Deutsche Post DHL Signs Labor Pact

Deutsche Post DHL, Europe's biggest mail and express delivery company, agreed to a labor contract with the Verdi union, according to a Reuters report.

The agreement extends the existing wage contract through 2011 with a 3 percent increase in December this year but no overtime until June 2011. It also allows Deutsche Post to outsource more of its parcel delivery services but not to lay off workers through the end of 2011. Postal workers will get a one-time payment equivalent to $472 in 2011.

Deutsche Post said the contract will save $206 million in 2010 and $339 million in 2011.

Earnings in the second half are expected to begin to recover following the labor deal, Deutsche Post CEO Frank Appel said Friday.

Contact Thomas L. Gallagher at tgallagher@joc.com.