After long and difficult negotiations, the collective agreement for this year was signed by both parties in VÍTKOVICE STEEL this morning. The collective agreement effective for the years 2004 – 2006 was signed last year, so the main bargaining was focusing on the financial part of the agreement.

“Probably the most important outcome of the negotiation is the approved growth in wage tariffs by 5.5 percent against 2004. For comparison, in 2004 the growth in wage tariffs against 2003 was 3.5%,” commented the results Jan Polzer, Personnel Director of VÍTKOVICE STEEL. The chairman of the basic union organization of the company, Jan Fromelius, added “We started the collective bargaining at the end of 2004 with the proposal of 8% increase in wage tariffs. And even though the negotiations were very difficult, they were carried in a very decent way. At the end we came to a compromise which is acceptable for both parties.” Extras for work at night increased from 14 CZK to 15 CZK, extras for work in strenuous and harmful environment increased from 7 CZK to 7.50 CZK and gratuities when terminating the employment for the first time upon fulfillment of certain conditions increased from 10 000 CZK to 15 000 CZK. An increase will be given also to people who are entitled to gratuities at the occasion of a life or working anniversary. “One of the novelties is increased severance allowance for self-supporting mothers and employees with impaired health affected by organization changes, which means that they will receive up to 12 wages above the level of the mandatory severance allowance and severance allowance for certain number of years spent with the Company,” added Jan Polzer.

Good news for the employees of this steel company is also an increase in extra bonuses for contributing to a growth of value added, i.e., in the first band up to 3 % by 300 CZK, and in the second and third band – above 3 % and above 5 % - these bonuses will increase by up to 1 000 CZK. “Thanks to these bonuses, in the 3rd quarter of 2004, the employees received in their October salaries more than 6 million crowns, which on average represents 4 000 CZK per person. And despite the fact that we still do not know the results for the 4th quarter, based on the estimated figures we can expect that extra bonuses for this period will be paid to the employees again in the maximum level,” stated Jan Polzer.

With respect to the previous benefits, approximately 1 580 employees of VÍTKOVICE STEEL are still entitled to five weeks of paid leave, contribution for catering and pension rider – both these contributions were increased in the middle of the last year. Average salary in this company in 2004 was approximately 21 680 crowns.