You may recall that back in December, 2013, Holden made the announcement that it would be ceasing all production in the country of Australia by 2017. One nagging detail of the plant closures – that of severance pay to the more than 6,000 employees affected – has now been put to rest.
About 80 percent of Holden’s workforce supported the severance deals, according to an article published by Australian news site Adelaide Now. The Australian Manufacturing Workers Union has learned from a similar closure in Adelaide, Australia that occurred in 2008, wherein workers who voluntarily left a Mitsubishi manufacturing plant prior to its closure would receive no severance.
As a result, the vast majority of workers stayed on until the end, flooding the job market when they were all cut loose at once. To avoid a repeat, those who voluntarily leave Holden between now and the 2017 closure can still qualify for a severance package equal to 3.5 weeks’ pay per year of service. Those who continue to work will see a three percent pay raise in 2015, and again in 2016, as well as severance equal to 4 weeks’ pay per year of service.
“Our overriding goal is to support a long and orderly transition of our employees and give our people the best possible chance of securing a successful future,” said a Holden spokeswoman. Adelaide Now has reported that between Holden’s supply chain and its own workforce, approximately 13,000 jobs are expected to be lost due to the closure.
Comments
I love it when union leaders insist that they are good bargainers. What would the union have done if GM offered them nothing? Strike outside the closed plans?
If the union were good bargainers they would have negotiated lower labor cost so the jobs would not be lost. A union rep here in the states always said, a laid off worker does not vote but a worker with a pay cut does. It is about job preservation of the union bosses
I cannot imagine that negotiating pay cuts is a strategy for success, for the owner as well as the worker. The labour component of auto assembly has remained at a virtually constant 7% since the mid-fifties; it costs more to dry the paint than it does to assemble a vehicle. Of greater concern is the answer to the question, “Who will buy a Holden in Australia, knowing that the manufacturing has been moved off-shore?”. From my perspective, here in Canada, it looks as though they are shooting themselves in the foot.