BASF SE management and employee representatives today signed a new site agreement for the company’s Ludwigshafen site. The agreement, titled “Safeguarding the future through flexibility and operational partnership,” applies to the approximately 33,000 BASF SE employees at the site for the period from the beginning of 2011 to end of 2015. It replaces the site agreement from end of 2004 which expires at the end of this year.
A no-redundancy pledge is a key element of the agreement. Another is the company's promise to spend €9 to 10 billion on measures to safeguard the site’s future through to the end of 2015. Approximately two-thirds of the amount will be used on investment, modernization and maintenance to keep the Ludwigshafen site performing at its best in terms of technology and organization and thus strengthening core operations. The investment thus remains at the high level of the past years. Research and development expenditure will also be at the level of previous years and will account for more than one-third of the total amount. Ludwigshafen will remain the central platform for global research and development at BASF.
In a bid to meet the challenges posed by increasingly unpredictable fluctuations in market demand, management and employee representatives have agreed on a package of measures to enhance the flexibility of HR systems in the site agreement.
Close and trusting relationship in the economic crisis
“The recent economic crisis highlighted the importance of close and trusting cooperation between the works council and management, which enabled us to avoid short-time work at the Ludwigshafen site for a long time and minimize its impact at a later stage. This was possible because both sides were willing to show flexibility on human resources issues. The new site agreement captures this spirit and ensures that the site is equipped to weather future storms,” said Dr. Harald Schwager, Member of the Board of Executive Directors and Industrial Relations Director of BASF SE.
“We consciously invested a lot of time in these talks and engaged intensely with management in order to achieve workable models. The negotiations were very tough but the shared background of experience in coping with the crisis had a positive impact on the atmosphere of the negotiations. The new site agreement sends out important signals with regards to employment, while at the same time mapping out an effective plan to keep the Ludwigshafen site competitive on an international scale now and in the future,” said Robert Oswald, Chairman of the Works Council of BASF SE.
The Site Agreement highlights continuation of “flexible personnel deployment” as a key flexibilization element. During the economic crisis up to 600 employees from plants with low capacity utilization were deployed for a temporary period in other plants where there was more work to be done. Fluctuations in production capacity utilization could thus be better offset. Both sides have also agreed to a possible increase in the proportion of temporary staff to enhance flexibility even further.
Securing employment on a long-term basis
Another key element of the site agreement is a joint commitment toward safeguarding employment through training, personnel development and qualification, and the Generations@Work program to address demographic change. “ We wholeheartedly are committed to vocational training and intend to maintain the existing high level of vocational training at BASF SE and in the BASF Training Verbund with partner companies. Through this commitment we avoid any risk of a shortage of skilled labor and at the same time meet our responsibilities toward the young people in our region,” said Hans-Carsten Hansen, President Human Resources at BASF SE.
“Longer working lives are posing new challenges in terms of the working capacity of our employees. The agreed expansion of company health management will offer employees more opportunities to stay healthy and increase their fitness for work throughout the later stages of their working lives,” said Rainer Nachtrab, Chair of the Executive Representative Committee of BASF SE.