Business News

Agreement reached with ver.di as part of restructuring of schlott gruppe AG

Wednesday 08. July 2009 - Conclusion of negotiations with collective bargaining committee of Group works council and ver.di for the purpose of securing the future of schlott gruppe AG; Signing and adoption of joint key issues paper on personnel measures at German operating sites

After a protracted and at times heated round of discussions headed by Dr. Klaus von Dohnanyi as the chosen mediator, the Management Board of schlott gruppe AG, the collective bargaining committee of the Group works council and representatives of ver.di finally concluded their negotiations on Friday, 26 June 2009 and signed a joint key issues paper with regard to personnel measures planned by the company. The outcome of a vote conducted until 3 July 2009 among staff at the respective operational units was significantly in favour of the key issues paper, as a result of which the measures can now be implemented at an operating level.
The key issues paper sets out the necessary measures agreed individually for the various operational units. The extensive restructuring programme, together with the associated personnel measures, had been prompted by the challenges facing schlott gruppe AG in a business climate already adversely affected by excess capacities within the printing sector and, more so, a further decline in demand since the beginning of the year. This situation had had a negative impact on both capacity utilisation and earnings, as detailed by the company in its report on the first half ended 31 March 2009.
As a result, schlott gruppe AG will reduce its installed machine capacities in gravure printing by around 20 per cent. This will coincide with significant downsizing in the area of personnel costs.
The measures agreed by the parties involved relate equally to sites governed by collective wage agreements and those not bound by such contractual provisions. Among other aspects, they include regulations on HR streamlining, the elimination of special gratuities governed by collective bargaining agreements, retention of jobs as well as contributions to be made by the Management Board and staff whose contracts are not regulated by collective wage agreements. The agreement remains in place until 30 September 2012.
The principal measures are as follows:
Job downsizing
Up to 120 redundancies (termination of contracts due to operational requirements) will be made at broschek tiefdruck in Hamburg. Within this context, additional financial incentives have been agreed for up to 45 employees prepared to leave the company on a voluntary basis.
Additionally, the company will introduce a four-shift system with a reduction in working time to 31.875 hours per week and a corresponding reduction in wages.
Up to 30 redundancies (termination of contracts due to operational requirements) will be made at broschek service in Hamburg. Special financial incentives will be available for up to 40 employees who decide to terminate their contracts on a voluntary basis. The remaining activities of broschek service will be relocated to Hamburg.
Key points concerning the reconciliation of interests and a social compensation plan for staff leaving the company have been agreed for both sites. The redundancy notices will be issued effective from 30 September 2009.
Elimination of gratuities governed by collective wage agreements
From 1 July 2009 to 30 September 2012, fifty per cent of special gratuities paid under collective wage agreements will be scrapped at the sites of schlott GmbH in Freudenstadt, at u.e. sebald in Nuremberg and at wwk in Landau respectively. This contribution to consolidation will either not apply at all to those staff members at the afore-mentioned sites whose special gratuities have already been reduced or whose working hours have been cut, or will not apply to the full extent in the first year of implementation. In the case of u.e. sebald, an agreement has been reached to reduce permanently to the collective level the so-called reporting-for-duty allowance payable for work on Sundays and public holidays.
The aim with regard to those companies not governed by collective bargaining agreements (dvn, broschek rollenoffset, schlott vertrieb, sebaldus and schlott gruppe AG) is to scale back annual remuneration by 5.8 per cent for 2009 and by 5.5 per cent in the subsequent years.
Retention of jobs
Measures aimed at safeguarding jobs at companies governed by collective bargaining arrangements are determined on the basis of provisions set out in the applicable collective agreements. If staff forego pay on a voluntary basis, the job retention clause applicable under the collective bargaining agreements will also apply to those entities not governed by such collective arrangements. In the case of broschek service, job retention has been promised for remaining employees for the entire term of the agreement.
Contribution by Management Board and other regulations
The Management Board has agreed to forego 6.6 per cent of its annual compensation. Within this context, the aim is to extend this regulation to other management staff and personnel whose contracts are not governed by collective bargaining agreements.
These contributions to consolidation do not apply to apprentices participating in vocational training programmes or staff with pre-retirement part-time work agreements.
The parties involved agreed that further negotiations could be entered into for the purpose of discussing appropriate measures to secure the future of the company if the economic climate were to deteriorate beyond the assumptions made for forecasting purposes.
The Management Board considers the key issues paper and employees’ approval of the provisions set out therein to be an important basis for the sustainable future of schlott gruppe AG. Operating from a solid foundation, the goal is to remain one of Europe’s key service providers within the field of rotary printing.