Autoblog

UAW agrees to suspend GM job banks on Feb 2

Jonathon Ramsey — Wed, 28 Jan 2009 15:22:00 EST

Filed under: Plants/Manufacturing, GM, Earnings/Financials, UAW/Unions

The UAW idled Chrysler's jobs bank earlier this week, and as of February 2, the UAW and General Motors will shut down the job bank it also maintains for its workers. GM is paying the 1,600 workers currently in the system 85% of their on-the-job wages. As of February 3, they will receive a measure of supplemental pay from GM and can apply for unemployment, the total of which should come to 72% of their former pay. The move potentially leaves Ford's jobs bank as the only one left running, but Ford has yet to comment on its status.

[Source: The Detroit News]

UAW agrees to suspend GM job banks on Feb 2 originally appeared on Autoblog on Wed, 28 Jan 2009 15:22:00 EST. Please see our terms for use of feeds.

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Chrysler job bank going on hiatus Monday

Jonathon Ramsey — Sun, 25 Jan 2009 09:35:00 EST

Filed under: Government/Legal, Chrysler, Earnings/Financials, UAW/Unions

The UAW jobs bank is a kind of employment limbo in which workers get paid a portion of their salary but don't work while they wait for their job to open up again. Last year, there were about 3,500 people in this so-called bank of jobs. It is the kind of benefit that can perplex an outsider, because someone can remain in the job bank for years and still get a wage from the company, plus supplemental pay from the company, plus unemployment benefits, plus insurance.

That was the kind of thing that Congress zeroed in on when it created stipulations for granting GM and Chrysler $17.4 billion in bridge loans. The intent was to get domestic automaker costs in line with those of foreign automakers by not paying people who aren't actually working. Due to that, Chrysler's job bank will officially end on Monday, with workers still in the bank being moved to another quizzical state: "enhanced layoff." Those folks will keep their insurance and should receive some kind of job benefits.

The union has told its members that "these provisions will only be in effect until such time as the mandates from the U.S. Treasury Department have been clarified," which would appear to leave the possibility open for a return of the job bank. Chrysler has only said is is working "with its UAW partners to comply with the terms and conditions outlined." GM is still wrangling with the UAW over its job bank. Ford, having sat out the government bailout, hasn't clarified its position on the matter.

[Source: Freep]

Chrysler job bank going on hiatus Monday originally appeared on Autoblog on Sun, 25 Jan 2009 09:35:00 EST. Please see our terms for use of feeds.

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UAW considers dropping "job bank" for idled workers

Jeremy Korzeniewski — Mon, 01 Dec 2008 15:01:00 EST

Filed under: Hirings/Firings/Layoffs, Chrysler, Ford, GM, Earnings/Financials, UAW/Unions

As you read this, there are about 3,000 unionized workers -- down from about 15,000 two years ago -- employed by the Detroit 3 getting paid, despite the fact that they aren't working. While it's nice for America's automakers to have access to a talent-pool of available workers, it's also a major financial drain on an industry that's already reeling from a distinct lack of profits. And with new cutbacks and layoffs being announced almost daily, these "job banks" are increasingly tough to justify, even for the UAW. It's always been a bit of a competitive disadvantage, at least on paper, as non-UAW competitors like Honda, Toyota, Nissan and Hyundai do not keep such job banks. To ease Detroit's transition from bloated, money-losing corporations to lean "right-sized" competitors, UAW Prez. Ron Gettelfinger has brought up the job banks and their possible elimination. Will this be a part of the overall plan to become competitive that the Detroit 3 bring to Congress? We'll find out soon enough.

[Source: Wall Street Journal]

UAW considers dropping "job bank" for idled workers originally appeared on Autoblog on Mon, 01 Dec 2008 15:01:00 EST. Please see our terms for use of feeds.

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American Axle looks to shake loose "job bank"

Eric Bryant — Thu, 25 May 2006 10:04:00 EST

Filed under: Trends, Plants/Manufacturing, Earnings/Financials

American Axle Manufacturing (AAM), one of General Motors' main suppliers, isn't bankrupt,but it is feeling financial pain from the 1,100 workers that it is currently paying not to work. A grand total of $75 million is spent by AAM each year to maintain its share of the United Auto Workers "jobs bank", which represents approximately 2 percent of the supplier's gross sales and a substantial dent in the company's $56M of profit last year.

In order to cut the banked workers free from AAM's balance sheet, the company is mulling the same approach taken by others in the unionized auto world - massive buyouts. Assuming that workers would bite on a hypothetical figure of $100K/each (a number that has been thrown around in the context of similar action from Delphi and GM), the company would obtain a return on its investment in approximately 18 months. The company is intent on returning to its previous financial performance by 2008, which is a move that would require adding $100M to the bottom line each year.

[Source: Detroit News]

American Axle looks to shake loose "job bank" originally appeared on Autoblog on Thu, 25 May 2006 10:04:00 EST. Please see our terms for use of feeds.

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