Tuesday, April 28, 2009

Black Money: GM’s Workers in a tough situation

In an attempt to avoid bankruptcy, General Motors announced plans to cut 23,000 jobs by 2011, with another round of buyouts in the works that will likely be its stingiest yet.

While discussions are currently taking place on what the next buyout offer will entail, the company is remaining tight-lipped for now. "We don't have anything to announce at this time," said GM spokeswoman Sherri Childers Arb.

The United Auto Workers union was not available for immediate comment.

But with the company in such serious financial trouble, the latest offer is likely to be stingier than what employees have received in the past.

"The financial condition of the company has deteriorated, so the ability to provide generous buyouts has declined as well," according to John Weykamp, an auto restructuring expert at accounting firm Crowe Horwath.

Most recently GM (GM, Fortune 500) offered a buyout package in February to cut down on the number of hourly workers.

Approximately 22,000 eligible employees were offered full pension and health care coverage, in addition to the buyout package, which included $20,000 in cash and a $25,000 voucher toward the purchase of a GM car.

Employees had between February and March 24 to accept those buyout provisions. About 7,000 employees agreed to those terms, according to Childers Arb. The workers who took the buyouts had to leave the company by April 1.


Click to read.

No comments: