General Motors will give its workers record-setting profit-share checks next month of up to $12,750, following a remarkably successful year. As reported by The Detroit News, roughly 42,300 eligible workers will receive these bonus payments from GM in their Feb. 24 paychecks.
Per an agreement between GM and the United Auto Workers union, employees can receive $1,000 for every $1 billion of profit GM makes in the North American market. 2022 saw GM rack up almost $13 billion in profit, leading to this year's record payday for workers.
The payout is in part thanks to changes negotiated by the UAW in 2019. Union negotiations led to the removal of a former $12,000 cap on profit-sharing payouts to eligible hourly workers.
"We earned record EBIT-adjusted of $14.5 billion and our eligible U.S. hourly employees earned record profit sharing totaling $500 million," explained GM CEO Mary Barra in a recent note to shareholders. Speaking on the topic, UAW Vice President Mike Booth credited workers for the great result. "Our members are essential to the success of General Motors," said Booth, adding "UAW members bring skill, experience, and dedication to the job every day and are well deserving of today's news."
GM's healthy profits and subsequent record payments to workers come amidst a backdrop of significant economic difficulty last year. 2022 saw automakers worldwide struggling with limited inventories as the chip shortage raged on. Despite this, GM was able to make the best of difficult trading conditions and had a bumper year overall.
Profit-sharing isn't a common benefit in most jobs. However, it can be valuable for employers and employees alike. For employers, it creates a great incentive for the workforce to dig deep, as they'll net a share of the winnings as a result of their hard work. It's also a great way to boost employee retention. For employees, they get to enjoy the spoils of their hard work, rather than just seeing others net the profits they helped create.
In any case, where GM is concerned, the initiative seems to be paying off. Workers are taking home a record windfall and the company is riding a wave of success into 2023.
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