Toyota announced plans Thursday that would cut the compensation of every one of its manufacturing employees in North America, from top executives to assembly line workers.
The plan will see executives give up anywhere from 25 percent to 30 percent of their total pay, while salaried workers will see a decrease of around 20 percent and production workers will receive smaller bonuses. Production workers at the Georgetown plant, the largest private employer in Central Kentucky, will lose at least a few thousand dollars annually.
The plan avoids layoffs, which have become frequent at rival automakers, but does include a buyout program, reduced work weeks at some plants and no wage increases for the foreseeable future.
Georgetown, the company's largest North American plant, is not likely to be among those with workers forced to work fewer hours, said spokesman Rick Hesterberg. However, its employees will be affected by the other moves.
Another major factor for production employees' pay is Toyota's earlier decision to cut overtime.
Jerry Bell, a group leader in body welding, said a typical body weld employee might see a rough drop in pay of $10,000 to $15,000 because of overtime loss.
He also said he knows employees around the plant who are applying for second jobs to supplement their income.
"They've basically lived on their overtime," he said.
The recession has taken a heavy toll on Toyota, like the rest of the auto industry.
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