Catherwood LibraryILR School

Volkswagen and German trade union IG Metall agreed to a 3.2% wage hike and a bonus equal to 1% of worker's pay in a wage deal that is expected to set the standard for other industries. The deal will take effect on May 1, and remain in place for 16 months. Volkswagen had already agreed that they would not layoff any workers before the end of 2014. Both Volkswagen and IG Metall said that they were pleased with the agreement. The union worked with Volkswagen and other manufacturers to keep jobs in place during the recession, and companies are looking for ways to give back while remaining competitive. Analysts say that the deal should not have a large effect on inflation, but that they are keeping an eye on it. IG Metall will negotiate for new wage deals in other industries, including clothing and textile, where it has called for a 5% increase in wages.