GM Pay Cuts Revealed

A TTAC Tipster writes:

According to one of my GM buddies, the May 1 pay cut is as follows: 10% for unclassified (executives); 7% for Levels 8 and 9 (managers, technical fellows, other senior folks); 3% for Level 7 and below. Levels 8 and 9 and unclassified enjoy the use of company vehicles. Last year, a lot of the Level 8s were forced to take demotions to Level 7: no pay cut, but they had to give up their company car, although they got some financial help in getting a new GM car.

All pay cuts are “temporary” and will be under reconsideration in December.

Last year, there was a merit increase effective June 2008. About 2–3% on average, as I recall. (The previous one had been in October 2006, and I think the one before that was 2004.) So Level 7s and below will see these increases negated. The Level 8s and above are seeing a net salary reduction of about 4%, compared to what they were making before the merit increase.

My old colleague at GM is a product development engineer and is performing a highly-visible and essential function, so he probably won’t be cut this time. He said that they might actually be hiring in that group.

The severance benefits from last year are apparently still in effect (1 month pay and benefits for every year of service, up to 6 months maximum), although he thinks that on March 1 this will be revised.

He says this move needs to be done, as well as some others, including the cutting of underperforming brands. He simply wishes to survive at this point, because for the folks getting laid off it will be very difficult to find a new job with comparable pay and benefits.