Lay-Off Pay Plans

May 16, 1956

Report Outline
Income Security for Industrial Workers
Supplementary Unemployment Benefits
Differences Over Lay-Off Pay Plans

Income Security for Industrial Workers

Pay for Laid-Off Workers in the Auto Industry

A new type of unemployment benefit, guaranteeing laid-off workers up to 65 per cent of their regular wages during intermittent periods of idleness, will become available to about one million industrial workers during the coming summer. The clauses of a number of 1955 labor-management contracts which carried this feature are to go into force at various dates beginning June 1, 1956. As they become effective, the workers covered who are laid off during slack periods will be able to draw on a fund, supported solely by employer contributions, for cash benefits in addition to those received under state unemployment compensation systems.

The new benefit plan, applying now mainly in the automobile industry, does not make provision for a guaranteed annual wage, as sought by the United Automobile Workers-C.I.O., but it is a long step in that direction. The compromise arrangement to which both sides agreed—which is spreading to other industries—provides for “supplementary unemployment benefits,” S.U.B. rather than G.A.W. However, G.A.W. remains the ultimate objective of the auto union. Shortly after last year's contracts were signed, U.A.W. officers said they intended to press for the annual pay guarantee once more when the 1955 pacts expire in 1958; the manufacturers reiterated strong opposition.

Demand Of Steel Workers For Pay Guarantees

The partial success achieved by the auto union in its drive for wage guarantees spurred other labor organizations to demand similar benefits. A number of them won lay-off pay concessions last year. Now another important labor-management tussle over the issue is impending in the steel industry.

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