GM will end 'jobs bank' program

NEW YORK --- General Motors Corp.'s "jobs bank" program will end Monday, after a similar move at Chrysler LLC that helps satisfy the conditions the government imposed when it lent the automakers $17.4 billion late last year.


The program gives union workers at the Detroit Three most of their pay and benefits while they are laid off -- sometimes for years. It was the target of much ire during the companies' requests for a federal bailout.

GM spokesman Tony Sapienza said Wednesday that the 1,600 GM workers in the jobs bank will be placed on layoff and will need to file for unemployment. They will receive about 72 percent of their salaries, paid by state unemployment benefits and GM subsidies. The workers also will get medical and other benefits from the company.

The length of time workers can receive unemployment benefits varies from state to state but usually amounts to about 48 weeks, Mr. Sapienza said. After that, they will no longer get paid.

Christine Moroski, a spokeswoman for the United Auto Workers union, declined to comment.

Mr. Sapienza said the move will allow cash-strapped GM to use state unemployment benefits to help cover some of the costs of paying the workers.

UAW President Ron Gettelfinger said in early December that the union would suspend the jobs bank, after members of Congress criticized the automakers for paying workers not on the job. Some Republicans sought more concessions from the union, and a bill to provide loans to GM and Chrysler died in the Senate before the Bush administration stepped in to grant aid.

Each automaker's jobs bank varies, but at GM, laid-off workers could get 85 percent of their base pay, plus benefits, without reporting to work while the company tried to find them jobs elsewhere. Or workers could get full pay by reporting to a factory or union hall, where they could be asked to perform community service or tasks around the plant.