Volkswagen has agreed to raise the wages of an estimated of 120,000 employees in Germany by 4.3 percent from May, resolving a dispute that had triggered its strikes since 2004.
The deal revealed by Europe’s largest automaker and labor union IG Metall on Wednesday includes a 100-euro one-off payment, enhancements to Volkswagen’s business pension scheme and the right for some employees to select more time off instead of more money.
It also enables some workers’ hours to be increased momentarily to deal with projects, which has been a key demand of industrial companies in recent labor negotiations as they face full order books.
IG Metall had demanded a 6 percent wage boost for employees at VW’s facilities in western Germany, a bump in pensions and more hiring of apprentices to help deal with a market shift to electric vehicles and self-driving technology.
But Volkswagen, facing billions of euros in expenses and fines over its diesel emissions-test cheating scandal and big investments for its subsequent transformation plan, had dismissed the demands as extreme.
It had offered to raise wages by 3.5 percent and by an even more 2 percent over 30 months.
The 4.3 percent wage increase now concurred for a 27-month period mirrors a deal that IG Metall won for around 3.9 million industrial workers in Germany this month after rolling 24-hour strikes throughout the nation.
Volkswagen employees will likewise get an extra payment equivalent to 27.5 percent of their month-to-month wage once a year from next year.
Some employees with small children at home or who work a requiring shift schedule can choose to take 6 extra days off instead, the parties stated.
On the other hand, Volkswagen will have the ability to ask 5 percent and in special cases even 10 percent of the employees covered by the wage contract to temporarily increase their working hours to approximately 40 per week.