Volkswagen has signed an agreement with the IG Metall union to increase the wages of its German employees by 4.3 percent over 13 months. The wage agreement between the company and the union takes effect June 1, 2012, and affects 97,000 VW production workers and 5,000 employees at VW financial services unit, according to a statement released by the carmaker.
The pay agreement also provides for the hiring of 3,000 temporary workers and taking on an additional 175 trainees annually. Hartmut Meine, chief negotiator for IG Metall, described the deal as a very good and acceptable compromise.
The new pay agreement, which was reached after all-night negotiations, echoes a salary agreement inked between IG Metall and employers on May 19, 2012 for around 3.6 million engineering workers across Germany.
The deal for engineering workers affects all companies including Daimler and BMW. Martin Rosik, chief negotiator for VW, said the size of the pay increase will not reduce pressure on VW, which is facing some serious effects caused by slackening European economies as well as volatile financial markets.