Delphi works on new proposal

The UAW said it is prepared to strike if the pay-cut plan isn't withdrawn.
STAFF/WIRE REPORTS
Delphi Corp. is working on a new pay proposal for the United Auto Workers.
Steve Miller, Delphi chief executive, told The Wall Street Journal that he is "starting with a whole-cloth new deal, a new solution" to try to negotiate a labor deal that would lower the auto supplier's costs. He didn't provide details.
Delphi's first two pay proposals have been disregarded by the UAW, which represents most of Delphi's hourly workers.
Ron Gettelfinger, UAW president, said last week that the union was prepared to strike if the pay-cut proposal isn't withdrawn.
About 3,800 Delphi workers in the Mahoning Valley are represented by the International Union of Electrical Workers, which hasn't commented recently on Delphi's cost-cutting efforts. The IUE, however, has asked for financial information from Delphi before presenting a counteroffer.
Wage cuts
Shortly after filing for bankruptcy protection in October, Delphi proposed cutting production workers' hourly pay from $27 to $10. Later the company revised that to $12.50.
Miller told the Journal that he would consider a new wage plan now that General Motors Corp., Delphi's former parent company, has shown its "positive indication that they will participate in our efforts." GM said it would forgo scheduled price cuts for products it buys from Delphi starting Jan. 1.
Miller said the new plan would be a three-way deal among GM, the UAW and Delphi.
Gettelfinger told the newspaper that he also wanted Delphi to retract the "obscene" executive-retention proposal that is pending in bankruptcy court.
Miller said he was willing to accept a less lucrative plan than the one that's been proposed.
"We are confident we will end up with an employee-compensation program, even if it's not exactly what we have proposed now," he said.
In addition to the unions, Delphi's bondholders and the federal agency that insures pensions have opposed the plan.
Lucrative plan
The Journal called the current proposal one of the most lucrative retention plans ever proposed in bankruptcy court. The plan seeks to set aside $518.5 million in cash bonuses, severance packages and future stock for 600 employees.
Kmart Corp. sought $150 million for 9,500 midlevel executives and managers, and WorldCom set aside $25 million for 325 senior managers.
In other news, the newspaper said the UAW and Ford Motor Co. have come to terms on a health-care agreement that will help the automaker cut costs. No details were released.
In October, the UAW negotiated an agreement with GM, which calls for union members to give up some scheduled pay raises to help pay for retirees' health care. The retirees are to begin paying more of their health-care costs.