GM Holden Asks Workers for Pay Cut After 400 Laid Off

Some 400 manufacturing workers at GM Holden’s Elizabeth assembly plant have collected their final paychecks, but General Motors’ Australian subsidiary is having trouble finding enough volunteers for separation packages at the product- development center.

The center has a redundancy quota of 100, but Fairfax Media reports only 40 employees have expressed interest in the scheme, raising the prospect 60 workers could face forced layoffs.

GM Holden announced the staffing cuts in April as it moved to reduce its manufacturing workforce to 1,700 while cutting production to 335 vehicles a day from 400.

Australian Manufacturing Workers Union South Australian secretary John Camillo tells the newspaper forced redundancy is a distinct possibility for some Victoria staff.

“I don’t think they’ve reached their target, so Holden may be forced to look at forced redundancy,” he says. “That’s something for the Victorian unions and Holden to work out moving forward. If they need to get 100, they need to sit down and work out how they’re going to do it.”

Earlier, the AMWU expressed shock after opposition treasury spokesman Joe Hockey, speaking about further government support for GM Holden to remain in Australia, said there must come a time when enough is enough and governments need to think twice about throwing money at a single auto maker.

“At a time when Holden is considering its long-term future in Australia, it is shocking that a senior member of the Coalition would make such destabilizing comments,” AMWU National Secretary Paul Bastian says in a statement.

“We need the Coalition to commit to supporting the Australian automotive industry if they win this year’s election. Each of our major car plants is at the center of a web of suppliers and indirect workers that together number 200,000 employees. If we lose car manufacturing in Australia, many of these businesses will no longer be viable.”

Bastian says every auto-making country provides co-investment support to their industry: Australia gives A$18 ($16.68) per capita yearly, compared with the U.K.’s A$30 (£17.98); Canada, A$100 ($C91.97); the U.S., A$260 ($240.96); and Sweden, A$330 (€228.82).

“We also have some of the lowest automotive tariff protections in the world,” he says. “Comparatively, we get all the benefits of an automotive sector on the cheap.

“The last thing the Australian automotive industry needs is more uncertainty about future investment environments.”

GM Holden has asked staff to accept pay cuts of A$200 ($185.36) a week as part of a A$15 million ($13.9 million) cost-saving measure.

Camillo tells Fairfax Media he is confident targets drawn up by the unions will meet the savings requirement without a pay cut.

“At the moment, A$200 wage cuts and wage freezes is not a goer – about 90% of workers are against it,” he says. “Workers are saying they can’t live and can’t pay their mortgages with the $200 wage cut, and they may as well close the place down.”

GM Holden workers are to vote Aug. 9 on a contract variation endorsing the A$15 million in alternative cost-saving measures.

“I’m pretty confident that if the workers vote for these changes and flexibility, and there is ongoing government funding, then we’ll get to replace the Cruze and the Commodore and the Elizabeth plant operation will be around for another 10 or 12 years,” Camillo tells the newspaper.

“If they say no, Holden will not replace the Cruze and Commodore. It’s as simple as that.”