Signing bonuses may get GM and UAW over hump
Filed under: GM, UAW/Unions
Although labor talks between GM and the UAW have been going on since the union’s contract expired last Friday at 11:59 PM EST, we’ve been following the late-night negotiations from afar, waiting for something that amounted to more than the mainstream media’s perpetually boring status updates. That finally came today in an article in the Detroit News, which reports GM may be considering signing bonuses for current works in an effort to win the hearts and minds of the proletariat if the automaker drops billions of dollars in retiree health care costs.
It’s estimated that of the 270,000 retired workers and their 70,000 surviving spouses, GM will need to pay over $50 billion in health care costs - but it doesn’t have the funds. The move to offer signing bonuses to current workers was devised so that GM could lose the insurmountable health care costs that will likely go up in the coming years, and replace them with lump sums now, when the General can afford it.
The plan is to set up union-controlled trust funds that would receive stocks and cash, and would negate the need for GM to foot the bill. However, negotiations, which have been in constant turmoil, have broken down again, with the two parties conflicted on how much money to throw into the assets and what happens if health care costs exceed the amount of money stored up by the UAW.
[Source: Detroit News]
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