Traverse Forum banner

1 - 1 of 1 Posts

·
Registered
Joined
·
426 Posts
Discussion Starter #1
General Motors Corp. said Tuesday that it will offer early retirement incentives and buyouts to all 74,000 of its union workers as it continues to reconfigure itself into a smaller, leaner company and return to profitability.

The cuts, expected to trim about 20 percent of the United Auto Workers members now on the payroll, would be completed by July 1.

The cuts are not expected to affect the fall launch of the new Chevrolet Traverse large crossover utility vehicle to be built at GM's Spring Hill, Tenn., plant, the automaker and union officials said.

Up to 600 Spring Hill workers might take the buyouts, out of about 4,000 who will be employed for production of the Traverse, but their replacements have already been figured into overall plans and will be trained and ready to go when production of the vehicle starts, the officials said.

"We expect the number of our team members who choose to retire will be significant, but as they go out, there will be trained workers ready to take their place," said Michael Herron, chairman of UAW Local 1853 in Spring Hill.

Wages are a factor

Under a deal with the union last year, GM can replace up to 16,000 UAW employees with new non-assembly-line workers who would be paid half of the $28 an hour that union members now receive. The two-tiered wage plan was a key component of the new union contract ratified in September after a brief strike.

Incentives for early retirement would total $45,000 for production workers or $62,500 for skilled trade employees, the company said in an announcement of the program.

Those not eligible for retirement but with at least 10 years of service could receive a lump sum payment of $140,000 each in return for a complete separation from the company with no rights to other benefits, including pension or medical.

For those with fewer than 10 years, the amount would be $70,000.

Initial reaction in Spring Hill seemed favorable.

"There is a lot of excitement at the plant at what the options would be for these longtime workers to retire," Herron said. "A large number have worked 30 years, and if they are financially ready and have made the decision they would like to retire, there are some good options for them."

No matter how many leave, "There won't be any impact on the Traverse launch," said Dan Flores, GM's manufacturing and labor spokesman.

"We have experience exiting large numbers of people from the company without affecting production, product quality or worker safety," he said. "In 2006, we offered an attrition plan that resulted in 34,410 employees leaving the company and there was no problem with any of our facilities.

"The Spring Hill organization is very experienced at making cars and trucks, and they are up to the challenge of building a first-rate product for our customers."

This latest attrition plan will be explained to workers in a series of meetings at all eligible GM facilities over the next few weeks, Flores said. Employees will have 45 days to decide whether to apply for a buyout, and then an additional seven days to back out.

"All will have exited no later than July 1, and just as we did in 2006, we will have a plan for every replacement," he said. "It will demand a lot of focus, but the launch of the Traverse is of the utmost importance and will receive the proper attention."

Spring Hill gears up

Vehicle production at the Spring Hill plant ended in late March 2007, and the majority of the facility's workers had been on furlough.

They were called back for three weeks beginning Feb. 4 for initial training and job selection for startup of Traverse production, and they are scheduled to return on a permanent, full-time basis in the summer.

The Traverse is scheduled to go on sale in the fall.

The timing of the buyout program works well with the Traverse launch schedule, the UAW's Herron said. "Having the retirement program at this point and not in the fall where it would impact the launch is much better," he said. "We can go ahead and let those folks retire, and have their replacements ready to go."

This newest buyout program is the best GM has offered yet, Herron said, particularly because of the various options the retiring workers can choose — several of which have tax advantages.

GM said the workers could opt for a one-time, lump-sum cash payment; roll the money into their 401(k) or Individual Retirement Account balances; or take the money in monthly payments to bolster their retirement incomes.

"We've worked with our UAW partners to ensure our employees have a variety of attractive options to consider," Rick Wagoner, GM's chairman and chief executive, said in announcing the program. "The special attrition program is an important initiative that will help us transform the work force."

Source: http://www.tennessean.com/apps/pbcs.dll/article?AID=/20080213/BUSINESS/802130401/1003/NEWS01
 
1 - 1 of 1 Posts
Top