Cuts at VW: What do employees at Volkswagen earn?

This article first appeared at ntv.de

Volkswagen is expensive at home, so in the opinion of CEO Oliver Blume, costs in Germany must be “significantly reduced”. The car manufacturer, known for its good salaries, wants to take an unusual step: In the current collective bargaining negotiations, the approximately 120,000 local employees are being asked to forego part of their wages – instead of getting a raise as usual.

Salaries in the company collective agreement are to fall by ten percent, and the monthly allowance of almost 170 euros as well as anniversary payments for long-standing employees are to be eliminated – in addition to factory closures and thousands of jobs being cut. The bonuses for specialists and managers should also be adjusted to the other salary groups, i.e. reduced. The IG Metall union is attacking the plans, demanding a seven percent increase in salaries and categorically ruling out a wage cut.

So far, most employees in production earn 3,900 to 4,300 euros gross per month, as the works council announced in response to an inquiry from ntv.de. Bachelor graduates start at 5300 euros, Master graduates at 5600 euros. Masters receive a good 5,950 euros, or more if they have more responsibility. Experienced or highly sought-after specialists such as engineers, programmers or quality assurance specialists can earn up to a good 7,700 euros.

Salaries in the VW in-house tariff start at around 2,400 euros; a good 3,500 euros can be earned, for example, in factory security, i.e. at the gates. In all salary levels, there is an additional monthly allowance of almost 170 euros and an annual bonus, with an average of around 4,360 euros in recent years. Most recently, the annual bonus payment, which replaces vacation and Christmas bonuses, was more than 4,730 euros.

With a typical worker’s salary of around 4,100 euros, the gross annual total was around 56,000 euros. Spread over twelve months, that would be just under 4,670 euros. There are also surcharges for night and Sunday work. The regular working hours are 35 hours per week. In addition to 30 days of vacation for a full-time position, employees receive six days off.

For comparison with other employers: According to the Federal Statistical Office, the average gross salary of full-time employees across all sectors last year was just under 4,500 euros. According to calculations by the job portal Stepstone, the so-called median salary was 3,650 euros – so half earned more, half earned less.

Specialists and managers below non-tariff management at VW, such as a company doctor or the head of a sub-department, are paid according to their own collective agreement and earn more than 8,000 euros, sometimes over 9,000 euros. There is also a separate collective agreement for temporary workers, but this has been terminated. So far, VW says it has paid far more than the competition. In the future, the conditions should be based on the rest of the industry.

The next hearing will be on November 21st. It shouldn’t be the last time: after the last meeting, works council boss Daniela Cavallo spoke of a “marathon” that has only just begun. The in-house tariff applies to the plants in Wolfsburg, Braunschweig, Hanover, Salzgitter, Emden and Kassel as well as VW Financial Services and Volkswagen Immobilien. The VW plant in Osnabrück is not included, the three Saxon locations only from 2027.

Last year – his first full year at the helm – CEO Blume moved into the top group of the highest-paid DAX CEOs, as the Reuters news agency reported. According to the annual report, including pension contributions, his remuneration amounted to 9.71 million euros. Because Blume continues to run the listed subsidiary Porsche, both companies share his salary.

The board of directors also wants to save on itself. The board members announced in the spring that they would reduce their fixed salaries by five percent. Blume’s fixed salary as VW boss last year was 1.3 million euros, so if his remuneration remained the same he would forego 65,000 euros – from a good 8.7 million euros without pension provisions. Human resources director Gunnar Kilian earned almost 5.6 million euros during the period.