Chrysler prepares for recovery by offering worker buyouts — Business Management Daily: Free Reports on Human Resources, Employment Law, Office Management, Office Communication, Office Technology and Small Business Tax Business Management Daily
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Chrysler prepares for recovery by offering worker buyouts

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The cost of retirement benefits are one of the flies in the ointment of Chrysler’s plan to close eight plants—including its Twinsburg, Ohio, stamping facility. To help cut long-term expenses, the bankrupt company plans to offer lump-sum buyout payments to some members of the United Auto Workers.

In late May, some Chrysler workers were offered $115,000 plus a $25,000 vehicle voucher to forgo their pensions. Workers age 49 or younger with at least 10 years of seniority were eligible.

Workers whose age and years of service total more than 85 were eligible to receive $50,000 and a $25,000 vehicle voucher.

Chrysler offered lower packages in January in an attempt to reduce its workforce to 26,000 from its current 29,500. Many of the workers eligible for the payments may be laid off in the coming months if auto sales continue to slide, and Chrysler fails to find a buyer.

After Chrysler filed for Chapter 11 bankruptcy in April, a federal judge approved the sale of Chrysler’s assets to Fiat in late May.

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