AUDI AG Reaches Agreement with Workers

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March 8, 2005

Source: Audi Communication Corporate & Finance

  • Workplaces safeguarded until 2011
  • Increased flexibility of working hours
  • Extended profit-sharing for all employees
  • Training at a high level

    The Board of Management and the General Works Council of AUDI AG have, with the cooperation of collective agreement parties IG Metall Bayern and IG Metall Baden-Württemberg, agreed upon the contents of the new agreement entitled “The Audi future – achievement, success, profit-sharing”. The agreement was signed today in Ingolstadt. It rules out the possibility of any redundancies caused for operational reasons among the 45,000-strong workforce at the Ingolstadt and Neckarsulm sites before the year 2011. “This agreement marks a clear commitment to the German sites”, said Dr. Horst Neumann, Board Member for Human Resources at AUDI AG. “Our ultimate goal is to unite competitiveness and the safeguarding of jobs. Crucial components of this goal are flexible working hours, cost reductions and a high level of employee competence and commitment.”

    Xaver Meier, Chairman of the General Works Council of AUDI AG, noted, “We entered the negotiations in order to safeguard our workplaces for the future. The guarantee that the full capacities of the Ingolstadt and Neckarsulm sites will be utilised has allowed us to achieve an important goal, indeed for the next six years.”

    A system of “production rotation” will be set up between the Ingolstadt and Neckarsulm plants. “This will make it possible for the two sites to be utilised more equally”, explained Norbert Rank, Deputy Chairman of the General Works Council of AUDI AG and Chairman of the Works Council at the Neckarsulm plant.

    The parties involved in the negotiations agreed to establish separate wage- and salary-related provisions for working hours and remuneration for those employees with positions closely tied to industry, for example catering, office services, security services, infrastructure and building services and mobility services, in order to make employment in these areas more competitive than external service providers. Working hours in these sectors will be increased gradually from the current level of 35 hours to 37 hours by 2006. “As a result, the employees will continue to be employed by AUDI AG with the Audi guarantee of safe jobs”, emphasised Werner Neugebauer, Regional Manager of IG Metall Bayern.

    Increasing the flexibility of working hours is a further factor in increasing competitiveness and safeguarding jobs. Flexi-shifts in conjunction with open time accounts will be introduced, which under specific conditions will replace bonuses with time credit.

    Another issue in the negotiations upon which the parties agreed was the introduction of the Collective Wage Agreement (CWA). From 2007 onwards, the CWA will define a new Audi wage and salary structure. It lies above the region-wide wage agreement. “The CWA conditions at Audi afford greater transparency in career development and new remuneration opportunities for the workforce. Payment risks relating to the introduction of the CWA for current Audi employees have been ruled out”, stressed Jörg Hofmann, Regional Manager of IG Metall Baden-Württemberg.

    On 1st January 2006, remuneration for all employees will be reduced by 2.79 per cent, but the one-off ERA payments due at the same time will mean that employees will not lose any income. The restructured Audi remuneration system will help to significantly reduce the pressure on costs at the company.

    It is intended that the Audi workforce’s hard work will prove worthwhile in the coming years. Further variabilisation of annual wages and salaries was agreed upon for the new Audi remuneration system: the current employee profit-sharing system will be supplemented by a performance-related component. Ten per cent of the future profit increase will be paid to the workforce.

    Professional training forms a further significant component of the agreement. At the beginning of the 2004 training year, Audi employed 40 per cent more apprentices than it did four years previously – a new record. What’s more, Audi has increased not only the number of trainee places but also their quality. “The General Works Council pledged its support for furthering the current qualitative and quantitative level of training. This is because Audi must continue to offer a broad range of high-quality, useful and therefore promising training opportunities,” explained Meier.

    The increased number of apprenticeships applies up to and including the September 2008 intake. The goal shared by the parties in the agreement is to maintain the number of apprenticeships available beyond this date as well. Neumann reported that, in the future, the high number of people completing apprenticeships would, however, require increased flexibility as far as career entry was concerned. “This necessity can be turned to our advantage. The years spent in training should, as was previously the case for journeymen, also serve to qualify and to extend the apprentice’s horizons.” As a result, an employee’s first years in a position will henceforth include placements internally, in other Audi plants and also externally.

    Health and fitness are prerequisites for the effectiveness of the workforce. The high level of health of 97 per cent that has already been achieved is to be maintained and further consolidated. During the coming years, a core element in terms of increasing health and fitness will be the “Audi check-up”. Step-by-step and depending on age, the entire workforce will – on a voluntary basis – be included in a diagnosis and prevention programme based on the very latest medical knowledge.

    Further components in the agreement are increasing equal opportunities and the compatibility of working and private life. “For us, equal opportunities means that women are given the same opportunities during training and in their professional lives as their male colleagues”, said Neumann. A further goal is intensive personnel development for all staff, particularly those who are waged.

    The framework conditions of group work which have been a fixed component of the Audi production system for the last twelve years are to be further improved. Measures for achieving this are management training, the integration of members of the workforce who are older, severely disabled or who have learning difficulties, the interlinking of the ideas programme and group discussions and, not least, the further development of the group discussion as an instrument of the continuous improvement process.

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