GM and Chrysler Will Pay Bonuses to White-Collar Workers


Less than two years after they exited bankruptcy, Chrysler Group and General Motors (GM) will soon distribute bonus payments to salaried employees in recognition of their efforts to help revive the once-flagging Detroit automakers.

About 26,000 white-collar workers at General Motors will see performance bonuses of 4% to 16% of their base salaries, the company said late Thursday, but a small group could see payments that are equal to as much as 50%.

In its statement, GM said the payments would be based on each employee's performance and that of the company's, but would not give an average for the payments. A GM spokesman declined to comment further, Bloomberg News reported.

Chrysler, meanwhile, may pay its bonuses to its salaried staff as early as Friday. The amounts to be paid to the Auburn Hills, Mich.-based company's nearly 11,000 salary workers will average about $10,000, Bloomberg reported.

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As with GM, a small number could receive bonuses as large as half their base salaries, the news agency reported, citing people familiar with the matter.

The payments are likely to anger unionized workers at the two automakers, Gary Chaison, professor of industrial relations at Clark University in Worcester, Mass., told Bloomberg. "If these kinds of bonuses are paid to salaried workers, then the union's demands will increase, knowing management can't claim an inability to pay."

Late last month, Chrysler said union workers would receive bonuses totaling $750 each. The amount was based on the $850 million in operating profit Chrysler earned last year. After accounting for interest and other charges, the automaker actually lost lost $652 million in 2010.

Union workers at GM are expected to receive payments of about $3,000 each, equal to about 5% of the workers' pay, Bloomberg reported.

GM and Chrysler were both recipients of billions of dollars in federal government loans under of the Troubled Asset Relief Program, which restricts what they can pay to their top executives.

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