Original URL: http://www.theregister.co.uk/2006/10/02/pay_rises/
Siemens creates hardship fund for BenQ workers
Cancelling pay rises
Siemens' board voted this weekend to forgo a planned 30 per cent pay rise in order to set up a €30m hardship fund for workers affected by the closure of the German handset business it offloaded to BenQ last year.
Siemens boss Klaus Kleinfeld said that after an extraordinary meeting on Sunday, the board wanted to "show solidarity" with the affected workers.
"We think the way BenQ has acted in Germany is unacceptable and want to help where we can," Kleinfeld told Bild. "If BenQ is going to leave employees in the lurch, then we want to help actively and quickly."
Taiwanese firm BenQ acquired Siemens' loss-making handset unit last year. In exchange, Siemens agreed to invest in BenQ by buying shares.
Under the terms of the deal, which saw Siemens effectively paying BenQ to take over operations, BenQ guaranteed jobs at the handset unit until the middle of this year.
In July it announced a 10 per cent reduction in the workforce, and then last week the firm filed for insolvency of the business unit, the first step towards closing the German handset business and shedding its 3,000 workers.
Shortly after the announcement, protesters gathered outside Siemens' HQ to express their dissatisfaction with the situation. Kleinfeld said last week the firm was considering taking legal action against BenQ. ®