GERMANY: Porsche not negotiatiating with VW workers

By just-auto.com editorial team | 15 October 2007

The dispute between the Volkswagen works council and Porsche management over collective bargaining continues.

Porsche's chief executive, Wendelin Wiedeking, told the German news magazine, Focus, that the criteria for representation on the Porsche Automobil Holding supervisory board was not up for discussion. He said that Porsche employees and Volkswagen employees would be equally represented.

The VW works council has complained about the collective bargaining structure included in the structure of Porsche Holding SE. Volkswagen would effectively become part of the new company if Porsche increased its stake in Volkswagen to over 50%, and if this were to happen, the Volkswagen supervisory board, on which Volkswagen employees are fully represented, would become redundant. They have half the places on the board meaning that management has to have their cooperation in major business decisions.

The Porsche supervisory board would have a maximum of three VW employee representatives out of a total of 12 board members. Porsche employees would have the same number of representatives, which the VW works council claims is unfair since Porsche has just 12,000 workers, compared to Volkswagen's 324,000 employees.

A spokesperson for the VW works council told the magazine that the new structure would disempower VW workers. "If decisions made by the board are bad for the 324,000 workers, then we have no way of changing the decision if Porsche workers do not support us," he said.

On 23 October the European Court will give its decision on the VW Law. It is expected to rule the law illegal, paving the way for Porsche to increase its influence over VW management decisions. At the moment all shareholders are limited to a maximum 20% voting rights. Porsche owns over 30% shares in Volkswagen and would seek a similar proportion of voting rights.

On 24 October a Stuttgart labour court will rule on whether the VW works council should have a say in the collective bargaining structure of the new Porsche holding company.