Siemens and Central Works Council agree on package of employee measures

MUNICH, Aug. 26, 2008 (Press Release) - Siemens has reached agreement with representatives of the Central Works Council on a comprehensive package of measures for the employees in Germany who will be affected by the planned job cuts. The planned elimination of 5,250 jobs primarily in administrative functions is intended to cut costs by €1.2 billion by 2010. “We’re pleased we’ve been able to reach agreement with the Central Works Council so quickly. This ends the phase of uncertainty. Now we can begin at once with the urgently necessary and economically vital implementation of the job cuts and our discussions with the employees affected,” emphasized Siegfried Russwurm, Siemens’ Chief Human Relations Officer. The company’s offers to employees will include internal transfers, early retirement for older employees, part-time pre-retirement contracts, termination agreements and the possibility of joining a so-called transfer company, which will operate for up to 24 months. Siemens intends to begin making concrete offers, which employees can accept voluntarily, at the beginning of September 2008. The company intends to book a substantial part of the restructuring costs incurred from these measures in the fourth quarter of the current fiscal year.

To prepare employees for the changed requirements of today’s labor market, the Siemens transfer company will focus on training opportunities as well as job counseling and placement services. Employees joining the transfer company will be able to obtain, for example, additional qualifications recognized by the German Chamber of Industry and Commerce – such as certificates of vocational competency in promising fields of technology and engineering – at Siemens’ training centers. In the transfer company, which is scheduled to begin operation on November 1, 2008, employees will continue to receive 85 percent of their current gross salary. The goal of the transfer company is to find jobs for employees both in and outside Siemens. Placement services via a job market set up by Siemens are planned to start as of September 1.

Siemens AG (Berlin and Munich) is a global powerhouse in electronics and electrical engineering, operating in the industry, energy and healthcare sectors. The company has around 400,000 employees (in continuing operations) working to develop and manufacture products, design and install complex systems and projects, and tailor a wide range of solutions for individual requirements. For over 160 years, Siemens has stood for technological excellence, innovation, quality, reliability and internationality. In fiscal 2007, Siemens had revenue of €72.4 billion and income from continuing operations of €3.9 billion (IFRS).