Isn't this a real bite in the ass. GM screwed all their Union and Salaried Retirees around so good they they can afford to give themselves more raises and bonuses. Where's Obama's Auto task Force now? They had GM cut Us to ribbons to stop the bleeding of their cash flow so they could reward them for it.Annual raises for salaried workers to return; two new executives namedRobert Snell and David Shepardson / The Detroit News
General Motors Co. is restoring merit pay for almost all salaried employees now that the automaker has stabilized its operations since emerging from bankruptcy with about $50 billion in federal aid.
The merit pay plan, which will be restored in February, is a modest annual cash raise that was suspended last year as GM teetered on the verge of bankruptcy. It is unclear exactly how much the merit pay plan will boost salaries, but it typically compensates for inflation and keeps workers competitive with peers at GM and rival companies, spokesman Tom Wilkinson said Wednesday.
"The good news is the company is now stable enough and back to normal enough that we can do this," Wilkinson said.
The disclosure came as Chairman and CEO Edward Whitacre Jr. solidified his senior leadership team Wednesday and announced he is replacing GM's top lobbyist in Washington. GM is replacing Ken W. Cole, who has been vice president for government relations since August 2001, with two former AT&T officials who have close ties to Whitacre, a former AT&T chairman and CEO.
Cole will remain as an adviser for the next few months until his retirement later in 2010, but his replacement starts Friday. Cole was deeply involved in GM's negotiations on Capitol Hill this year in an effort to head off legislation to prevent the closing of more than 1,300 dealerships.
Whitacre named John T. Montford, as GM's top lobbyist. He will serve as a senior adviser to Whitacre and have overall responsibility for government relations and global public policy.
Montford was most recently senior vice president-state legislative affairs for AT&T. Previously, he served as president of external affairs for Southwestern Bell. Following the merger of SBC and AT&T, he served as president-western region for AT&T.
Montford will be supported by Robert Ferguson, who was named GM's vice president, government relations. Ferguson was most recently a senior strategist for the business advisory firm of Public Strategies Inc. in Austin, Texas. Ferguson joined Public Strategies from AT&T, where he was president of state legislative and regulatory affairs.
"John and Bob are proven professionals who have worked in an environment of intense regulatory and political complexity," Whitacre said. "I've worked with both through a number of issues over the past several years, and they have my deep trust and respect. We thank Ken Cole for his years of service at GM and will continue to draw on his expertise over the coming months."
The moves are the latest major management change at GM since Whitacre replaced Fritz Henderson as CEO on Dec. 1 and are critical to massaging the relationship between the automaker and the U.S. government, its majority owner.
The merit pay move, meanwhile, does not affect GM's senior executives, whose compensation is established by Kenneth Feinberg, the U.S. Treasury Department's special master for compensation.
GM told salaried employees about the merit plan restoration before the holiday break earlier this month. The move comes after GM restored salaried and executive pay cuts in September for workers in the U.S., Canada and some foreign countries.
Those pay cuts were implemented in May and slashed executive base salaries 10 percent while many other workers saw cuts ranging from 3 percent to 7 percent.
Restoring merit pay can help retain talented workers, said auto analyst Joe Phillippi of AutoTrends Consulting Inc. in Short Hills, N.J.
"Given the number of departures they've had, particularly senior people taking retirements or buyouts, you run the risk of a lot of brain drain and losing institutional knowledge," Phillippi said. "That's very important with respect to engineering and vehicle launches."
http://www.detnews.com/article/20091231/AUTO01/912310354/1148/?source=nletter-business
