Stuttgart, Germany – Daimler AG has announced measures it will take to reduce labour costs without sacrificing jobs. The package of measures has been agreed upon by company management and its Employee Council, and will be presented to the workforce for approval.

The key points of the agreement are a collective reduction in working time for employees who are not included in short-time working arrangements, a reduction in the allowance paid towards the short-time compensation, and postponement of an upcoming wage-tariff increase by five months. The company said that these measures, and others previously decided upon, will reduce labour costs by €2 billion.

In return, all employees will be protected against termination of employment due to redundancies for the duration of the company-wide agreement, which runs from May 1, 2009 until June 30, 2010, regardless of the date they started employment. Depending on the economic situation, the agreement can be terminated as of December 31, 2009 at the earliest.

“In the present economic situation, there is no alternative to this package of measures,” said Wilfried Porth, Human Resources Director. “A key feature of the package is that all employees will make their own contribution. I am aware, however, that the measures involve painful losses for many of our employees.”

Daimler’s Board of Management and top executives will do without a part of their monthly basic salaries for a limited period, starting in May. The usual annual increase in monthly salaries will also be omitted this year.

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