GM rescinds pay cuts to its salaried workers

DETROIT FREE PRESS

DETROIT — General Motors told white-collar workers Friday morning that it is restoring temporary pay cuts made May 1.

The 3 percent to 10 percent pay cuts to salaried workers’ pay came at a time when GM was desperate to save cash to keep the company operating prior to filing bankruptcy June 1.

“In recognition of all your sacrifices and commitment, we have determined that it is appropriate for base pay to be restored effective Sept. 1,” said Mary Barra, GM vice president of global human resources, in an e-mail obtained by the Detroit Free Press.

Brenda Rios, a GM spokeswoman, confirmed the decision and noted that it saved about $50 million.

“This was done to save money at a particularly crucial time,” Rios said.

She added: “We always said it was temporary.”

GM benchmarked its salaries with other companies and found that its pay was competitive, she said. “These are the employees who are going to carry the company forward, so you want people here who are committed and motivated,” Rios said.

The pay cuts depended upon an employee’s level. Executive-level employees saw a 10 percent cut.

Friday’s announcement does not affect the pay cuts made to the company’s top-level executives who saw their pay reduced because of federal loans given to keep the company afloat.

In addition, salaried workers have seen an elimination of 401(k) matches, an elimination of pay raises and health care cost increases.

“We appreciate the sacrifices you have made during this historic transformation and appreciate your continued efforts as we build a successful new General Motors,” Barra wrote.