GM To UAW: Take This Job And Keep It

Edward Niedermeyer
by Edward Niedermeyer
gm to uaw take this job and keep it

When the music finally stopped at Old GM, the UAW’s VEBA fund was left holding a lot of IOUs. On those merits, the union’s benefit trust was given about 17.5 percent of the equity in the bailed-out and re-organized New GM. UAW leadership has always maintained that having its membership’s benefits staked on the company’s financial performance would not change its mission, and that VEBA’s representative on GM’s board, Steve Girsky, would operate free from union influence. And one hopes he would, considering he’s being paid well to advise CEO Ed Whitacre. But the tension between GM’s IPO sprint and the UAW’s non-VEBA interests never goes away, and the Wall Street Journal [sub] is reporting that the latest spat is over the old hobbyhorse of buyouts.

The UAW apparently thinks its 2006 again, and is “pressing” GM to bring back buyouts. These cash-for-quitting offers were the preferred method of getting rid of workers who had become too senior to afford, under such great GM CEOs as Rick Wagoner. And the union’s argument is rife with the attitudes of the bad, old days. Let’s not sully the subtleties of the WSJ’s take:

If GM doesn’t thin its ranks, scores of veteran factory workers in the next few years will find themselves without jobs or unemployment benefits.Laid-off factory workers once could remain on GM’s payroll for years receiving almost full pay and benefits, but now they can remain on the rolls no longer than two years before their company-paid unemployement benefits run out.

See? Before, laid-off workers could receive full pay and benefits for years, and now laid-off workers only receive benefits for years. And now, having cut costs all over, GM isn’t interested in paying experienced workers to learn. With production steadily expanding, GM has “restored or created 9,100 jobs” since bankruptcy, and under two-tier wage structures those new workers are being paid competitively. So the old guys who are making nearly twice as much should get their own private bailouts, at the expense of GM’s financial health (on which the larger union’s benefits depend)? Time Magazine knows what’s up, and chronicles the toxic effects of two-tier wages on the union, complete with quotes like “It destroys solidarity.”

But GM doesn’t want to go back to 2006, when it paid $3.8b to buyout 34,000 workers (do the math). With today’s announcement it has essentially ruled out any further buyouts. Now it’s up to the UAW to balance its own competing interests and do the right thing.

Join the conversation
2 of 6 comments
  • Greg Locock Greg Locock on May 19, 2010

    Those redundacy payements were negotiated in good faith by adults on both sides. They traded off higher immediate pay rises for long term benefits. With 20/20 hindsight, perhaps one side or the other miscalculated. If in your wage negotiations you never had to consider the long term implications of your contract that merely demosntrates your misunderstanding of the situation.

  • Boyphenom666 Boyphenom666 on May 20, 2010

    Somebody needs to get it through the union's head that the old days are over. The customer comes first and if the customer isn't getting the best car for his money, he is going to go somewhere where he can. You would think that riding market share from 50% down to 20% (and even less in passenger cars) would have been enough to teach them this lesson, but apparently they haven't learned. The same customer-first mentality is also applicable to shareholders. Shareholders are also your customers and if shareholders can't get an adequate return on their investment, the stock price is going to go nowhere. The UAW may not care, but what about all those shares of GM and Ford stock that are going to be in the 401K plans of employees?

  • Analoggrotto Porsche will never reach the status of TESLA.
  • Analoggrotto WHy augment reality in a Ferrari when you can experience the future today among the elite of society's most affluent from behind the wheel of an Elon Muck SpaceX Affiliated TESLA.
  • Tassos I tried to post a link (2 mins of Trump's speech to a Detroit Supplier) but it did not show (yet).He lamented the demise of the Big 3 due to the EV mandates, and told them Idiot Joe Biden will make them bankrupt and they will all lose their jobs.The most important thing he did not mention was that none of the onetime big 3 can make a BEV at a profit, after more than a full decade of trying.What's more, The only automaker in the Free World that has been able to make a BEV at a profit and has massive sales, dwarfing all the rest BEV models put TOGETHER, is the very Domestic (But not unionized, and with good reason!) T E S L A.
  • Tassos I have been a very happy Honda owner for many many decades, this clueless clown does not know what he or she is talking about, IF he refers to me in his hatchet piece.I am a big admirer of the Honda Accord, of which I owned a coupe 5 speed from 1994 to 2016, it was way underpowered by today's standards but it had excellent quality inside and out.and also the CIvic hatch, which I bought new in 1991 and owned until it was totaled (100% the other guy's fault) in 2016, which was the perfect city car, (as its latin name suggests, illiterates) very lightweight and quick on its feed despite its modest HP.I also was always impressed by the Accord Hybrid, which has the same stellar MPG as the Camry Hybrid, but with far more satisfying driving dynamics and styling.So again, Christine, what the hell are you talking about?????
  • TheEndlessEnigma Here comes the Tassos rant...