig prosecutor stated that managers accountable for personnel issues stand alleged of a breach of fiduciary trust for awarding salary and bonus awards that caused damages worth 5.05 million euros ($5.57 million).
A court must now decide if the allegations by the prosecutor’s office in Braunschweig, are going to be brought before a judge.
A spokesman for Volkswagen last week stated that there had been no misconduct in relation to deciding proper salary levels for works council representatives.
Under the country’s two-tier board system, employees have seats on the firm’s board of directors, with broad powers to veto sweeping strategy decisions.
Upon deciding which level of income to award works council members, members of VW’s personnel committee intentionally inflated pay by choosing to benchmark peers in a higher income band, making sure that VW’s labor leaders got a pay increase, the prosecutor’s office stated.
From 2011 to 2016 five members of the works council got excess pay, with 3.125 million euros awarded to the works council chief, the prosecutor’s office stated.
Such awards were to the “disadvantage” of the firm, the Braunschweig prosecutor’s office stated.
