Friday, January 9, 2009

GM, Chrysler would default on bailout loans if UAW strikes.

This is clearly an anti-union provision and weakens the unions power to resist any attempts by the companies to impose the costs of restructuring on the workers. Perhaps this move will give Flaherty an idea and he will impose a similar condition on the Canadian bailout money.

GM, Chrysler would default on bailout loans if UAW strikes
Last Updated: Friday, January 9, 2009 8:42 AM ET
The Associated Press
Provisions of General Motors' and Chrysler's $17.4-billion US in federal loans automatically place them in default if union workers go on strike.
A General Motors Corp. filing this week with the U.S. Securities and Exchange Commission detailed the provision as part of its $13.4 billion in federal loans.
A person briefed on Chrysler LLC's $4-billion loan, who didn't want to be identified because the company is in talks with the United Auto Workers about concessions, confirmed Thursday that the Chrysler deal also has a similar provision.
The UAW isn't a party to the deal and hasn't threatened a strike, its most potent weapon against the Detroit automakers.
The UAW and the automakers have a Feb. 17 deadline to agree to concessions to lower labour costs.

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