Volkswagen clinches wage deal with Germany’s IG Metall union

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Europe’s largest carmaker Volkswagen has agreed a wage deal with Germany’s strongest union for 120,000 workers, representing 18% of its workforce, it mentioned on Tuesday.

The deal with IG Metall, struck after 14 hours of negotiations in what was the fifth spherical of talks, will see salaries rise by 2.3% from January 2022.

It additionally features a 1,000 euro ($1,190) one-off “corona support payment” in June 2021, the carmaker mentioned.

“We have reached a wage agreement that is both proportionate and reasonable and that reflects the particularly challenging environment since the start of the pandemic,” Arne Meiswinkel, Volkswagen’s chief collective bargaining negotiator, mentioned.

Volkswagen, the world’s second-largest carmaker, may even enhance the corporate’s pension scheme by 150 euros monthly from September 2021 onwards, it mentioned.

IG Metall had initially requested for a wage enhance of 4% and final month dismissed Volkswagen’s most up-to-date provide of a 250 euros cost for the primary half of 2021 and a wage enhance of 1.2% for 2022.

Volkswagen has seen its shares rise by greater than half because the begin of the 12 months, shrugging off the influence from the coronavirus pandemic and a chip scarcity that has hit the automotive sector.

This provides the carmaker, whose shares had been flat on Tuesday, a market worth of about 136 billion euros, making it Germany’s most respected listed firm.

“Workers have earned their fair share of the company’s success for, after all, it’s they who have helped Volkswagen to navigate through the crisis profitably despite adverse conditions related to the pandemic,” Thorsten Groeger, who led negotiations for IG Metall, mentioned.

Employers have warned that a whole bunch of 1000’s of jobs might be misplaced in Germany if Europe’s largest financial system can not enhance its competitiveness and have mentioned there was restricted room for wage will increase.

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