GM changes salaried retirement benefits

[Bozita]

http://today.reuters.com/business/newsarticle.aspx?type=ousiv&storyID=2006-03-07T163001Z_01_WEN2300_RTRIDST_0_BUSINESSPRO-AUTOS-GM-DC.XML

GM changes salaried retirement benefits
Tue Mar 7, 2006 11:29 AM ET


DETROIT (Reuters) - General Motors Corp. <GM.N> on Tuesday said it would freeze accrued pension benefits for U.S. salaried employees and begin a shift toward a "broader reliance" on defined contribution plans, in a move that will cut its year-end 2006 pension liability by about $1.6 billion.

The world's largest automaker expects the changes to reduce its pre-tax pension expense by about $420 million in 2007. Additional 401(K) contributions it will make for employees hired after January 1, 2001, are expected to rise by about $15 million.

GM also expects to record a pre-tax charge of about $120 million on remeasurement of its long-term pension liability. Assuming the remeasurement occurs by the end of March, GM expects to realize about 75 percent of the expense reduction in 2006.

[napi21]

1. Soon all defined pension plans will be history!

There are VERY FEW remaining, even now. I HATE the idea, but if all other companies switch to 401(k) plans, a hand full of companies simply cannot compete and still retain the defined plans.

[Sammy Pepys]

2. Yeah, pensions are expensive.....n/t

....

[merwin]

3. kick

[Bozita]

4. 42,000 at GM to have their pensions cut (Who's next?)

The link provides a short, easy-to-understand recap.

http://freep.com/apps/pbcs.dll/article?AID=2006603080339&template=printart

42,000 at GM to have their pensions cut

Automaker says huge loss in 2005 forced changes

BY MICHAEL ELLIS
FREE PRESS BUSINESS WRITER

March 8, 2006


After decades of giving its U.S. salaried employees generous pensions, General Motors Corp. announced a sweeping change in direction Tuesday that will place more of the burden on workers to save for their retirement.

The changes are the latest hit to benefits for GM's 42,000 salaried workers who have already been forced to pay more for health care while losing other perks such as tuition reimbursement.

GM said it must make the change as part of its efforts to reverse last year's $8.6-billion loss.

Following the lead of many other companies, such as Ford Motor Co., that have cut pensions, GM said that newer employees will see the biggest change.

more ...

[Dem Agog]

5. I got a job offer this past week with a pension included in the package.

Took everything I had not to laugh in the HR person's face. "Yeah, like I trust you to really give me the money you say you will in X number of years."

[caligirl]

6. If the SEIU has anything to say the next one will be Carly Fiorina's

outragous severance pkg. The HP board broke one of their own rules to make her filthy rich after screwing up the company. Funny thing is David Hewlitt fought hard against her being hired in the first place.

""You have a situation where the board made a commitment to the shareholders and adopted a policy in response to the clear majority of the shareholders," said lawyer Michael Barry, who represents the pension funds. "Now, they're turning their back on that and with impunity just disregarding it.""http://sfgate.com/cgi-bin/article.cgi?f=/c/a/2006/03/08/BUG8QHK6S01.DTL

[ReadTomPaine]

7. She had GOP backing, they were grooming her for a DiFi challenge..

and giving her a high profile SV job was part of that package. Fortunately, HP's woes and other issues derailed this.

Here's Carly with friends;

[caligirl]

11. Are you serious?

[ReadTomPaine]

12. 100% - Look at this quote from Biz Week:

"Her public support of President George W. Bush and her work on California Governor Arnold Schwarzenegger's transition team have led to open speculation inside HP that Fiorina is positioning herself for an Administration appointment or a run for the U.S. Senate -- perhaps a 2006 race against Democratic Senator Dianne Feinstein. She demonstrated her political skills by pushing through the Compaq acquisition, the largest deal in computer history, over fervent and well-funded opposition. And her quick integration of the two companies exceeded even the expectations of her supporters."

http://www.businessweek.com/@@bL3JaoYQ9L4SUwAA/magazine/content/04_50/b3912001_mz001.htm

They had big plans for Carly.

[caligirl]

13. I feel so ignorant now. holy c.........

[Skink]

8. I like my 401k but they shouldn't be able to reneg on their obligations

[LeftHander]

9. Punish employees for poor managment...

Excellent....

Let me guess...GM execs get a bonus?

[ReadTomPaine]

10. Of course - they slashed costs right?

Well.. they slashed something.