Wednesday, March 3, 2010

Toyota pays a final, sad bribe to United Auto Workers at Fremont's NUMMI plant(TM)

Prepare to vomit.

Toyota North America just announced that they will contribute $250million in extra bonuses to UAW employees at the NUMMI auto plant in Fremont, CA. That's above and beyond the SALARY they're being paid in these final months. It's practically a bribe to keep these people from burning the place to the ground:

"Toyota appreciates all federal, state and local efforts to help NUMMI team members, who have shown great dedication over many years," said Mr. Wiseman. "The support we are providing to NUMMI underscores our commitment to do our part. It is unfortunate that neither GM -- NUMMI's other 50 percent shareholder and customer for 25 years -- nor Motors Liquidation Company, its current shareholder, has indicated that it will do the same, despite the fact that NUMMI team members have produced more than one million vehicles for GM."
Mr. Wiseman continued: "Toyota's decision to end its production contract with NUMMI as of April 1 was difficult but necessary, given GM's abandonment of NUMMI, which severely undermined the economic viability of the plant. Regrettably, our decision is final. Looking ahead, Toyota remains strongly committed to maintaining a substantial manufacturing presence in the U.S. and will continue to employ thousands of people in California."
The above referenced "federal state and local efforts to help NUMMI team members" includes some noble goals, like job training for transitions to new industries.
The part that is bizarre is last November's decision by Secretary of Labor Hilda Solis to grant NUMMI employees access to Trade Adjustment Assistance. This assistance is designed to blunt the impact of foreign competition on American workers. Solis apparently forgot that NUMMI is a joint venture with General Motors and Toyota (well until GM quit the JV a few months ago...), and as far as I know General Motors is not a foreign company.
Part of the Trade Adjustment Assistance is $12,000 over two years for the Re-employment Trade Adjustment Assistance (RTAA). This adjustment gives employees extra money to compensate for their new smaller salary at their new job. If you made $80,000 at your previous UAW job and now make $50,000, you can get up to $6,000 per year to reduce the impact of the lower salary. The effect is that at your new job, the person next to you doing the exact same thing will make less money than you, but a portion of their taxes will go directly to subsidize your higher salary.
Copyright 2010 AlphaNinja

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