Volkswagen Quits Labor Agreement, Paving Way for Job Cuts

Published On Sep 10, 2024, 11:50 AM

Volkswagen has decided to discontinue a labor agreement that protected around 120,000 workers from layoffs, a move announced shortly after the company considered closing some of its factories in Germany due to decreasing sales and rising costs. The company aims to cut costs in Germany to remain competitive and invest in new technologies. The existing job security agreements, in place since 1994, offered protection until 2029 but can be severed with a three-month notice, which Volkswagen has initiated. While layoffs could start by June 2025, the agreement remains valid until the end of the year.