The HR director, Carlos Escobar, for the Volkswagen plant in Navarra was reading the mail as usual in his office that his secretary left him on his desk each morning. On that day, he read the first letter that was from Germany and had the sign of the production manager for all the European Volkswagen (VW) plant, Herbert Waltl.
As he read the letter, he decided to meet the general manager, Patrick Danau, of VW Espana, to evaluate a last minute development: “Patrick, we need to cancel the existing labor agreement and begin negotiations on the new 8th Collective Agreement with the labor unions, as the last one expires within a few months. As the letter, which I received a few hours ago asked me to follow the same labor costs as SEAT. I want to have a deeper look, Patrick; it is not possible to reduce the salaries of employees anymore. What could be the ways to cut the labor costs if we are more expensive? It’s impossible!”
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