Delphi late on Friday announced a deal with the United Auto Workers and General Motors to offer buyouts to all hourly employees and reportedly said the agreement represented significant progress in broader negotiations aimed at avoiding a strike.
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According to AFX News, the buyouts greatly expand early retirement incentives announced in March and mean that all UAW-represented employees will be offered something if they want to leave Delphi, which is currently under US Chapter 11 bankruptcy protection.
The UAW reportedly represents about 22,000 of Delphi’s 31,000 workers, and Delphi said it continues to negotiate with other unions to offer similar packages for their members.
As with the previously announced retirement incentives, GM is helping to pay for the buyouts, AFX News said. The first agreement offered retirement incentives for workers with at least 27 years of service and an opportunity to return to GM for 5,000 workers.
The new agreement is subject to the approval of a bankruptcy judge in New York and would offer buyouts of $US140,000 to workers with at least 10 years of service; those with less than 10 years would receive $70,000 to sever ties with the company and give up all benefits except for vested, accrued pension benefits.
The deal would also expand a pre-retirement option to include workers with 26 years of service, AFX News added.
The report said GM and Delphi are each paying half the cost of the buyouts, which could help Delphi avoid a strike, which would be crippling both to the supplier and to GM. Troy-based Delphi has asked a federal bankruptcy judge in New York for permission to void its union contracts so it can reduce wages. UAW members have overwhelmingly authorised the union to call a strike if the court grants permission and the company takes such a step.
Both the company and UAW officials have said they prefer a negotiated settlement to any action by the court, AFX News noted.
