About 26,000 salaried workers at GM will receive performance bonuses today while 47,500 hourly workers on Friday will receive profit-sharing checks averaging $7,000.
And the amount U.S. salaried workers will receive in bonuses for 2011 will be less than their 2010 payout because of the company's overall performance.
GM will pay its hourly workers a total of $332.5 million in profit-sharing. The automaker wouldn't say how much bonuses to salaried workers will cost, but the total for both groups could stretch beyond $500 million, based on GM's corporate bonus formula.
Each salaried individual's bonus is based on the level of their position and personal performance as judged by their supervisor. It can vary from worker to worker.
GM, which received about $50 billion in government assistance to restructure in 2009, continues to grow sales and invest in a stronger line of vehicles. Until the government sells its GM stake, now about 26 percent, the U.S. Treasury restricts compensation for the automaker's most senior executives. Still, GM must retain talent as the auto industry rebounds and the labor market improves for many industries.
"It is important we attract and retain top talent for the organization," said GM spokeswoman Lynda Messina. The program also drives accountability, she said.
Salaried bonuses are based on a complicated formula triggered when GM achieves specific business targets globally. Those include pretax profits, cash flow, quality and market share.
Salaried workers first learned on Feb. 15 that they were eligible for bonuses, but the amounts were not known until full-year earnings were released Feb. 16.
GM reported record earnings of $7.6 billion in 2011, dampened by losses in Europe and South America. Most middle managers are classified from level 2 at the lower end to level 9 -- senior executives such as CEO Dan Akerson are unclassified.
A level 2 manager, with a base salary of $50,000, for example, could potentially be awarded 9 percent of his or her salary as a bonus under the Enhanced Variable Pay program. A level 9 manager could get up to 16%, said Messina. The final percentage is based on personal performance as judged by a supervisor.
This year, salaried employees are only eligible to receive 86 percent of that final figure because GM did not reach all of its company performance targets. Last year, they received 145 percent.
Hourly workers operate under a different formula based on pretax profit in North America, set forth in an agreement negotiated last fall with the UAW.
