GM buyouts gain speed

By JIM LEUTE ( Contact )   Friday, May 23, 2008
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— While a quarter of General Motors’ Janesville workforce has indicated it will leave the plant voluntarily, the next step is figuring out how many will leave involuntarily.

About 600 of the 2,400 hourly workers at the Janesville plant signed up by the midnight Thursday deadline for the automaker’s special attrition program.

Workers have seven days to withdraw their participation in the program, which offers a variety of early retirement and cash buyout options.

John Dohner Jr., president of United Auto Workers Local 95, said the number of hourly employees who decided to walk away from the plant didn’t surprise him.

“We thought it would be somewhere between 500 and 600,” he said.

The 25-percent take rate matches a similar buyout program GM offered in 2006, when about 900 of the plant’s 3,600 hourly workers left the plant.

GM spokesman Dan Flores said the automaker will not release results of the attrition program until the first week of June, primarily because the numbers will not become final until the seven-day grace period has expired.

Whatever the final number is in Janesville will be an important factor in the local plant’s production plans.

Starting in July, GM will eliminate one shift of production at the plant that produces full-size sport utility vehicles such as the Chevrolet Suburban and Tahoe and GMC Yukon XL and Yukon. Sales of the vehicles have been hammered by a difficult national economy and rising gas prices.

In announcing that it would eliminate second-shift production in Janesville, GM told the state it would lay off 756 workers. GM’s announcement was followed by layoff notices from local suppliers Lear Corp. (336) and LSI (132).

Whether or not GM will need to layoff 756 people will be determined after plant and union representatives see the final numbers from the attrition program.

With the voluntary departure of 600 workers, the plant’s hourly population will drop to about 1,800. Industry observers say that’s too many to staff one shift that will produce 58 vehicles per hour.

Under the new production model, Janesville workers will build 580 vehicles a day. At full production, they currently build a total of 880 across two shifts.

Janesville plant managers will come up with a number necessary to staff one shift. Union leaders will determine a different number, and the two sides will likely meet somewhere in the middle.

For example, if the two sides agree that 1,300 people will be needed to run one shift, then it’s likely that only 500 workers will need to be laid off.

When reporting layoff numbers to the state, companies tend to estimate on the high side. That’s because the notifications must be made at least 60 days prior to the layoffs, and if more people are laid off than a company originally reported, the company must go through the 60-day process again and accept the costly delays that go with it.

WHAT WAS ON THE TABLE?

General Motors and the United Auto Workers offered a special attrition program to all of GM’s 74,000 UAW-represented employees. While the sign-up deadline ended at midnight Thursday, workers have until midnight next Thursday to change their minds.

These were the options:

-- For employees with 30 years of service, GM offered incentives of $45,000 for production workers and $62,500 for those in skilled trades.

Employees will receive the incentives as a one-time, lump-sum cash payment; as a direct rollover to their GM 401(k) or Individual Retirement Account; as a monthly annuity, or as a combination of partial lump-sum payment and direct rollover.

Employees will keep their GM pensions and health care benefits.

-- Mutually satisfactory retirement for employees who are at least 50 years old with 10 or more years of service. This option provided a pension payment and full benefits based on the employee’s age and length of service.

-- Pre-retirement program in which employees with 26, 27, 28 or 29 years of service grow into a “30 and out” retirement. Until they reach 30 years of credited service, participating employees will get full benefits and a fixed monthly benefit ranging from $2,750 to $2,900.

-- Cash buyout for employees who voluntarily quit and sever all ties with GM. Workers with 10 or more years of credited service or seniority will get $140,000, while workers with fewer than 10 years receive $70,000.

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(57)
gmretirednow
May 26, 2008 at 3:30 p.m.
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HAPPY MEMORIAL DAY TO ALL OF THE GM VETERANS WHO SERVED OUR COUNTRY AND MANY WHO STILL ARE. WE APPRECIATE EVERYTHING YOU DID AND ARE DOING FOR US! GOD BLESS!!
A VERY TRUE CARTOON I SAW IN A MONTANA PAPER RECENTLY SHOWED US COMPLAINING ABOUT THE GAS
PRICES AND THEN SHOWED HOW THE SACRIFICE IN THE WARS WAS AND IS BLOOD AND NOT JUST MONEY! SOMETHING TO THINK ABOUT WHEN WE COMPLAIN EACH DAY! WE MAY FEEL LIKE WE ARE GIVING OUR ARMS AND LEGS AT THE GAS PUMP, BUT IT DOES NOT IN ANY WAY COMPARE TO WHAT THE SERVICE MEN AND WOMEN GAVE AND ARE GIVING NOW!!

