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Business Title: GM Says It'll Pay Hourly Workers Bonuses Topping $4,000 General Motors said it expects to pay its 45,000 U.S. hourly workers more than $4,000 each as a share of the company’s first annual profit since 2004. The average payout more than doubles the $1,775 record amount GM distributed after 1999. Another 3,000 hourly workers from former Delphi parts plants controlled by GM will receive more than $3,000 each, GM said today. The post-bankruptcy company plans to join Chrysler and Ford in awarding 2010 bonuses to both hourly and salaried workers, as the automakers start to reap rewards of years of restructuring. Ford, which made a profit of $6.6 billion in 2010, already said it is paying $5,000 to its UAW-represented workers. Chrysler is giving an average of $750 to hourly workers, despite its net loss of $652 million in 2010. The UAW notified its local chairs and presidents about GM’s profit-sharing estimate this morning, said Joe Ashton, who heads the UAW’s GM department. “Four thousand and a little bit above should make our members happy,” Ashton said. “Ours traditionally hasn’t been there.” In years past, Chrysler’s and Ford’s profit-sharing payouts have been several thousand dollars above GM’s. For instance, when GM’s workers got the record-setting $1,775 after 1999, Ford’s hourly employees received an average of $8,000 each, and Chrysler paid each worker $8,100. In other years, GM workers got as low as $50. The more substantial payment should satisfy workers, even though it’s below the amount Ford’s workers received, Ashton said. The day before announcing its worker payout, Ford decided to add another couple thousand dollars beyond the amount dictated by its profit-sharing formula, taking the average payment to $5,000. But GM isn’t adding any extra cash to the $4,000-plus payments its formula dictated, Ashton said. Negotiations for new UAW contracts with the Detroit 3 start in earnest this summer, and those could include changes to the profit-sharing formula, he said. The UAW may also bring up the salaried bonuses GM gives to employees when it reaches profitability goals, Ashton said. “We’re looking at equity” between salaried and hourly workers, he said. GM last week said it would pay bonuses to its 28,000 U.S. salaried workers, since the company exceeded 2010 targets for cash flow, profits and global market share by about 50%. Taking account for that extra 50%, most salaried workers will receive between 6% and 23% of their base salary in bonuses, although the final amount is up to the worker’s manager, GM said today. Less than 1% of white-collar employees will receive bonuses of 73% or more of their base annual pay. Next year, vehicle quality will also be part of the bonus formula, GM said.
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