GM, Chrysler will give bonuses to salaried workers which may reach 50% of pay

Article by Christian Andrei, on February 11, 2011

Salaried workers of General Motors Co. and Chrysler Group LLC, which both benefited from government-funded bailouts, may get bonuses of up to 50% of their base pay, according to three people familiar with the plans. One source said that GM is planning to pay 26,000 U.S. employees bonuses as much as 50%, with managers receiving about 15% to 20% of their annual salary.

One of the insiders also said that the bonuses for Chrysler's 10,755 salaried workers will average about $10,000.

Meanwhile, some employees who are not subject to government pay restrictions will receive bonuses equivalent to as much as half of their salary.

These payouts are announced as the Detroit three (GM, Chrysler and Ford Motor Co.) prepare for contract talks this year with the United Auto Workers, which is aiming to get a share of the recovering industry.

On the other hand, Ford (the sole major U.S. carmaker able to avoid bankruptcy in 2009) is expected to pay its salaried staff bonuses equal to 10% or more of their base pay.

Gary Chaison, a professor of industrial relations at Clark University in Worcester, Mass., said that the union will be “very angry” about the bonuses.

Chaison explained that if salaried workers receive these bonuses then the demands of the union will increase since management won’t be able to claim inability to pay. [via autonews - sub. required]

Topics: gm, chrysler

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