garyprimer
May 25, 2008 at 8:10 p.m.
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I had a 66 Dodge with cylinder deactivation. :-)

acejd93
May 25, 2008 at 6:18 p.m.
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If you own a vehicle with cylinder deactivation and compare it to an old one that doesn't like we have, the one with the deactivation gets worse overall milage. Our 06 silverado got an average of 18 on the highway, our 07 only gets 16.8. Again, like I said, it's all how they market their features and what the public will believe. Their milage posted on the stickers are in a perfect controlled environment, not real life.

Zoom
May 25, 2008 at 5:12 p.m.
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GM (and others) has a much simpler feature. It's called cylinder deactivation.

acejd93
May 25, 2008 at 4:17 p.m.
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A little off topic, but speaking of fuel milage, GM has the perfect opportunity to increase MPG ratings but it's the consumer driven horsepower wars that effect it. Most don't realize that if you want horses, you have to feed them! GM has the opportunity to have both but unfortunately they feel the cost to engineer it into production won't be made up in sales, lol. All they have to do is put a derated fuel program as a normal operating mode and when you want or need the power, a second or power program would activate when you push your tow/haul button. GM could still market their class leading horsepower but add more fuel economy to the marketing strategy plus coming in a couple of years with a newly mandated corporate fuel economy ratings, since the most economical mode will be set as a default program when you start the truck, the government will base the ratings off of that. But since when has GM did anything that made any sense!!

gmretirednow
May 25, 2008 at 2 p.m.
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Oh speaking of mpg, I found that just 2 mph less in the speed sure helps the mpg.

gmretirednow
May 25, 2008 at 1:58 p.m.
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garyprimer
Amazingly that Silverado gets 20mpg when I am not towing with it. Much better than my old one did.

garyprimer
May 25, 2008 at 1:51 p.m.
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Give that man an optimism award for buying a new Silverado diesel.

gmretirednow
May 25, 2008 at 1:29 p.m.
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acejd93. Your comments are right on and are great to read because as a recent retiree (4/2008) I also feel it is best to stick together and to do everything possible to keep the plant here. As an owner of a new Silverado Diesel and diesel at over 4.80 per gallon at many pumps, I feel for GM and what it is doing to sales. I still however believe that Janesville builds a great SUV and can build any product if given the chance. The ones on here who never have worked the line, need to try it if ever there are applications taken. Then maybe their story will change on how much we work or dont work. My friend on the door line who opted not to take the retirement said she has maybe 2 seconds between jobs so as for easy work, I dont think there is much of that left. Good luck to all who are layed off in July.

benthinkin
May 24, 2008 at 9:25 p.m.
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The sub benefit talked about here is a program that it is funded in lieu of additional wages. It basically acts like a group savings account.
If any person puts away excess money for a rainy day and uses it during a layoff, they are not required to disclose it as income for the week that the uc is filed.
So opinion get worked up all you want but it meets the guidelines put forth by the state.
If any layed off person had to claim their savings accounts as income, there would be no uc payed out in most instances.

acejd93
May 24, 2008 at 1:38 p.m.
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Opinion80, seeing and doing are 2 different things. If GM hires again, go put in your application if you think the work is easy. The workers make it look easy because they do it for 10 hours a day. Most jobs down there, though, don't have enough time on them to take a drink or blow your nose between jobs without falling behind. We earn a good wage with good benefits but the people who get hired from now on will make less than we do with a fraction of the benefits due to corporate greed. GM might as well install a revolving door on the main enterance because the conditions down there and what the new hires will get paid, I give them 1 week and most of them will quit. The repetitiveness of the job and the physical toll some jobs have isn't hardly worth what we make now let alone making half the money. I don't know what you do for a living but think if your boss came to you and said he'd have to cut your wages because he's not making any money, but then he goes out and buys a new Jaguar and takes a vacation to the Bahamas. Well in perspective, that's what GM is doing to us. Gas prices aren't going to go down any time soon, food keeps going up, taxes, etc.. Now even at the wages you are used to, I'm sure you've had to adjust and things have got tighter, now take a cut in pay or be on unemployment, with or without SUB pay which is a Nationally Negotiated Benefit in our Contract which is looked over by dozens of lawyers and made sure that any and all laws and policies are in compliance. If you feel like that isn't fair, obviously it must be legal so therefore go to your boss and negotiate your own contract with him. Let him take a percentage of your wage for a fund so he can pay you from that when you're unemployed. Depending on what you do, when the local economy suffers from GM losing a shift or at worst closing, you can draw 85% of your wage BEFORE TAXES! Look in the mirror and ask what if this happened to you and if you still can't understand, I guess you're perfect in your own little shallow world.

