Laid-Off GM Workers Keep Getting Paid By GM

Laid-off autoworkers keep getting paid in GM program
Tue Nov 29, 2005 8:37 AM ET
By Jui Chakravorty
DETROIT (Reuters) - Dean Braid does not have a job, but the 49-year-old
autoworker is not unemployed either.
The Michigan native, who once helped develop the V6 engine for General Motors Corp., was laid off after about 20 years on the job -- yet he still collects his full salary.
"I'd much rather be working, doing what I enjoyed doing," Braid said. "But things could be worse, I suppose."
Braid is one of thousands of U.S. autoworkers who, instead of working on engines or installing car parts, spend their time doing crossword puzzles, watching movies or doing community service -- and keep getting paid by GM's jobs bank program.
The jobs bank was established in 1984, during contract talks between the United Auto Workers Union and the Big Three -- General Motors, Ford Motor Co. and Chrysler Corp.
The program guarantees pay and benefits to union members whose jobs were eliminated due to technological progress or plant restructurings.
Some analysts estimate General Motors has about 5,000 employees in its jobs bank, but the auto giant does not disclose figures. However, according to a four-year labor contract GM signed with the UAW in 2003, the automaker agreed to contribute up to $2.107 billion over four years.
Rival Ford Motor Co., which was also responsible for Visteon Corp.'s union employees, agreed to contribute $944 million in its contract, drawn up the same year.
In most cases, GM workers end up in the jobs bank after 48 weeks in "layoff status" -- which entitles them to government unemployment benefits and a supplemental payout from the automaker that brings the total payment to 95 percent of their take-home pay.
The workers then move into the jobs bank, which entitles them to their full gross pay. In some cases, workers go directly into the program and in all cases, the workers can stay in the jobs bank until they are eligible to retire or be placed in another job.
Braid used to work at the Buick City complex in Flint, Michigan -- once a manufacturing complex more than a mile long, now reduced to mostly empty parking lots. Baird lost his job in 1999 when GM ended Buick production in Flint.
When Braid first joined the jobs bank program, he was required to spend 40 hours a week at the plant, but without work. Others like him go to the plant and sit around, read the paper, solve puzzles or watch videos.
"People think it's awesome to get paid for something like that. But the thing is, it steals your dignity, your feeling of self-worth. It's a horrible thing to ask a worker to do, day after day, year after year," he said.
GM spokesman Stefan Weinmann said he was not aware of a mandate that requires workers to be at the plants. "I'm pretty certain that everyone has a choice," he said, "they can go to school, go to the plant or do community service."
Braid now helps Doug, a 50-year-old quadriplegic, with household chores such as mowing the lawn or patching the roof. It is part of a community service effort organized by the union, with the support of the company.
COSTLY BANK As GM struggles with high health-care and commodities costs, loss of U.S. market share to foreign rivals and sputtering sales of its sport utility vehicles due to high gasoline prices, analysts worry that new jobs cuts will add to costs that are already too high.
GM has lost nearly $4 billion this year and its recent announcement it would shut down 12 plants and slash 30,000 jobs could mean more additions to its jobs bank.
Some analysts say the union and GM are in talks about the plant closings and the fate of the affected workers, and that GM was expected to press the UAW to eliminate the jobs bank. "We do talk with the UAW all the time but we can't really go into details on what...the discussions are," Weinmann said.
GM can stop operations at plants before the contract ends in September 2007, but closings are negotiated as part of new contracts. UAW workers laid off next year will eventually be placed in the jobs bank unless the automaker negotiates early retirement packages.
"The jobs bank is in place for the duration of the contract. No changes have been made in light of the new cuts GM announced," a UAW spokesman said..
"We do want to work with our unions to identify a possibility for some buyout or retirement packages. Apart from that we'll have to work through the issues on a local level and try and work out solutions together," Weinmann said.
J.P. Morgan analyst Himanshu Patel estimates buyouts of union workers would average $80,000, potentially bringing total costs to $917 million. "Other restructuring charges could equal or exceed this buyout amount," Patel wrote in a research note.
The UAW represents 107,000 GM workers, nearly half of whom will be eligible for retirement in the next three years. GM workers can retire with full retirement benefits after a minimum 30 years of service.
GM's restructuring also sets the stage for tense contract negotiations in 2007 with the union, which called the cuts "extremely disappointing, unfair and unfortunate."
"I would be two years short of retirement in 2007," Braid said. "So that's a bit worrying, if they do away with the bank and I don't get full retirement benefits. But I have colleagues whose children would just be graduating from high school at the time, and it's a bigger fear for them."
Reuters 2005. All Rights Reserved.
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Canadian autoworkers do not have a jobs bank. We get paid gov't unemployment insurance plus SUB from GM while laid off. All told, about 70% of our wages. Not complaining, but nothing like the deal the UAW has.
Jane
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After drawing out your State unemployment benefits for 26weeks and using money from the SUB fund your MAY be eligible for the JOB bank. Do NOT believe everything you read in the papers. You could fill volumns with what they don't print.
The Job Bank came in 1984 as a trade off for consessions UAW gave to GM. Ole Roger B Smith then took the windfall partially funded Saturn Corp. Get a copy of the GM/UAW contract and read it. The truth about all of this will be told.
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Interesting. Then it is not much different than our contract...
Jane

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All jobs should be unionized, that way no one goes without a paycheck whether you work for it or not? Unemployment could be a thing of the past.
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That's why we pay unemployment insurance premiums...to collect when we are unemployed, as with any insurance. I don't know about the US, but Canada's fund has a huge surplus. The SUB fund that GM pays above UI is funded by overtime in the plants (50 cents per hour OT worked, I believe). We don't have a jobs bank in Canada, nor do we get anywhere near full wages when laid off.
Jane

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So who pays full pay for someone not working? Dream on.
It's ideas such as this which would create an inefficient society where no one wants to work. The result is the printing of excess money and run away inflation.
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wrote:

Don't you think he was being tongue-in-cheek?
Jane
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Spam Hater wrote:

Many in the work force (Union & Non Union alike) draw full pay for not working. There are a lot of lazy people in this world.
Research the history of the programs and you will see why they came about. The UAW was looking for a means to guarantee their members a minimium number of hours of work a year (1615 hours as I recall) and this program does that. None of this work 6 months and then draw unemployment for 6 months stuff. By the way, SUB does not pay a 40 hour check, instead it pays 95%of 40 hours minus $20 then this amount is taxed.
Why is this important anyway. The problem isn't with these programs but with unfair trade practices and soaring fuel costs. A form of National Health Care would help too.
Wow! National Health Care, what a dream that would be! Even the poor could get the care they deserve. Bring the medical industry under total Federal control and dole it out fairly and equally, bring costs back in line. Well, I can dream can't I?
NOYK in FLA
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wrote:

They are called.... "Government Employees"

<rj>
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