BASF revamps employee bonus, share schemes

27 November 2001 18:41  [Source: ICIS news]

LONDON (CNI)--German chemical giant BASF has reached agreements with employees at its Ludwigshafen, Germany site on a new remuneration system with bonuses based on the company's financial performance.

A spokeswoman told CNI on Tuesday that the voluntary annual bonus for blue collar as well as office workers will now be based on the company's return on assets (ROA). The BASF board will make a final decision on size of the bonus in spring (March-May) 2002, based on its full year earnings.

Managers at Ludwigshafen will receive a performance-related bonus. The size of this bonus will be based solely on the company's ROA, said BASF, adding that a bigger proportion of this bonus may be given out through pension schemes.

BASF said that all employees will become shareholders in the company. Under the Double plus programme, employees will receive 10 additional shares, instead of five, for the first package of 10 shares they purchase each year. Furthermore, all permanent employees will receive a one-off package of five free shares in May 2002 under the Start plus programme.

Eggert Voscherau, industrial relations director of BASF, said: "In this way we reward employees fairly and comprehensibly for the success of the company, foster entrepreneurship and have thus taken an important step in shaping the future of the Ludwigshafen site."

Robert Oswald, chairman of BASF's Works Council, said: "The results are a major success in a difficult economic climate and set the right signals for BASF's workforce."

BASF revealed earlier this month that it is to shut temporarily next month some 60 plants in Ludwigshafen plus others in Europe and the US, including Antwerp, due to weak demand. The spokeswoman said that the new rewards system is not related to the shutdowns, declining to identify which plants would be affected.

By: Russell Ong
+44 208 652 3214

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