More white collar lay-offs are underway in Michigan.
While GM is mired in fight with it’s bondholders over converting their debt to stock, the company is beginning to lay off salaried employees as part of its restructuring plan. The employees were selected based on a combination of performance, skills and seniority. In all, some 3,400 salaried employees are scheduled to leave the payroll by the end of April.
The first 160 employees were dismissed at the GM Technical Center in Warren, Michigan.
“It’s very difficult for the employees,” said a GM spokesman, who acknowledged that many of those tapped for layoff had elected to stick with the company through previous rounds of buyouts and cutbacks, going back to 2005. Employees with a minimum of 12 years service at GM are eligible for six months of severance.
GM is also now tallying how many blue-collar employees have agreed to retire early or accept a buyout, said GM spokesman Tom Wilkinson. The opportunity to accept early retirement expired Tuesday.
Meanwhile, there were no signs of progress in GM’s negotiations with both the UAW and bondholders. The negotiations with both are separate but are interconnected. GM is supposed to have negotiations with both the union and the bondholders complete by March 31.
In a related matter, the bankruptcy judge overseeing Delphi Corporation’s bankruptcy case also delayed approval of a deal that would allow the parts supplier sell its steering business to GM. Delphi requested the delay to give the Obama administration’s auto task force more time to review the deal.
The court delay, which stretches until the end of April, suggests the administration is prepared to give GM more time to complete work on the viability plan required under the terms of the bridge loan approved by the Bush administration just before Christmas.