GM to cut 4,000 more white-collar jobs by year end

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By Beth Boehne

Story Created: Jun 23, 2009 at 5:44 PM EST

Story Updated: Jun 23, 2009 at 5:44 PM EST

DETROIT (AP) — About 4,000 more salaried workers at General Motors Corp. will lose their jobs by the end of the year as the automaker continues to downsize.

The company notified its more than 27,000 U.S. white-collar workers by e-mail Tuesday that that it will offer standard severance packages, and employees near retirement age will have the opportunity to retire early, spokesman Tom Wilkinson said.

Some involuntary cuts will be necessary, Wilkinson said, as GM tries to shrink its U.S. salaried work force to around 23,500 by year's end.

The automaker is in Chapter 11 bankruptcy protection and has received about $20 billion in loans from the U.S. government. The Treasury Department's auto task force is overseeing its plans to restructure and emerge from bankruptcy as a leaner, more competitive company.

Wilkinson said the Treasury Department has approved the retirement offers and severance packages. He would not give an estimate of how much the packages will cost the company.

"We were able to do this because it's a cost-effective way to get these reductions," he said Tuesday.

GM already has reduced its salaried work force by more than 2,000 so far this year. The company started 2009 with about 29,650 workers, Wilkinson said.

Workers who agree to leave the company will get standard severance packages of two weeks' pay for every year of service, up to six months of pay, Wilkinson said. For those near retirement age, there are packages that will let them retire early with benefits, he said.

Involuntary cuts will be made based on performance, skills and length of service, Wilkinson said.

Workers have been told to reply to the latest offers by Aug. 3. The company plans to finalize who will be cut by Oct. 1, he said.

Cuts will vary by department, with some seeing fewer than others. For example, electric vehicle development, which the company is banking on for future sales, would be fewer cuts than other areas, Wilkinson said.

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