There are two deals on the table, one for those workers age 53 to 61 and the other for those 62 and older. At least 10 years of employment with the company is required to be eligible for either group. The yungins are being offered what's called the Separation Incentive Program, which is basically an early retirement package that waives any retirement benefit reductions that would have been incurred under normal circumstances. It appears those eligible for this group will also get 100% of their health care plan's medical credits. For those 62 and up that meet the requirements, there's the Special Early Retirement package that offers three months salary and either a $20,000 car voucher "grossed up for taxes" (I believe that means it's $20,000 after taxes) or a $20,000 contribution to their Retirment Health Account. This group would also receive 100% of their health care plan's medical credits.
Neither of these plans affect the many union workers under Chrysler Group employ. Details of those attrition offers are still being finalized.
Details of Separation Packages to be made to Salaried Employees
As part of the Chrysler Group Recovery and Transformation Plan, the company has targeted the reduction of 2,000 salaried positions by 2008. The Chrysler Group intends to reach that target through attrition and special programs. The special programs include the following separation incentive and early retirement packages for non-bargaining unit (NBU), or salaried employees, announced today, Feb. 23.
The aim of the packages is to reach the 2007 reduction target of 1,000 salaried positions by June 30, 2007. More specific details of the packages will be given to affected employees by management in May and June, when the offers will be formally offered.
The packages include the following programs:
Separation Incentive Program (SIP)
- All NBU salaried employees, age 53 to 61 with 10 or more years of service, with earnings in 2006 of less than $100,000 and select NBU salaried employees, age 55 to 61 with 10 or more years of service with 2006 earnings of $100,000 or greater
- This is in compliance with IRS guidelines
- Eligibility requirements must be satisfied by June 30, 2007
- Offers will be made to select employees June 4, 2007, and returned by June 29, 2007
- Retirements effective June 30, 2007
- Retirement benefits will not be reduced by an early retirement reduction percent
- 100% Retiree Choice medical credits through age 64 and at age 65 100% credits in the Health Care Retirement Account. Ordinarily, an employee must be age 60 with 30 years of service to receive 100%
Special Early Retirement (SER)
- All NBU salaried employees age 62+ with 10 or more years of service as of May 31, 2007.
- Offers made May 7, 2007 and returned by May 31, 2007
- Retirements effective May 31, 2007
- Program incentives include 3 months salary and either a $20,000 car voucher grossed up for taxes, or a $20,000 contribution to the Retirement Health Care Account
- 100% Retiree Choice medical credits through age 64 and at age 65 100% Credits in the Health Care Retirement Account. Ordinarily, an employee must be age 60 with 30 years of service to receive 100%
Similar programs are being finalized for the salaried bargaining-unit (SBU) workforce, which is represented by unions.