April 29 (Bloomberg) -- German companies such as Siemens AG are exerting pressure on their employees to accept more flexible working conditions, such as longer hours and vacation time based on performance, the Wall Street Journal reported, citing Union officials and economists.

Siemens, Germany's largest engineering company, came to an agreement with 224 employees to work more hours without a pay increase and accept performance-related vacations after it threatened to move 2,500 jobs to Hungary, the paper said.

Economists argue that Germany's 35-hour working week, introduced in 1995, and other labor policies restrict the country's economy, the paper said. According to Holger Fahrinkrug, an economist at UBS AG, the threat of European enlargement means that employers are more able to demand flexibility from their workers, the paper said.

(Wall Street Journal Europe 4-28 A1, A8)

To contact the reporter on this story: Melissa Stock in London at mstock2@bloomberg.net.

Last Updated: April 29, 2004 00:14 EDT