Meridian Automotive retention incentive, severance programs draw autoworkers' objection

By Caroline Salls

Pittsburgh, Aug. 4 - Meridian Automotive Systems, Inc.'s proposed key employee retention incentive and severance programs drew objection from the International Union, United Automobile, Aerospace and Agricultural Implement Workers of America, according to a Thursday filing with the U.S. Bankruptcy Court for the District of Delaware.

The union said the company is seeking approval of bonus and other incentive payments to select employees, including company executives, at a time when the hourly employees of Meridian's Shreveport, La., facility have been unable to secure a collective bargaining agreement despite prolonged negotiations.

According to the objection, Meridian's Shreveport hourly production and maintenance employees currently earn, on average, $12 per hour, which is below the average wage rate of $13 to $18 per hour for auto parts and supplier firms in the Shreveport area.

"The UAW has proposed wage rates more in line with these average rates. The estimated cost of the union's most recent wage proposals is a modest $225,000 per year," the autoworkers said in the objection.

Nevertheless, the union said, the company is proposing incentive and severance programs of up to $5.7 million and $8.1 million, respectively.

"The contrast could not be more striking," the objection said.

A hearing on the incentive and severance programs is scheduled for Aug. 11.

Meridian is a Dearborn, Mich., supplier of front and rear end modules, lighting, exterior composites, console modules, instrument panels and other interior systems to automobile and truck manufacturers.

Meridian filed for bankruptcy on April 26. Its Chapter 11 case number is 05-11168.

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