RUSerious
May 24, 2008 at 1:29 p.m.
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opinions: "I mean, come on, people stepping off the platform to put a part on a vehicle ..." That's not how it works. You heard it backwards.
I'm sure they were happy that you were interested enough to take "a few tours" though.

opinion80
May 24, 2008 at 11:22 a.m.
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roses4me: Maybe your first class should be comprehension - I am fully aware that unemployment is funded by employers and that what you receive in unemployment is directly related to how much you earn if working with the maximum payout being $355 per week. My question was if you are receiving money other than unemployment each week why don't you have to claim it as income each week when you jump on the unemployment website and claim you didn't earn any money that week but did apply for 3 jobs? That is what the average Joe on unemployment has to do. If the money you are using to supplement your unemployment is not in a savings account in your name, in your own bank, it is money that you should claim as income each week and risk having your unemployment benefits reduced just like everyone else.
papagrande: No, not jealous at all. I know people that work there and I have been on a few tours thru the GM plant and can tell you, I saw very few people that looked like they were earning the wages they were being paid. I mean, come on, people stepping off the platform to put a part on a vehicle and then back up to the desk to read another page or two of their book until the next vehicle comes along? Give me a break!

BeenThereDoneThat
May 24, 2008 at 11:22 a.m.
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khulburt, I believe that is not true. Gov Doyle has a plan to help the displaced workers and all of the perks that will come because of it will be free and clear of any hits to your unemployment. At least that's how I understand it...and that's how it worked when Beloit Corp closed.

khulburt
May 24, 2008 at 10:44 a.m.
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i was talking to a committee person the other day and he said excepting money for school could effect our unemployment benefits. im not complaining i just want to make informed desicions . anybody know about this?

papagrande
May 24, 2008 at 10:41 a.m.
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opinions80, your comment boils down to jealousy. Give me a break. They work hard for what they earn just like alot of us in Janesville. I wish I could get free schooling, but I'm not going to cry because someone else has that opportunity.

khulburt
May 24, 2008 at 10:41 a.m.
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amen to that.

roses4me
May 24, 2008 at 10:38 a.m.
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opinion80 wrote: "why should they be able to draw money from a fund that everyone contributes to and not have to claim it as income each week when asking the state to send them an unemployment check?"

You seem to be under the impression that taxpayers contribute to the unemployment fund. They do not. Companies do. The supplemental pay we recieve is a sort of savings account for us. If you had read the other posts before you spouted off, you might have learned something. It seems that most of the people complaining about all this GM hoopla don't even work there; and those of us who do and will be directly impacted by a layoff aren't complaining at all. Interesting.

khulburt
May 24, 2008 at 10:34 a.m.
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that is because gm pays more towards are unemployment than other employers. there for we get the maximum. dont worry the tax payer is not paying for the upgrade. and our sub pay is negotiated into our contract by the union wich general motors agreed to. was this not covered in many of the blogs about gm before?

opinion80
May 24, 2008 at 9:59 a.m.
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Again, I have to ask, how is it a GM worker can draw the full amount available from state unemployment while receiving money from another source each week as well? If the people that get laid off have saved their money for situations like this, kudos to them but if they have not saved their own money to get them thru a lay-off, why should they be able to draw money from a fund that everyone contributes to and not have to claim it as income each week when asking the state to send them an unemployment check? Anyone else drawing unemployment from the state has to claim what money they earn each week and risk their unemployment being cut.
If GM workers are making 50-70K a year, what are they doing with all of their money? Try saving some of it. If you want to go to school, try paying for it yourself like most of the rest of the people in this country that are trying to improve themselves and secure long term employment. Welcome to reality folks!

