FRANKFURT (Reuters) - Opel’s works council has halted a voluntary buyout plan at the lossmaking German carmaker, crimping parent company PSA Group’s (PEUP.PA) ability to pursue deeper staff cuts, internal memos seen by Reuters on Friday showed.
PSA Group, which bought Opel from General Motors (GM.N) for $2.6 billion (2 billion pounds) last year, aims to cut about 3,700 of around 19,000 employees in Germany to restore profitability by 2020 after two decades of losses.
The French carmaker had agreed to avoid forced redundancies and pledged to work with Opel’s labour representatives on a voluntary buyout programme, but that was halted earlier this week.
“The works council has demanded that management suspend the voluntary buyout plan, in particular for the Ruesselsheim, Kaiserslautern and Eisenach plants,” a memo sent to Opel workers by the company’s labour representatives, showed.
The works council said it disagrees with Opel management’s plan to continue buyouts because so many employees had already agreed to early retirement and part-time work, and because targets for job cuts at plants like Kaiserslautern had already been met or exceeded.
“Why does management want to cut more personnel than what has been communicated to authorities and towards IG Metall,” the works council memo, which was sent to workers on Thursday, said.
Tensions have mounted since Opel’s German workers rejected demands to waive a 4.3 percent pay increase in return for PSA’s commitment to assign a new model for production to the Opel plant in Eisenach, leading to a standoff with management.
Opel’s management sent a separate memo on Friday which informed workers that around 1,000 staff had applied for the voluntary redundancies package.
“However, employees are being blocked by the Works Council, which has informed management that it will not approve the contracts until further notice. This is a clear violation of the collective agreement on the voluntary programme,” the management memo said.
A spokesman for Opel and a spokeswoman for the works council declined to comment on internal company messages. PSA Group also declined to comment, deferring to Opel.
Reporting by Edward Taylor and Jan Schwartz, additional reporting by Laurence Frost; Editing by Elaine Hardcastle