GM frets over slump's effect on layoff fund

March 23, 1991|By John Lippert | John Lippert,Knight-Ridder News Service Kim Clark of The Sun's business news staff contributed to this report.

DETROIT -- General Motors Corp. has spent $497.9 million to pay laid-off workers since October, according to participants in a meeting in Dearborn, Mich., Thursday of 300 United Auto Workers officials from GM plants around the country.

Even so, UAW officials believe that the $4.3 billion GM set aside to maintain the incomes of laid-off workers will last as long as it's supposed to -- until September 1993 -- unless the recession worsens.

Last month, however, GM told the union it expects the $4.3 billion to beexhausted by the summer of 1992, unless the economy improves, according to a GM official who spoke on the condition of anonymity.

GM has had internal discussions about whether to ask the union to reopen contract talks. UAW officials, including President Owen Bieber, say flatly that they're not interested.

But the union might change its mind if it becomes convinced that the $4.3 billion cap "is going to blow," the GM official said.

A contract signed last year by GM and UAW allows GM workers to collect up to 95 percent of their pay when they are laid off.

Both the union and the company admit that during negotiations last fall, they didn't anticipate the disastrous sales slump that accompanied the Persian Gulf war.

UAW Vice President Stephen Yokich, director of the union's GM department, declined to comment after Thursday's meeting. A spokesman for GM also declined comment.

But participants said that during the meeting Mr. Yokich criticized GM for waiting until this week -- six months after the 1990 contract was signed -- to appoint its representatives to a labor-management committee intended to give the UAW more input in decisions on where GM assigns its work. He also criticized the company for wanting to use temporary workers, instead of laid-off workers, to cover for summer vacations in plants, the sources said.

GM wants to avoid rehiring the 30,000 workers laid off when the 1990 contract was signed because it doesn't want them to qualify for benefits provided by the new contract, UAW officials said.

Rodney Trump, head of the UAW local in Baltimore, said that when the union signed the pact with GM last year, many local presidents worried that there wouldn't be enough money in the fund to protect all workers if the economy turned bad.

Mr. Trump said he and the rank and file hadn't been given specifics about the possibility of reopening the contract yet.

But, he said, many of the approximately 3,000 workers at GM's Broening Highway van assembly plant likely would be eligible for a retirement plan bargainers were discussing yesterday in Detroit, since the average worker here has 23 years of seniority. About 100 Baltimore workers had already signed up for a previous early retirement offer, he said.

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