garyprimer
May 23, 2008 at 9:08 p.m.
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You asked for it, so... I think that you meant to say bring down the morale of the affected employees at GM. Sorry, I'm just trying to help avoid any confusion. If you were truly concerned about the lowering of morals, I apologize.

acejd93
May 23, 2008 at 5:38 p.m.
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Hey, Home Depot has plywood on sale, GM should stock up now to board up the windows if Woody's rumor is true. Mabee the unskilled, uneducated people down here can help since we can't do anything else. Before accusing us of being stupid, mabee you should ask what kind of people work there. Sure, some have no education, but ALOT of people hold degrees in several fields, nursing, accounting, engineering, teaching, mechanics, etc... Think about it, average pay for most of those fields is alot less than what they make at GM, so the smart thing to do is go where the money is and they still have things to fall back on when the ship sinks! It gets very disturbing on how many people bash GM employees and how far off topic these comments get. The employees did nothing to you other than bring a good living and money to the local economy where most of you recieve a little piece of the pie because of that. Janesville will survive without GM but not thrive like it once did! Now, you can criticize my comments, bash me for sticking up, analyze my spelling and grammar but take a look in the mirror and ask what can I do to help rather than make things worse and bring down the morals of the effected employees at GM, Lear and LSI. Like it or not, it'll be a ripple effect felt all over.

woody
May 23, 2008 at 4:13 p.m.
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Right now I'm concerned about what GM is doing as a whole. Today GM stock closed at $17.60 which puts its market cap at 9.96 billion. That IS what the company is worth (shares x price). GM lost more in the first quarter than it's worth. If GM goes bankrupt the retirees will lose the pension supplement. Delphi pensions were held up by GM, but, when GM goes down, who will guarantee the pensions? The gov will help you for pennies on the dollar. Ask some Beloit Corp retirees how much they are getting. One told me he is getting $300 a month. That's not much for a lifes work. I feel for every single person out there that loses a job.

papagrande
May 23, 2008 at 3:50 p.m.
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opinionsforfree, before you start calling GM workers uneducated, you should learn to spell. (repeative?)

RUSerious
May 23, 2008 at 3:46 p.m.
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Sorry woody-I should have said "Dancing on the deathbed..." But don't forget-this patient has gotten out of that bed before.
On the other hand, it could happen, I'm a realist, too. But they offered my grandpa a trip to Detroit (complete with job) for the same reason decades ago. Why don't we wait and see? Meantime, those who are sick of the articles will just have to avoid them. It's so easy to do. That news means a lot to many others, so those unaffected cannot expect it to be less important (locally) than the baseball games that will be making endless news coverage.

woody
May 23, 2008 at 3:32 p.m.
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RU: My comment before was based on something a certain seventh level supervisor said at a meeting in the plant. He said "if things don't change, Janesville will close January first". I'm not dancing on graves...I'm being a realist because unless you can make the fuel prices go down below $2 a gallon and bring back peoples good paying jobs to the US, I don't think things are going to change.

jtmek
May 23, 2008 at 3:28 p.m.
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Opinions, are you saying that GM workers don't work hard? Have you tried working there? It is a very boring, repitative job. Do that same thing hour after hour 50+ times an hour. I have never worked there but my husband does. You are paid well for the boredom you endure.

Or are you jealous of the pay that was negotiated by the UAW and okayed by GM?

I have a 4 yr. college degree and don't even make what my husband makes, but that's fine. Every job is different. It's not that big of a deal.

The buyout is not that great of a deal either. Those taking the 140K are giving up there health insurance. Let's see how far that money takes them if they don't get another job with insurance quickly!

RUSerious
May 23, 2008 at 3:16 p.m.
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zoom-You are right, I know that, and believe I may have referred to them as trolls very early on. I guess maybe I am speaking more to those who are affected more than to the trolls themselves. I don't even think they have enough perception of the issue (or much else, apparently) to understand-and of course nothing would make them care about anyone who had one more nickel in their pockets than they do. The only thing I wonder about them is why they do continue to read and post to articles they claim to hate seeing in print....but of course-that is the whole basis of trollism so it's like speaking to a rock. Nothing more important to do with their time.
Thank you BeenThereDoneThat-and I agree about roses4me. I wish roses (and beenthere's fiance)-and all their other hard working and deserving counterparts the best of luck and wishes for a good future, as well as those from other affected industries. They have worked hard and deserve credit for that. The fact that they won't all get the same departing benefits (or at least comparable to what they were earning) is, of course, no fault of any of those same workers.
Watch now, zoom, I am not even going to comment on onionsforfree's latest (2:36 PM) comment-even he/she/it knows how stupid THAT sounded.

