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Unions Wary of Executive Pay Cut Offer

Trade union leaders on Monday had a mixed reaction to an offer by DaimlerChrysler executives to take a pay cut if workers agree to do the same. Negotiations are expected to resume on Tuesday.


DaimlerChrysler CEO Schrempp could get by with a little less

Members of DaimlerChrysler's workers' council meanwhile also criticized the company leadership, saying executives were responsible for the need to cut costs.

DaimlerChrysler had announced last week that the company would have to save €500 million ($615 million) at its plant in Sindelfingen near Stuttgart or move prodution to Bremen or South Africa, where labor costs are lower. The move would lead to the loss of 6,000 jobs in Sindelfingen.

Thousands of DaimlerChrysler workers have downed tools in a series of work stoppages in recent days to protest against the cost-cutting plans.

Eva von der Weide, a member of the council, said the proposed pay cuts for executives would have to be permanent, just like the ones the company is expecting workers to accept.

But Berthold Huber, the deputy leader of Germany's largest union, IG Metall, said the offer was not helping to solve the problem.

Demonstration bei Daimler in Sindelfingen

An DaimlerChrysler employee's shirt reads "Blackmail Factory" during protests last Thursday.

"I think it's an attempt to fix things cosmetically and pour oil on troubled waters," he said in a radio interview on Monday, adding that the executive pay cuts would amount to a few million euros at best. DaimlerChrysler CEO Jürgen Schrempp received €5.44 million in salary in 2003, up 192 percent from €1.86 million in 1997.

Members of the service sector union, Ver.di, also had harsh words for DaimlerChrysler executives.

"Of all places, Daimler, which has wasted many millions with its adventures in the U.S. and Japan, is now asking workers to make sacrifices," Margret Mönig-Raane, the union's deputy leader, told Berliner Zeitung.

Bavarian Premier Edmund Stoiber on the other hand welcomed the executive pay cut offer and said other managers should follow suit.

"I think it's important for social symmetry," Stoiber said on Monday, adding that it was unbearable that people would lose their jobs while executives received pay increases.

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