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Thursday, January 24, 2008

The future of buyouts

The U.S. auto market has typically been a pacesetter when it comes to union contract negotiations, collective bargaining agreements, and now ...buyouts. It is a fact that America's large unions keep their eye on the auto industry when it comes to comparative analysis for the purpose of wage, benefit, and buyout negotiations. UAW and Ford have set the stage for future buyouts in labor intensive industries where automation, subcontracting, illegal immigration, and foreign competition have taken a heavy toll on the U.S. blue-collar worker. Large unions that represent America's postal workers, like the American Postal Workers Union and the National Postal Mail Handlers Union, continuously monitor the labor climate during these troubled times to garner equal or greater results. As the country snowballs into a recession, the auto industry, led by Ford and the UAW, are taking proactive steps to re-take the competitive lead in the global auto market by offering buyouts to each and every worker. The Detroit Free Press reports the buyout offer will look like this:

  • Under a special termination-of-employment program, retirement-eligible workers who volunteer to leave the company and forgo all benefits except accrued pension can receive a $140,000 buyout.

  • For workers who have at least one year of employment with Ford, the special termination program calls for a payout of $100,000, with the worker forgoing all benefits except accrued pension.

  • Under an educational opportunity program, workers with one year of service are eligible to receive up to $15,000 in college tuition for up to four years. Workers who take part in this program can receive medical benefits and half of their regular pay while enrolled in school.

  • Workers also could opt to set aside $100,000 in a family scholarship program to be used for an educational program for spouses, children or grandchildren.

  • Workers 55 and older who have 30 or more years of service are eligible to receive a $35,000 check and begin retirement immediately with full benefits.

  • Workers 55 and older with 10 or more years of service will be provided a fixed level of income for life, which varies according to each employee's service with the company.

  • Workers with at least 28 years of service are eligible to take a leave for two years until they reach 30 years of service, when they can retire as normal. During their leave, the workers will receive 85% of their pay.

File under "postal buyout" for reference