Opinionsforfree
May 23, 2008 at 2:36 p.m.
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Well Uneducated and unskilled people shouldn't make that much money or be treated the way GM workers are. It will be interesting to watch the unskilled un uducated go to school or work their way though a career. I live very comfortably, but I worked hard and went though some tight times to get where I am today. No I am not jealous of any GM worker doing a mindless repeative job.

attorneyatlarge
May 23, 2008 at 1:33 p.m.
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Roses, smart, smart,smart.
You know how many college students would LOVE to be in your shoes right now... having TAA assistance to PAY you to attend class, PLUS tuition and books paid for?
Free higher education- no sweeter deal than that!!
(PS...I'd recommend becoming a legal assistant part time, then taking paralegal classes... you might see that a paralegal is not a huge step up from an assistant... but, there's always law school)

Purrmaid
May 23, 2008 at 1:27 p.m.
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roses4me has the right mindset: assess the situation, weigh your options, determine a goal and move forward. Major emphasis on moving FORWARD. So many are acting as if they stagnate and complain loud enough about the unfairness of it all, or avoid/ignore it long enough, a miracle will occur.

Purrmaid
May 23, 2008 at 1:19 p.m.
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As a Cash Buyout comparison for someone with 10 years or less, Sprint offered two weeks pay for each year you've worked and a $1,000 signing bonus as their severence package. Assuming a person worked ten years (x 2 weeks = 20 weeks) the GM lump sum of $70,000 divided by the same 20 weeks equates to $3,500 per week. Before or after taxes, the amount is still very charitable in comparison. I am thoroughly amazed the employees are expecting so much more.

Zoom
May 23, 2008 at 1:05 p.m.
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Sounds like a good plan roses4me. And before people start flaming, remember that regular unemployment is funded by GM, not personal taxes.

Zoom
May 23, 2008 at 12:58 p.m.
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RU,
...see my comment to momof5 about feeding the trolls. You have been sucked in...

I would argue that a GM workers dedication has already been rewarded with above average pay and benefits. The buyout option is a gift, in my opinion, when compared to what LSI and Lear employees will get (nothing). In all this though, I find no fault with GM workers. GM upper management is another issue.

roses4me
May 23, 2008 at 12:56 p.m.
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I have seven years seniority at the plant; and, last time I checked only 68 people had less seniority than I (I'm sure that number is lower now). I didn't take the buyout, and here's why:
1) The $70,000 lump sum pay off would have been less than $50,000 after taxes, which is less than one year's wage even when I'm laid off in July.
2) The supplemental pay we recieve when we're laid off is funded by the employees. Without it, we'd actually be earning more money per hour than we do. The company takes the extra money & puts it into an account, like a community savings account, for all the houly employees in the event of a layoff.
3) Benefits (medical insurance) continue for 13 months after the layoff begins.
4) I plan to go back to college while I'm laid off, become a paralegal, and quit GM. Meanwhile, I'll have unemployment, sup-pay, and benefits for at least half of the time I'm in school.

BeenThereDoneThat
May 23, 2008 at 12:48 p.m.
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RUSerious, thank you! You've said very eloquently what I've been trying to say for weeks to people who choose to berate me over these GM issues when they see me out in public wearing (proudly) my fiance's GM jacket. He's a "95-er" and has worked hard down at the plant for more than 13 years. I'll have to remember some of the points you make, should I need to use them again.

Zoom
May 23, 2008 at 12:46 p.m.
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momof5,
...and by commenting about posts that irritate you, you give attention to the poster, and only encourage more irritating posts. When will you learn to stop feeding the trolls?

To the rest of your comment...I would imagine that change is hard for many people, especially those you mention with 10+ years of service. I suspect many are hoping the large SUV market will turn around in the next few years, and are willing to wait it out in the job bank if required. An analysis of who takes the buyout would be interesting.

