IG Metall collective bargaining committee confirms negotiation results for ThyssenKrupp Steel Europe AG – Basis created for reconciliation of interests negotiated by Executive Board and General Works Council

thyssenkruppTo concretize the personnel measures under the “Best-in-Class Reloaded” optimization program, the Executive Board and General Works Council of ThyssenKrupp Steel Europe AG have negotiated a reconciliation of interests, the basis for which was confirmed on September 18th by the collective bargaining committee of trade union IG Metall. As a supplement to this company agreement on securing employment, the negotiated reconciliation of interests regulates the socially acceptable implementation of the necessary adjustments; there will be no compulsory redundancies. The employee and employer sides believe that the agreement now reached will contribute significantly to maintaining competitiveness and safeguarding jobs at ThyssenKrupp Steel Europe over the long term despite the extremely difficult situation in the steel industry.

With this reconciliation of interests both parties have taken a new approach. Instead of pensioning off older employees, the aim is to keep as many employees and their expertise in the company as possible. This is to be achieved among other things by a temporary reduction in the working hours of pay-scale employees – from 34 to 31 hours a week. At the same time the adjustments are to be spread over as many shoulders as possible, so that all employees will make a contribution under these arrangements. Altogether the measures will significantly reduce costs at ThyssenKrupp Steel Europe.
The following key points were negotiated:

– From October 1, 2014, the weekly working hours of pay-scale employees will be reduced to 31 hours. Beginning on October 1, 2018, the working week will be increased again step by step – to 35 hours in the 2020/21 fiscal year.

– From October 1, 2014 non-pay-scale employees will be involved in the cost savings for a period of five years in the form of the loss of six days’ leave or a 2.44 percent reduction in monthly salary.

– The executive employees will make an appropriate contribution to the cost savings.

– ThyssenKrupp Steel Europe will continue to meet its social responsibility to train young people in the region and will maintain its current level of apprenticeship training. In view of the lack of vacancies and acute employment problems it will not be possible over the next few years to retain apprentices after they complete their training. For a year after training they will therefore be taken on and employed by PEAG Personal GmbH so that they can gain work experience. The aim is to place the young people in permanent employment during this time. This arrangement applies to apprenticeships ending in summer 2013 to summer 2018.

– In addition, there is the possibility of using partial retirement contracts within the collectively agreed scope. This applies to employees who are eligible for pension after a maximum of six years in partial retirement and whose job ceases to exist.

– As in the past, where relocations place a financial strain on employees this will be cushioned with the help of a social plan. Among other things this covers pay protection, training, travel expense allowances and the reimbursement of removal costs. Employees will also be offered severance payments under the social plan. Increased efforts will be made to promote the use of part-time employment.

In total this corresponds to a reduction of up to 1,300 employees; the actual personnel reduction will be achieved over time through non-replacement of employees entering retirement. If steel demand rises again, the parties can respond quickly and increase working hours at ThyssenKrupp Steel Europe again earlier than planned.
In view of the challenges posed by the fiercely competitive steel market, the aim of the negotiations was to take a new approach. “We haven’t cut jobs across the board, as in the past. On the contrary: By making flexible use of the socially acceptable instruments available, we can retain employee potential and expertise in the company to a very large extent,” says Thomas Schlenz, CHRO at ThyssenKrupp Steel Europe AG. “All employees are only too aware how critical the situation in the steel industry is. That’s why everyone is doing their bit to reduce costs and safeguard the potential of the experienced and motivated employees at ThyssenKrupp Steel Europe over the long term,” says Schlenz.
“The negotiations were extremely difficult,” says General Works Council Chairman Günter Back. “It will hurt the pockets of many of our colleagues. That’s why it was important to put a time limit on some of the measures. In addition we will be able to respond when the market picks up again.” Of particular importance to the employee representatives were the results achieved for the apprentices. “We have a duty to the future of our young people, which we must not gamble away,” says Back.