Brazilian Union Workers Take Up to 50% Pay Cut to Keep Their Jobs

Volkswagen Metalworkers from Brazil belonging to unions from the country's powerhouse, São Paulo state, have agreed to salary and working hours cuts in an attempt to save 16.300 jobs, according to Brazilian industry sources.

The agreements involve the São Paulo metal workers union and Mogi das Cruzes, one of the strongest groups in the Brazilian auto industry, which has seen exports and domestic sales slashed dramatically.

The 24 agreements signed contemplate a 20% reduction in working hours and salary cuts ranging between 10 and 17%. Two of the agreements refer to auto parts companies Inebras and Basso Componentes which will freeze job contracts for five months.

However all agreements include a job stability clause ranging from 45 to 180 days.

"Companies must give evidence of their real difficulties and the fall in production," said Miguel Torres, president of the metalworkers union.

This union represents auto assembly plant workers, auto parts and related equipment manufacturers as well as spare suppliers.

The Brazilian auto industry together with the electrical and electronic sectors have been the hardest hit by the global slowdown and concentrate the largest number of job cuts and unemployment insurances, according to the Brazil's National Workers Union..

Further south in Caxias do Sul in the state of Rio Grande do Sul, 30% of the region's 47.000 metal industry workers have also reached similar working hours and salary reductions agreements.

This covers 14.700 workers and 18 corporations which represent 75% of the auto and heavy equipment industry in the state.

However conditions agreed are tougher: job stability in exchange for up to 50% salary cuts and one working day less a week, revealed the Caxias do Sul Metal Industries union.

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