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GM likely to spend $500M on employee payments

29 February 2012 16:08 (UTC +04:00)

Baku - APA-Economics. General Motors is likely to spend more than $500 million on employee bonuses and profit-sharing based on the companyâ€™s performance last year, Chicago Daily Herald reported.

GM, which made a record profit in 2011, will pay bonuses of at least $182 million to white-collar workers such as engineers, car designers and managers on Wednesday, according to a formula obtained by The Associated Press. Thatâ€™s on top of $332.5 million in profit-sharing it already agreed to pay factory workers.

In the past, such payments have drawn criticism from those who believe the government shouldnâ€™t have bailed out GM and Chrysler. But GM, which made a record $7.6 billion last year, says the payments are needed to hold on to skilled employees. Itâ€™s also keeping fixed costs down by giving bonuses instead of annual pay raises.

The bonuses will go to most of the companyâ€™s 26,000 salaried employees, many of whom make more than $100,000 a year. The bonuses will range from 8 percent of base pay to 14 percent, according to the formula.

The company would not release the percentages, nor would it say how much it will spend on the bonuses. But itâ€™s likely the average bonus for salaried employees will be more than the $7,000 that each of GMâ€™s 47,500 factory workers will get in March.