STABILISING PLAN

Wanganui Chronicle, Volume 83, Issue 36, 13 February 1939, Page 10

STABILISING PLAN

WAGES OF WORKERS LEAN TIMES IN MOTOR PLANTS NEW YORK. Dec. 6. A scheme, intended to stabilise employment and protect employees in lean times, is announced by General Motors Corporation. Effective in the New Year, it will apply to 150,000 hourly-paid employees. A second scheme, to cover 37.000 salaried employees, is under consideration. For employees with live years oi more of service an "income security ’ arrangement will give to each at least 60 per cent, of his standard weekly earnings throughout the year. Fo*. employees of over two and under live years of service, a "lay-off benefit” plan will give to each at least 40 per cent of his standard weekly earnings up to a total amount equivalent ic 72 hours’ pay. The scheme does not involve the withholding of any, pay earned by the employee in a period of normal or above-normal employment, preceding a period of slack employment. On the contrary, it involves a financial contribution by the company in slack times, to be made up, when recovery occurs, by the employee refunding the loan out of half of his earnings in excess of the normal pay for 6i> per cent, ui a standard week. A reserve will be set up by the corporation io finance the two plans. The amount of the reserve will be a percentage of the payroll, the precise figure to be determined in the near future. This reserve will cover ihc losses sustained by the company, either in the event of the employees death, when his obligation to refund the company’s advance ceases, or in his failure to return to the company s employ. The loss by death will not be covered by outside insurance, since the problem is regarded as one of levelling employment conditions, rather than an actuarial one. Provision for Suspension The plans include the usual provision for their suspension, in case of fire, flood, war, riots, strikes, or other circumstances beyond the control of the corporation. Therefore, they would have been suspended during the sit-in strikes in Detroit early in 1937 had they been in effect then. The weekly guaranteed income wifi consist of: (a) Pay for the amount ui work performed for the corporation; (b) pay for any other regular employment; (c) unemployment compensalion, under State-administered laws, (d) an advance to be made by the corporation to insure a minimum weekly income of at least 60 per cent. When an employee’s weekly earnings exceed 60 per cent., he will repay advances at the rate of half the amount by which such earnings exceed 60 per cent. Should an employee die, his unymG advances would be cancelled. Supposing an eligible employee receives a basic wage of one dollar an hour, his standard weekly earnings will be 40 dollars. In case of a shutdown, he will continue to receive 60 per cent., or 24 dollars a week. When work is resumed at the standard rate, he will receive half the difference between 24 and 40 dollars, or 32 dollars, until the company’s advance has been repaid by his refund of eight dollars a week. If work advances to 48 hours a week, with time and a-half for overtime, the employee will receive 38 dollars weekly, in addition to paying the company 14 dollars a week until the loan has been paid off.