IUE-CWA Announces Deal With GM On Retiree Benefits
September 01 2009 - 1:05PM
Dow Jones News
General Motors Co. has agreed to cover a portion of retiree
medical and pension costs for members of a union representing
thousands of GM and Delphi Corp. (DPHIQ) workers, the trade group
said Tuesday.
The auto maker will contribute to the pension plans of Delphi
retirees covered by the IUE-CWA, an industrial division of the
Communications Workers of America union. The company also will
continue to fund health-care coverage for younger-than-65 retirees
of a GM truck factory in Moraine, Ohio, who also are represented by
the IUE-CWA.
GM had already struck deals with its largest union, the United
Auto Workers, to cover Delphi pension shortfalls and retiree
medical costs.
Pension plans held by Delphi, GM's former parts arm working to
emerge from bankruptcy protection, had been turned over to the
Pension Benefit Guaranty Co. GM has agreed to cover the difference
between PBGC payments and the amount initially pledged to
retirees.
The auto maker made a similar deal with the UAW. Retirees of the
Moraine factory will continue to receive health benefits, though at
a lower level than GM agreed to in the labor deal struck before the
auto maker entered bankruptcy protection in June. Retirees older
than 65, who are eligible for the federal Medicare program, will
receive no benefits.
"We're not happy people who worked long and hard will not get
their full benefits," said IUE-CWA President Jim Clark. "But the
devastation we were on track for has been averted." Clark said
roughly 41,000 retirees and their dependents are covered under the
deal, though many may be covered by alternative plans.
A bankruptcy judge must approve the deal.
-By Sharon Terlep, Dow Jones Newswires; 248-204-5532;
sharon.terlep@dowjones.com.