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An anonymous source sent us this heads-up. We’ll chase it up tomorrow (Monday). Meanwhile, back in October ’07, Newsweek pegged the number of GM retirees at 340k. So, if true, this works out to a $238m hit to GM’s bottom line. At least. UPDATE: GM spokesman Tony Sapienza tells us that GM paid up to $700 in “year-end inflation adjustments” to 284k hourly retirees on Monday. Some 73k surviving spouses received up to $455 each. The total cost to GM: $200m+.
13 Comments on “Wild Ass Rumor of the Day: GM Pays UAW Retirees a $700 Xmas Bonus...”
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Do you think this is a “going away present” to those retirees? They figure that if those retirees get to buy their grandkids a Wii, they won’t be so mad when they get their pensions and health benefits that they worked so hard to get taken in a few weeks?
This is one of the worst things about Blogs.
I can understand if it was a “trusted source”, but to publish this when you only have an “anonymous source”?
It’s scurrilous and unnecessary, especially as you say yourself you’ll check it tomorrow.
Otherwise, your work and the associated user comments are most stimulating.
Ahh the mythology of ‘pity them’ continues…
Those poor retirees will continue to get their pensions via PBGC and healthcare via Medicaid/care.
Albeit at more realistic levels.
It was neat fantasy – keep getting overpaid and, for all intents and purposes, have unlimited healthcare. After you retire.
Free ride is over. Sorry if you actually believed the people who told you this gravy traing could keep rolling.
Reality checks will continue until comprehension sets in.
Here’s what I found from the 2007 Contract
Retiree Lump-Sum Bonus
UAW GM retirees and surviving spouses, whose benefit started before Oct. 1, 2007, will receive four lump-sum payments during the proposed 2007-2011 agreement. The payment for December 2007 will be $700 for all retirees and $455 for all surviving spouses. The lump-sum payments to be made in December 2008, December 2009 and December 2010 will be $23.33 times years of credited service, with a minimum of $233.33 and a maximum of $700. Surviving spouses will receive 65 percent of the retiree amount.
Source: http://www.uaw.org/contracts/07/gm/gm06.php
It appears that similar language is in the IUE/CWA contract.
Conslaw
Sounds like the source may be technically correct but trying to stir something up, like a teaser on the local news.
porschespeed
You’re assuming that all 314k of the GM retirees Newsweek lists are UAW. My father is a non-union GM retiree and his dwindling healthcare “benefits” are being cut outright at the end of the year. They’ll continue to cover my mother (if you want to call it coverage) until July when she turns 65, at which point she too will be dumped onto Medicare. His retirement in general has been less than rosy thanks to the union.
My Mother-In-Law is a GM hourly retiree and got her check on Saturday. Don’t know the amount..she said she was surprised she got it.
My Father-In-Law is a Ford hourly retiree and got a letter saying he would be getting a check soon.
Nothing to see here…move along…move along.
Petemoran is right. there is no point trying to beat the bushes with everything negative. The key point to focus on is what to do now? We all kind of know we all got here (union, management, real competition, etc, doesnt take a rocket scientist) I would like to see more discussion of the points Sen Corker raised. why indeed shouldnt the UAW simply match the competition in 2009? To me, their position is unsupportable, and if they all lose their jobs it will serve them right Here in Canada, the CAW are even worse. Sad but true.
Ford Windsor, Canada is offering early retirement buyout packages of $70k plus a $35k coupon to buy a new Ford vehicle.
Pretty rich for a bankrupt company.
Jimal,
On a personal level, I hope they do OK. Really, I don’t wish them suffering. But, adjustments are sometimes required. Sometimes unpleasant, sometimes painful.
Everybody who analyzed pensions and eternal healthcare for retirees even in the 70s knew it couldn’t go on. It lasted a lot longer than those companies could afford it. The piper has to be paid.
There are no other options.
I did some checking with a family friend(after posting above). She got her checks(widow of another retired worker) yesterday as well. She was somewhat suprised by it.
As for the retirees getting too much in the way of pension and benefits. You and I may agree. But this is what they were promised. These things are what they worked for. A lot of people worked very hard at the Big 3 for a long time in order to provide for their families. How many doctors,lawyers,teachers,engineers, etc.. went to school due to their auto worker parents? Millions? Much of the wealth of the US was created this way. Blue collar parents worked hard for their kids to not have to work in a factory.
@rocket88
This parity with transplants is a good example of technical correctness.
For one thing why don’t these guys say how much foreign auto producers make? Because the hourly wage+benefits are within pennys of parity now.
And the only way to make us “greedy” unionized workers look bad is to add retirees benefits to worker hourly pay, as if we get that too.
porschespeed
My father retired from GM in 1992 or 1993. IIRC, not too long after GM established a cut-off date for non-union retirees to be eligible for the old school retirement plan (pension, health insurance, long-term care, etc.) Since then they have slowly frittered away at his benefits to the point that as of next year he no longer has health coverage.
I understand and I agree that the defined benefit pension model is unsustainable, which is why the system was changed for non-union employees and retirees years ago. The problem I have (and the problem my father, who retired 15 years ago, REALLY has) is that they’re changing the rules for retirees long after they can do anything to make up for the loss of benefits. Benefits that were promised to them and that they based their savings and spending habits when they worked on those promises.
Everybody gets hung up on UAW this and UAW that, but the truth is there is a small but not insignificant pool of non-union, non-management retirees who have been getting the short end of things for years because costs need to be cut somewhere and for one reason or the other they didn’t join the union. As my father likes to remind me once in a while, that pool is only getting smaller.
Dollars well spent as GMAC clings to dear life.