VW mulls cutting temporary workers – Automaker hires anti-corruption exec as it deals with scandal

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BERLIN, Oct 17, (Agencies): Volkswagen is considering a reduction in temporary workers as part of efforts to offset the cost of the emissions scandal, the car maker’s works council said on Saturday.

A spokesman for the council, a grouping of labour representatives within the company, said it would support efforts to secure temporary jobs but was aware the company’s board was discussing “different scenarios”.

Volkswagen said in a statement that the outlook for its sales and employment levels were unpredictable, having on Friday reported lower September deliveries for its core autos division and the 12-brand group as a whole.

“If employment declines temporarily, shortened working hours will be a reasonable option,” VW said, adding that the executive board was doing everything it could to secure jobs.

Reeling from the scandal over its rigging of diesel emissions, Volkswagen has said it will cut investment plans at its biggest division by 1 billion euros ($1.1 billion) a year.

Some analysts have said the scandal could cost Volkswagen as much as 35 billion euros ($40 billion) to cover vehicle refits, regulatory fines and lawsuits.

Citing unnamed government sources, daily Bild reported Chancellor Angela Merkel’s office is looking into whether 6,000 Volkswagen temporary workers could be moved on to the government’s “Kurzarbeit” short-time work programme.

The scheme allows companies to preserve jobs by reducing employees’ hours when plant usage is low, with the government compensating workers for part of their lost wages.

The Federal Labour Office has ruled out the idea, already floated by Economy Minister Sigmar Gabriel, of including temporary workers in the plan, from which they would normally be excluded. But Berlin wants to be prepared for cost cuts at Volkswagen.

A government spokesman could not immediately be reached for comment.

Works council head Bernd Osterloh had said earlier this month it was not yet clear whether the emissions scandal would affect jobs over the medium to longer term. “At this point, there are no consequences for jobs, neither for core workers nor for temporary staff.”

Meanwhile, Automaker Volkswagen is hiring a top anti-corruption manager from competitor Daimler as it struggles to clean up a scandal over cheating on US diesel emissions tests.

The company said Friday it would hire lawyer Christine Hohmann-Dennhardt as an executive on the company’s top management body tasked with integrity and legal affairs effective from Jan. 1.

Before working for Daimler, Hohmann-Dennhardt, 65, served as a judge on Germany’s Federal Constitutional Court and as justice minister in the state of Hesse in southwestern Germany.

Daimler said it was agreeing to release her from her contract as compliance executive in the interests of good corporate governance.

Naming a compliance executive was a step taken by Daimler AG and German industrial equipment maker Siemens after bribery scandals at those companies. The idea is to put someone responsible for clean business practices at the very top level of management. German corporations are run by a management board comprised of the top executives such as the CEO and chief financial officer.

US officials say Volkswagen AG programmed diesel engines on 482,000 cars to disable emission controls when the vehicles were not being tested. The company is recalling in Germany 2.4 million 2009-2015 model year cars with the deceptive software and 8.5 million in total across Europe.

German prosecutors investigating Volkswagen’s use of the software said Friday they’re putting together a special team of detectives to evaluate the massive amount of data seized from the car manufacturer.

Braunschweig prosecutors’ spokesman Klaus Ziehe said state police are putting together a group of about 20 investigators to work with his office. Ziehe’s office last week searched VW headquarters in Wolfsburg as part of its probe to determine who was responsible for suspected fraud.

“We’re talking terabytes, not gigabytes, and certainly many cartons of paper,” said Ziehe. A terabyte, a unit of digital information, is about 1,000 gigabytes.

Ziehe confirmed that the number of suspects is indeed “more than two but at the moment a lot fewer than 10.”

“Where they’re from, what areas they worked in and at what level, we’re not saying, but that’s the number of accused we have. That can change,” he said.

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