Fiat Chrysler Signs Four-Year Labour Deal in Italy

Published By : 09 Jul 2015 | Published By : QYRESEARCH

In an attempt to improve its relations with the unions, auto manufacturer Fiat Chrysler Automobiles (FCA) along with CNH Industrial signed a labour deal for workers in Italy. The agreement for the duration between 2015 and 2018 applies to around 85,000 employees of both the companies. The agreement also includes a performance-based compensation scheme related to the achievement of certain profitability and efficiency targets. If an employee meets the targets, he or she will be entitled to a bonus worth 7000 to 10,700 euros over four years. Earlier this year, this scheme was introduced at FCA’s car manufacturing operations and has now been extended to other verticals such as component-making subsidiaries as well as to CNH Industrial. 

Sergio Marchionne, FCA’s Chief Executive and the Chairman at CNH Industrial, had earlier asked the unions to accept the tougher regulations on sick pay, working hours, and strikes to let the Italian automotive plants to compete with their rivals abroad. He had also taken Fiat out of the Italian employers’ confederation Confindustria. The move made Fiat no longer bounded by the collective labour rules which were decided by the unions and the confederation. Marchionne was criticized by the unions but later on, the company’s investments in plants and new models gave positive hope to the unions with creation of new jobs. 

Both FCA and CNH Industrial have the same labour agreement. CNH Industrial is being seen as the sister company of FCA after its creation through the merger of Fiat Industrial and CNH Global. Labour unions in Italy have welcomed the agreement, saying that the performance-based compensation scheme would boost the auto sector in Europe.  However, FIOM union which has argued with Fiat in the past over working conditions and pay in the plants, did not participate in this deal. 
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