2nd UPDATE: Chrysler, GM Aim To End Union Job Banks
January 23 2009 - 4:44PM
Dow Jones News
The United Auto Workers will end its jobs-bank program at
Chrysler LLC, effective Jan. 26, while General Motors Corp. (GM) is
in talks with the union about a similar deal.
The UAW alerted local union presidents at the third-largest U.S.
auto maker via a letter delivered this week, according to a union
official who asked not to be identified because the letter isn't
public.
In a statement, Chrysler said it "continues to work closely with
its UAW partners to comply with the terms and conditions outlined
in the government loan agreement. Discussions with the UAW will
continue as we jointly work together to meet the timing deadlines
established."
GM confirmed its own discussions with the UAW.
Ford Motor Co. (F) spokeswoman Marcey Evans had no comment on
whether the company was talking to the UAW about its jobs bank.
However, Ford has insisted that it wants to share in any of the
concessions granted to the other automakers.
Ford has not yet taken a loan from the government.
Ford has about 1,400 workers in the bank as of November,
receiving anywhere from 80% to 100% of their pay.
The major U.S. auto makers, under current contracts, are
required to place workers in the job bank instead of firing them
when production is halted.
Those workers receive about 80% of their pay with the majority
of that money coming from the company and the remainder from
federal unemployment contracts.
Chrysler has been trying to hammer out new cost-cutting measures
from unions and other stakeholders to show the federal government
that it is restructuring after receiving $4 billion in low interest
loans. It is still waiting on an additional $3 billion in
support.
The UAW said in December it was considering ending the jobs-bank
requirement.
UAW President Ron Gettelfinger said earlier this week that he
was comfortable in meeting a federal-government deadline of Feb. 17
for Chrysler to present a viable restructuring plan, including UAW
concessions.
GM faces a similar deadline to secure its own federal aid.
-By Jeff Bennett and Sharon Terlep, Dow Jones Newswires;
248-204-5532; jeff.bennett@dowjones.com
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