April 11, 2018 / 5:45 PM / 2 years ago

Skoda Auto agrees 12 percent wage hike, averting strike threat

FILE PHOTO: A Skoda logo is pictured during the second media day of the 86th International Motor Show in Geneva, Switzerland, March 2, 2016. REUTERS/Denis Balibouse

PRAGUE (Reuters) - Czech Volkswagen (VOWG_p.DE) unit Skoda Auto said on Wednesday it had reached an agreement with unions to raise wage tariffs by 12 percent, averting the threat of a strike.

Skoda is the largest Czech company and the biggest exporter, and wages there help set example for other wage talks.

“The exceptionally high result reflects the competitive situation in the country as well as the overall macroeconomic situation in the Czech Republic,” Chairman Bernhard Maier said in a statement.

“It is an agreement concluded...with respect to social and economic convergence with mainly the European 28, and in comparison with the high wage growth in neighbouring countries and the Czech Republic itself.”

The Czech economy has been growing strongly, pushing unemployment to long-term lows, creating labour shortages and sparking fast wage growth.

The company said that the average monthly wage at the firm was 45,385 Czech crowns last year.

It said the agreement, signed for one year, also meant that workers who qualify for full bonuses would get an average annual bonus of 110,000 crowns.

Reporting by Jan Lopatka

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