Mar 13, 2006
On March 7, GM announced a freeze on white-collar workers’ current pension plans. GM will no longer pay defined benefits. Instead they will shift to defined contributions, a 401(k) type of plan. The same 401(k) deal that so many workers lost their shirts on a few years ago!
In other words, workers no longer will gain credits toward a set guaranteed pension. They will have only a savings account that they will have to draw down in retirement.
GM is directly attacking salaried workers – but it has someone else in its sights: hourly workers. The UAW’s contract expires in late 2007. GM is setting the stage to demand big changes and give-backs from the hourly ranks as well.
Moving at this time also helps GM hold a threat over the heads of workers eligible to retire or take buy-outs before the contract expires. GM is clearly saying to these workers: get out now while you still have what you have. It’s part of their program to force high-seniority, high-wage workers off the books.
But workers will also see GM’s other message quite clearly. How can you trust anything GM promises? They tell you one thing one day and then change it the next. How can you retire based on false and deceptive promises?
Every worker knows that GM is the bear that isn’t satisfied until it takes the last drop of honey from the bees that produce it.