Gm Won't Pay For Performance Yet
One of America's most celebrated labor innovations just got put on hold. In its first negotiated pact with the United Auto Workers, General Motors' Saturn unit agreed to put off an innovative plan tying pay to the small-car company's results.
Pay-for-performance fell victim to Saturn's low-speed launch. Output in the 1991 model year was only 50,000 cars, a third of original projections and well below the plant's 240,000 capacity. With the assembly line limping along, union leaders persuaded Saturn management to phase in over four years a provision that links pay to productivity and quality. Still, the new contract retains virtually all of the teamwork provisions drawn up in the company's original 1985 labor agreement.