Chrysler 2004 Annual Report Download - page 27

the Chief Executive Officers of the individual Sectors held
meetings with representatives of their employees.
With regard to collective bargaining involving compensation
issues, the agreements reached with the unions call for wage
increases that are generally in line with the rate of inflation.
Increases in excess of the rate of inflation were granted by
companies with favorable operating results or in special
situations.
In Italy, employees received the wage increases provided
for under the National Collective Labor Agreement for
Metalworking Employees (office and factory staff). This
Agreement, which was renewed in May 2003, called for an
average wage increase of 2.5% in 2004. The provisions of the
Agreement regarding employee compensation expired at the
end of 2004. On January 14, 2005, the unions submitted to
Federmeccanica (a national organization that represents Italian
metalworking businesses) their wage increase requests for 2005
and 2006. The procedures for the renewal of the Collective
Labor Agreement require the unions to abstain from wage-
related strikes for a period of four months after they submit
their requests in order to allow negotiations to proceed.
Group employees were also awarded the Annual Performance
Bonus. Under the Group-wide Agreement of 1996, which
is still in force, the bonus was computed on the basis of
indicators of the Group’s overall performance, provided
by the 2003 Consolidated Financial Statements, and quality
indicators for the individual Sectors.
Outside Italy, the main labor agreements included
the renewal of the Collective Labor Agreement for
Metalworking Employees in Germany (following the signing
of an agreement for the region of Baden Württemberg in
February 2004, which set terms that were used as a
reference point for the agreement signed in other German
regions), which provided increases of 2.2% in 2004 and 2.7%
in 2005. This agreement also introduced greater flexibility
for employers, enabling them to increase average weekly
work hours when special production needs require it.
In France, most Group companies carried out their annual
labor negotiations, granting employees wage increases that
averaged between 1.5% and 2%. In Poland as well, the
majority of Group companies reached wage agreements
with the unions, granting average raises of about 3%. In
Brazil, wage-related agreements provided employees with
increases that were in line with those granted by other large
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Human Resources