GM Tells Union It Won't Pay Workers to Leave

General Motors Co. has told the United Auto Workers it will no longer pay union employees to leave the company, a reversal for an auto maker that has spent billions of dollars over the years coaxing workers to quit, reported The Wall Street Journal.

The UAW has been pressing GM to consider another round of buyouts and retirement incentives similar to programs that ushered out 66,000 hourly workers since 2006. But in a recent meeting with union-local leaders, top UAW officials said GM has indicated it has no intention of extending such a program, according to several officials who attended.

Union concessions made in recent years along with GM's improving sales mean the company no longer needs early-retirement programs and buyout incentives to cut costs.

The change puts the union in the unusual position of trying to convince the company to clear out more workers. If GM doesn't thin its ranks, scores of veteran factory workers in the next few years will find themselves without jobs or unemployment benefits.

Laid-off factory workers once could remain on GM's payroll for years receiving almost full pay and benefits, but now they can remain on the rolls no longer than two years before their company-paid unemployement benefits run out. The change came from a deal GM struck with the union last year before entering bankruptcy protection.

The agreement also gives GM more flexibilty to move workers around the country to fill openings as they arise, reducing the need to the company to hire new employees.

At the same time, a leaner GM, after years of shutting factories, is racing to add capacity to meet growing demand for some of its vehicles. Hundreds of workers back are back on the job as the company has added shifts and overtime at several North American factories.

A UAW spokesperson couldn't be immediately reached for comment.

GM spokeswoman Kim Carpenter said that rather than launching a new buyout program, GM will use flexibility allowed under its UAW contract to adjust manpower up and down. In addition to being able to move workers more freely from plant to plant, GM can hire temporary labor to meet short-term needs.

In the 10 months since GM emerged from its government-financed bankruptcy, the car maker says it has restored or created 9,100 jobs and invested $2.3 billion in U.S. and Canadian factories.

GM has around 5,000 laid-off workers receiving benefits. Along with the cost of those workers, GM also has been unable hire new workers at a lower wage agreed to by the UAW because the laid-off veterans have first dibs on any new jobs, and they would return at the higher pay scale.