Delphi Corp. and the United Auto Workers union are talking about buyout packages to reduce the auto supplier’s hourly work force, a union official who has been briefed on the talks said Thursday.
The plan under discussion would mirror a buyout and early retirement pact negotiated in March between the UAW and General Motors Corp., Delphi’s former parent company, extending buyout offers that were made only to GM workers, said Clyde Sims, bargaining chairman for UAW Local 913 at a Delphi plant near Sandusky, Ohio.
Sims, who co-chaired the UAW’s national bargaining committee during the 2003 contract talks and sat at the table in 1999, said he was told about the Delphi negotiations by UAW officials in Detroit who are familiar with the talks.
GM workers with 10 or more years of seniority were offered $140,000 to leave the company with credit for their pension but no other benefits. Many with less than 10 years were offered $70,000. As part of the same agreement, Delphi workers were offered $35,000 lump-sum payments to retire, and 5,000 would be able to return to GM.
Extending an offer to Delphi workers who aren’t eligible to retire would entice more of them to leave and let Delphi define the size of its remaining manufacturing work force and then negotiate wages, Sims said.
Delphi is GM’s largest supplier and has sought Chapter 11 bankruptcy protection. It also has asked the federal bankruptcy court in New York for permission to void its union contracts so it can reduce wages. But the company and UAW officials have said they prefer a negotiated settlement to any action by the court.
“Everybody will have the opportunity to take the attrition package or flow back” to GM, Sims said. “There’ll be options for everybody, basically.”
UAW spokesman Paul Krell said he could not comment on the talks, and a Delphi spokesman has said the company would not comment while negotiations were under way. GM spokeswoman Toni Simonetti also said she couldn’t elaborate on the talks.
“I can tell you that discussions have been occurring and progress has been made,” she said. “I don’t know that there are actually specific agreements that have been reached.”
Bankruptcy Judge Robert Drain in New York was to hold a hearing Friday on Delphi’s move to void the contracts. But Krell said the hearing had been postponed due to the funeral for Henry Reichard, a leader of the International Union of Electronic Workers-Communications Workers of America and a key bargainer in the Delphi talks.
No new date has yet been set, Krell said.
Reichard died Monday night at his home north of Cincinnati.
The UAW, which represents most of Delphi’s 33,000 hourly workers, and Delphi’s five other unions, are fighting the request for permission to void the contracts.
UAW members have overwhelmingly authorized the union to call a strike if Delphi wins such a right. Analysts have said a strike could cripple GM’s production.
Delphi has proposed cutting wages from $27 an hour to $16.50, a plan that would require financial support from GM. Without a contribution from the automaker, Delphi has said it will only be able to pay employees $12.50 an hour.