The board of directors of Mlada Boleslav-based Skoda Auto approved a pay raise proposed by mediator Ivan Fisera Feb. 14. The compromise sets an average monthly raise of 5.2 percent, or 1,050 Kc ($36). If agreed to by the company's labor unions, the raise will be effective from April 1 of this year until March 2004 and will be retroactive to January. The current average monthly wage of a Skoda Auto employee is just above 20,000 Kc.
The unions will continue in collective bargaining with the company. The next round, the 10th, is scheduled for Feb. 19. “Round No. 10 should bring some more clarity into negotiations,” said union spokesman Jaromir Cvrcek. He refused to comment on the proposal but criticized the way Skoda accepted it, saying that “the company released … incomplete and thus unobjective numbers.”
Company management claims that its main priority is to calm the contentious atmosphere of the negotiations, which are affected by threats from the unions to hold further strikes following walkouts of voluntary night shifts from the beginning of the year. “The mediator's proposal markedly overreaches the company's expectations from the economic point of view,” said board member Helmuth Schuster. The low inflation rate in the Czech Republic and the sluggishness of the passenger car market, the main one for the company, were the key factors behind the company's original proposal, Schuster said.
Initially, management offered a 3 percent pay hike plus other benefits this year, and promised another 3 percent increase for next year. The unions, meanwhile, demanded a 10 percent raise. Failing to reach agreement in several rounds of negotiations since last November, both sides brought in a mediator for the first time in the company's history. Fisera is a professor at the Czech Management Center.
Milan Stech, deputy chairman of the Bohemian-Moravian Confederation of Trade Unions (CMKOS), refused detailed comment on the situation. He did say that “Skoda is a top company whose progress is comparable to companies in the West, and its wage development should correspond with this.”
Skoda Auto is this country's largest carmaker by far, commanding nearly 50 percent of the domestic market in January 2003, according to figures from the Automotive Industry Association (SAP). The company's sales of new passenger cars on the domestic market increased by 9.6 percent year-on-year during that month.