Fiat to shed 700 jobs at Serbian factory

By bne IntelliNews July 13, 2016

Fiat Chrysler Automobiles (FCA) Srbija factory in the town of Kragujevac will retain 2,500 of its 3,200 workers following a voluntary redundancy programme, with those who have opted to leave set to receive their redundancy payments on July 28, national broadcaster RTS reported on July 11.

FCA announced on June 14 it has to switch production at the factory in Kragujevac from three shifts to two and start a reduction of the workforce through voluntary departures, due to market demand.

Workers had 12 days to decide whether to take the voluntary severance package offered by the company, and filing had started on June 27 and ended on July 8. The company is now working in only two shifts and produces around 400 vehicles a day, down from the 640 cars a day produced in three shifts.

According to Zoran Markovic, the leader of the Kragujevac-based Independent Union, around 600 of the 1,500 people working for the company's subcontractors have also decided to leave.

Based on the agreement between the factory's union, the management and Prime Minister Aleksandar Vucic, the social programme entails a severance package as prescribed by law and compensation in case of unemployment, while workers who have chosen to leave the company voluntarily may also count on a fixed amount of €3,000, with compensation for unused annual leave.

For example, the workers who have spent three years in the factory, which is the case for most of them, can count on severance packages worth €4,800.

Despite the recent move, the Serbian government said on July 1 after Vucic's meeting with the CEO of Fiat Alfredo Altavilla in Turin that FCA remains committed to its operations in Serbia.

FCA, a joint venture between Serbia’s government and Italy's Fiat, is Serbia’s top exporter, though its exports dropped to €1.18bn in 2015 down from €1.36bn in 2014.

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