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GM to use bailout money to pay bonuses to 7,500 employees
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I think so. It is an incentive payment they would not have received otherwise.
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Is there something preventing GM from straight up terminating people due to the downturn in sales? Why the need for an incentive?
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I see what you're saying, but I do think it may be a little different here. For one, a bonus is usually a tool to retain an employee. It's something paid in excess of their wages and not used to eventually cut costs.
A buyout is used in lieu of continued employment, to get people to retire so that employment costs will allegedly fall. In GM's case, all the analysts seem to think GM has way too many employees, so to survive it needs to lay them off. If that's necessary to their survival, and the bailout was passed to help them survive, it seems like those to actions are consistent.
I see your point though. AIG [insert other favorite "evil" company of choice] needed to retain some employees who would have otherwise left to survive. So maybe the difference is whether the recipient is a blue-collar worker or white-collar management. If that's the case, I think you're right, there is no difference.
A buyout is used in lieu of continued employment, to get people to retire so that employment costs will allegedly fall. In GM's case, all the analysts seem to think GM has way too many employees, so to survive it needs to lay them off. If that's necessary to their survival, and the bailout was passed to help them survive, it seems like those to actions are consistent.
I see your point though. AIG [insert other favorite "evil" company of choice] needed to retain some employees who would have otherwise left to survive. So maybe the difference is whether the recipient is a blue-collar worker or white-collar management. If that's the case, I think you're right, there is no difference.
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I don't see that as bonuses at all, I see it as a way to reduce their workforce by offering a "package" more or less, seeking volunteers. They've doneso at my company several times. They put the offer on the table (usually 2 weeks for every year) and see how many employees will take it. They take this approach first, before forced layoffs.
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I would be inclined to take it if I worked there.
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I believe this buyout offer is to Union employees. Contracts with the Union are involved here. You need to know the details of the contract to know if this is good or bad. As I understand it, the company will save a lot more money with those that take the buyout. In addition, the people that take it are making their own decision and not being forced out of work.
This is not directed at over paid execs getting absurd golden parachutes.
This is not directed at over paid execs getting absurd golden parachutes.
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This is not the same thing as a bonus. If I were in manufacturing I would take the buyout. People were offered 3x as much 2 years ago. They are losing their job. The buyout gives them a cushion while they are looking for another job. Being in Michigan I know quite a bit about this. Previously they were offering an education package also.
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It's just a severance package.
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You are right. It is directed at overpaid line workers. But it is still our tax dollars.
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I'm guessing the severance is like a "pay in lieu of notice". I know with my job being terminated I received my written notice on March 5th that my position is terminated as of the 31st, but I will receive a payout in lieu of a longer notice period.
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They are not being laid off, they are choosing to leave with a package.
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I'm not exactly following your point here. If it reduces GM's payroll (and they couldn't otherwise lay them off) then isn't that a good thing in terms of furthering the goal of saving GM?
Would you be happier if they used it to buy raw materials and pumped out more cars so they could have an even more bloated inventory?
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You do follow the point. You just don't agree with it.
According to you these bonuses are a good thing because the people running GM think it will help further the goal of saving GM.
The people running AIG used retention bonuses as a tool to further the goal of saving AIG. This is bad, very bad, shameful, criminal, waste of taxpayer dollars. We should be outraged.
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They are not bonuses! It's a voluntary severence package. It's to help them stay on their feet while they look for a new job. What part of this don't you get?
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Ok, call it what you want. There is very little difference between this and the AIG payments [which were delayed severance packages; they had to agree to stay for a little while and then were out on the street]. The one minor difference I see is that GM employees were overpaid greedy union members while AIG employees were overpaid greedy executives. Both groups are benefitting courtesy of the American taxpayer.
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Oh, for the love of mike.
Did the GM line workers tank the company? The way the AIG dorks did??
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