Schaeffler Signs Employment Security Agreement With Union

The Schaeffler Group and Germany’s IG Metall trade union have reached an agreement regarding employment security. The agreement, signed by IG Metall first chairman Berthold Huber and Schaeffler chief executive Jürgen Geißinger, represents the first practical result of the future agreement between the two parties outlined on February 23, 2009.

According to the terms of the agreement, the threat of redundancies occurring before June 30, 2010 has been eliminated on the proviso that a jointly agreed upon package of staff cost reduction measures are reached. Due to the impact of the economic crisis and its resultant diminished orders and sales, the Schaeffler Group says it must lower staff costs by approximately 250 million euros. The aforementioned package of measures stipulates that costs must be lowered at the company’s various locations by means of reduced working hours and adjustments to wages and salaries. The government supported practice of “kurzarbeit” (partially subsidised reduced employee working hours) will be extended, and the need to instigate compulsory redundancies will be avoided through voluntary termination agreements, the semi-retirement of older employees and a curtailment of one-off payments. A number of organisations dedicated to help employees find new employment will also be established.

“This agreement is the concrete result of intensive and constructive negotiations between all involved parties, with the objective of achieving essential cost reductions in 2009 without layoffs,” said Schaeffler Group chief executive Jürgen Geißinger.

IG Metall first chairman Berthold Huber added: “We win time with this agreement. It is the correct answer to the serious economic downturn that has particularly affected the metal industry. With this job security agreement the Schaeffler family has demonstrated their adherence to the future agreement signed with IG Metall three months ago.”

Schaeffler general works council chairman Norbert Lenhard views the job security agreement as an important guarantee for the future affiliation with Continental. “Our colleagues now have more security and can continue to concentrate upon their important work. Further good news is that apprentices will be taken on.”

In the meantime, IG Metall and the Schaeffler Group have also given notice regarding the establishment of a Joint Supervisory Board. A board consisting equally of representatives from the company and employees is to be founded. Specific details are yet to be decided upon. Details on the implementation of a Schaeffler Group employment equity investment are also as yet undecided.