IG Metall is demanding a five percent pay raise for VW employees

IG Metall is demanding a five percent pay increase for Volkswagen employees. The union announced that the bargaining committee had unanimously approved the demand. The raise is also to apply to apprentices. In addition, IG Metall is calling for a social component to benefit lower pay grades. The agreement is set to run for twelve months.

According to the union, the company-wide collective bargaining agreement applies to approximately 130,000 VW employees in Braunschweig, Chemnitz, Dresden, Emden, Hanover, Kassel, Salzgitter, Wolfsburg, and Zwickau. In terms of the number of employees, it is considered one of the largest company collective bargaining agreements in Germany.

Negotiator Calls for Fair Burden-Sharing

Thorsten Gröger, IG Metall district director for Lower Saxony and VW negotiator, stated: “We know that Volkswagen faces major challenges. But the answer to this cannot be to pit employees against the company’s future.” They have already borne significant cuts in recent years. At the same time, Volkswagen has distributed billions to its shareholders. “We need a fair balance between the employees and the responsibilities of the company and its owners,” Gröger said, according to the statement. 

VW Works Council Chair and collective bargaining committee member Daniela Cavallo pointed out that employees covered by the company’s in-house collective bargaining agreement last received a raise in May 2024. “Since then, the cost of living has been rising—from grocery prices to gas prices to insurance premiums. This is no different for our colleagues than it is for all other workers.” Now it’s a matter of demanding a fair share.

IG Metall: No negotiation date set yet

With this decision, the bargaining committee is following IG Metall’s demands for the industry-wide collective bargaining agreement in the metal and electrical industries. The in-house collective bargaining agreement at Volkswagen AG was terminated as of December 31. The no-strike clause expires on January 1, after which warning strikes are possible. “Whether these will be necessary will depend on the course of the negotiations,” the union stated. According to IG Metall, no date has yet been set for talks with the company.

Gröger Expects Tough Round of Negotiations

“This round of collective bargaining will be tough, and it is likely to be more contentious than the 2024 dispute,” said Gröger. At that time, IG Metall had brought production to a standstill on several occasions with warning strikes. It wasn’t until shortly before Christmas, following a week-long marathon of negotiations, that a compromise was reached. This compromise called for the elimination of 35,000 jobs in Germany by 2030.

In addition, bonus payments and allowances were cut, and wage increases were put on hold. In return, VW has agreed to avoid layoffs for operational reasons and plant closures—and has committed to investments and products for German plants. The union views these agreements as being at risk in light of new cost-cutting plans. Therefore, the union also wants to discuss the locations here in Germany: “For us, the collective bargaining round also includes the question of what industrial prospects all plants have beyond 2030,” said Gröger. The goal is binding prospects

Tens of thousands of jobs at risk

The industry crisis is currently hitting Europe’s largest automaker hard: To become more robust and competitive, the Group Executive Board plans to cut another 50,000 jobs worldwide in the coming years. About half of these will be in Germany. It is not yet publicly known how many of these jobs will be cut directly at Volkswagen—as opposed to at other subsidiary brands. In any case, the plans must first be negotiated with the employees. Furthermore, the future of the VW plants in Emden, Hanover, and Zwickau, as well as the Audi site in Neckarsulm, remains uncertain.