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August 14, 2020

Short-time Germany working “not infinite” – ZF CEO

ZF says short-time working backing from Federal German sources is not "infinite."

By Rhodri Morgan

ZF says short-time working backing from Federal German sources is not “infinite.”

Many countries have taken on large percentages of employee salaries in a bid to stave off significant redundancies, but administrations are now starting to mull how they exit the various schemes, without causing major unemployment in the light of the pandemic.

Germany has a Federal Government Agency, an account into which everybody pays and which equates to an insurance policy. It comprises 60% of regular income if workers have no family, rising to 67% if there is a family with children. ZF has extended this arrangment to all locations in Germany and even further to between 80% and 90%.

“For the time being it [short-time working] is possible until next year,” ZF CEO, Wolf-Henning Scheider told just-auto at the supplier’s recent half-year presentation. “It is not infinite, that is clear. There have been talks to further continue it next year.

“This is why our agreement for the transformation [collective deal]… is so important so we have a means to compensate for that.”

In Germany, ZF has concluded a Transformation Collective Agreement with works councils and unions for the purpose. It stipulates ZF will not make any compulsory redundancies or close any sites in Germany until the end of 2022.

In return, the company can reduce employees’ working hours covered by collective bargaining agreements by up to 20% and offer targeted severance packages as well as part-time work for older employees in Germany. Since mid-2019, ZF has reduced its global workforce by 5,300, including 3,800 from the beginning of this year.

When restarting its operations, ZF developed and established extensive protective measures to help ensure the safety of its employees. “We have made extraordinary efforts to maintain the supply chain,” emphasised Scheider.

ZF’s IT teams enabled more than 60,000 employees worldwide at short notice to work remotely by providing infrastructure and programmes for digital collaboration.

At the same time, the software for ZF’s entire digital communication and collaboration was moved to the cloud to adapt performance and availability to the new way of working. The company also made online training courses available.

ZF added many of its employees would like to continue remote work and the virtual work environment in the long term. Since both job satisfaction and productivity have increased through greater flexibility, maintains the supplier, the company plans to introduce a remote work scheme adapted to regional requirements.

ZF recently announced a further step in the company’s transformation towards e-mobility. On 1 January, 2021, a new division will be formed from the current Car Powertrain Technology and E-Mobility divisions to offer customers electrified driveline solutions from a single source.

In the future, ZF will not invest in transmissions exclusively designed for internal combustion engine vehicles, but will focus its development activities on flexible platform technologies for long-range plug-in hybrids and purely electric vehicles.

There is as yet, no name for the new division with ZF noting it still had some time for that process to happen.

“We have some time left to clarify that and give the baby a name,” the ZF CEO added to just-auto.

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