More than 800 Baltimore-area General Motors workers received their buyout packets yesterday, giving them 45 days to decide whether to accept a severance package and leave the troubled automaker.
Hourly workers at GM's Allison Transmission plant in Baltimore County and displaced workers from the now-shuttered Broening Highway van assembly plant in East Baltimore were invited to meetings yesterday. Company officials and a member of the United Auto Workers union explained the buyouts.
In an attempt to dig itself out from financial troubles, the automaker said last month it would offer voluntary separation agreements or buyouts to its entire hourly work force of 113,000. The severance packages range in size, depending on each worker's age and years of service.
About 300 workers gathered at UAW Local 239 union hall on Oldham Street to listen to GM officials and ask questions. Those emerging from the hall an hour and a half later had mixed feelings about what they were going to do.
"If you're young and only have 10 years [of service], you'd better take the money and run," said Al Russell, 51, who has 21 years with GM. The electrician from the closed van plant, who is five years shy of eligibility for early retirement under the plan, said he'll stick with the company.
Joan Pacifici, 67, a facilitator from the van plant, is pretty sure she'll take the $35,000 incentive to retire.
"I can't go back to the line," she said. "I physically can't do it."
Local 239 President Fred Swanner said each employee has to weigh the pros and cons based on his or her personal situation.
"Some will decide today, some will take the 45 days," he said.
GM said 370 hourly employees at the Allison plant and about 450 laid-off workers from the van assembly plant, which closed last year, are eligible for the buyouts.
Workers with less than 10 years on the job are being offered $70,000 to leave the company and forfeit all health care and retirement benefits. Workers with 10 or more years are being offered up to $140,000 to leave the company without benefits.
Others are being offered a $35,000 incentive to retire. Workers with 27 years of service but less than the 30 needed to retire with full benefits are eligible for early retirement. They will receive about 85 percent of their benefits until they reach what would have been their 30-year mark, then they will get full retirement benefits and pension.
Workers from five defunct GM plants - including the Baltimore van assembly plant - are being offered early retirement with 26 years of service.
Analysts estimate the buyout program will cost GM between $1.8 billion and $2 billion.
GM officials have been traveling around the country to explain specifics to employees since the buyouts were announced March 22. Workers have 45 days from the date of the visit to decide. Once they accept the package, they have seven days to change their minds.
The company said it plans to approve buyouts from all qualifying employees. But if too many eligible workers sign up, there is language in the company's contract with the union to address a possible shortage, said GM spokeswoman Katie McBride.
She declined to elaborate on what those options are.
Despite its financial woes, GM still plans to make a $118 million investment in the Allison plant to manufacture hybrid transmissions for light trucks, McBride said. On Feb. 1, GM Chairman G. Richard Wagoner Jr. traveled to White Marsh to announce the expansion and the hiring of up to 87 people. The plant currently employs 440.
The White Marsh expansion was good news for some workers displaced by the shuttered van plant in Baltimore. Many of the 1,100 Baltimore workers laid off in May retired or found jobs elsewhere in GM. The rest are part of GM's job bank, volunteering or going to school while collecting their paychecks and benefits under a provision of their labor contracts, which expire next year.
Some, like Russell, will stay in the job bank and hope a job opens at another GM plant. However, those who stay face an unknown future. The union's contract with GM is up next year, and workers acknowledge they might have to make concessions in order to keep their employer afloat.
Jerry Smolenski, 63, has 20 years with the company but doesn't want to take the buyout and give up health care benefits. The millwright, who used to work at the van plant, hopes to stick with the company and get a job elsewhere. "Give me health care and $140,000 and I'd leave right now," he said.
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By the numbers:
Baltimore-area GM workers received buyout packages from the automaker yesterday. A look at who is eligible:
370 hourly workers at the Allison Transmission Plant in White Marsh
450 laid-off hourly workers from the closed Broening Highway van assembly plant in Baltimore
113,000 hourly workers companywide