RUSerious
May 23, 2008 at 12:42 p.m.
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woody and opinions: Didn’t I see you dancing on some graves at the cemetery just recently? Your glee at your assuming the loss of livelihood of so many families astounds me. You complain about its constant presence in our local news, yet you can’t leave it alone. Why? It would be so fascinating to me to really know that. Is it someone in particular you hate, or do you just resent any large group of individuals who have, up to this point, done well for themselves-a large, diverse group of individuals who, through whatever circumstances, found themselves at our local GM plant? How can you be so disdainful of such a dramatic event in people’s lives? Have you no lives that you think the lives of others are a joking matter? Haven't had it so good yourselves? You'll probably never know how many of these workers (and others in the community who could) have done much to make sure less fortunate individuals had what they needed in many ways, shapes, and forms.
momof5: I suspect you are correct for the people with the lowest seniority. But for those who have invested much time (although it was only available to those with a minimum of 10 years-which is really quite a chunk of time) the loss of insurance for what is really less than 2 years pay in one lump is not necessarily a sound bet-because it sounds like they might be getting some pay for those 2 years if they stay anyway. In either case, I imagine it was an agonizing decision, and sympathize with those who had to make it. I believe the after tax figure might be more like $90,000. For those who think it would be easy to decide whether or not to take such a seemingly fantastic sum-remember, the time they’ve invested so far has been 10 years up to more than 30 (for those who take the retirement option). Dedication to their workplace should be rewarded with more than a c’ya.

momof5
May 23, 2008 at 11:55 a.m.
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Jackson: Your redundant postings get VERY old VERY quick.
.
I am actually shocked to see the number so low. If I had 10+ years, wasn't close to retirement eligibility and therefore on the bubble of potentially being indefinitely laid off, I'd take the buy-out. The top buy-out option was 140k. Granted (you) would also be agreeing to sever all ties with General Motors. Albeit, 140k (before tax) is a lot of money. Even at $28/hour for 40 hours, the average person would be receiving just over 110k (before tax and including UEC benefits and sub pay) for their 2 eligible years. The buyout is clearly the better option for SOME employees. To not be better, GM would have to go back to working 50 hour work weeks for 90.9 weeks out of 104 weeks (2 years). That hasn't happened in over 2 years, folks.

Opinionsforfree
May 23, 2008 at 11:53 a.m.
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Woody That is a great Idea. I have to agree

woody
May 23, 2008 at 11:49 a.m.
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Rock county should just wait 12 months so they could pool their resources together and have a water park, parking ramp, pool, PE center etc. at the Old GM plant. There would be plenty of room for everybody. It even has that cool access road that leads to the interstate that the taxpayer paid for.

Zoom
May 23, 2008 at 11:05 a.m.
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oops..."buyout"

Zoom
May 23, 2008 at 11:05 a.m.
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It would be interesting to know how many taking the butout were at risk of being laid off, and how many just took it for the cash or to retire.

RUSerious
May 23, 2008 at 10:43 a.m.
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I believe it's too late to reconsider the buyout-but apparently the number who did take it did not catch them off guard-it was about what they'd projected-and just about the same number as last time-25%. Hopefully, those people have a plan of action that will benefit their lives, and the rest will go on as usual. I'm sure most, especially those with families and much time invested, will not have taken this step lightly.

RUSerious
May 23, 2008 at 10:26 a.m.
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Zoom, if I understand your question correctly, your first thought was correct. The article says "Whether or not GM will need to layoff 756 people will be determined AFTER plant and union representatives see the final numbers from the attrition program." I imagine the final number will be whatever it takes to get down to one shift.

RUSerious
May 23, 2008 at 10:15 a.m.
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And look who were the first two pulling up lawnchairs & buying popcorn! You've been waiting at the door, haven't you? You did know you have to actually open the article to comment, didn't you?

Zoom
May 23, 2008 at 10:12 a.m.
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I was under the impression that the 756 layoff estimate was BEFORE people took buyouts/retirements, so the impact wouldn't be that bad. This article suggests that the 756 was an estimate of layoffs AFTER the buyouts. Could someone clear this up?

Purrmaid
May 23, 2008 at 9:47 a.m.
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Pulling up my lawn chair next to Opinionsforfree. Now if we just had some popcorn....

Opinionsforfree
May 23, 2008 at 9:26 a.m.
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Ahh another GM article. Let the drama begin

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