Ford is slashing overtime for white-collar workers as part of the company’s efforts to reduce salary-related costs by 10% by year-end, The Detroit News reported.
The paper said Ford is reducing the number of salaried employees eligible for overtime and cutting the hourly rate the company pays for overtime, according to two memos sent to employees last week.
From September 1, only general salaried personnel and managers who work directly with hourly workers in factories will be eligible for overtime, the Detroit News said.
Ford spokesman Oscar Suris could not estimate for the newspaper how many of the company’s 46,000 white-collar workers will be affected but the changes only affect employees who are classified as exempt from federal overtime requirements, generally mid-level managers and above.
The Detroit News said that, from October 1, Ford is cutting overtime pay rates for salaried workers. For workers who earn $40 an hour or less, overtime will be paid at their normal hourly rate rather than time and a half. For those who make more, the overtime rate is capped at $40 an hour.
On Sunday and holidays, overtime will be paid at each worker’s normal hourly rate, up to a maximum of $53 per hour, the report added.
The Detroit News noted that Ford, which is slashing operating costs to offset difficult market conditions, has warned it will likely cut its white-collar work force later this year to achieve a 10% reduction in personnel costs worldwide – the layoffs could begin as early as October.
The overtime cuts are part of an effort to minimise the job losses, the paper added.