Ford sharing wealth of recent gains
Ford sharing wealth of recent gains
- Ford salaried workers will receive both merit raises and bonuses this spring for the first time since 2008, reflecting the automaker's growing financial strength.
Letters with the good news went out last week to about 20,000 salaried workers around the world, spokeswoman Marcey Evans confirmed.
The 2.7 percent base salary increases will take effect April 1, according to a letter obtained by the Detroit Free Press. Ford declined to discuss the size of the white-collar bonuses. The amount is based on performance and financial metrics that are still being calculated.
Last year, the average Ford salaried worker received a bonus equal to 15.5 percent of his salary, according to Sean McAlinden, an economist with the Center for Automotive Research.
Senior executives, including President and CEO Alan Mulally, Executive Chairman Bill Ford, and Mark Fields, president of the Americas, received bonuses greater than their salaries, according to Ford's 2011 proxy statement. Mulally has said Ford's pretax operating profit for 2011 will exceed 2010's $8.3 billion.
Last year, Ford salaried workers received bonus checks, but no merit raises. In 2010, they received only merit pay raises. There were no raises in 2009.
Ford paid its UAW workers a profit-sharing check that averaged $5,000 in March 2011 for the company's 2010 results. Then, as part of the new four-year agreement ratified last fall, Ford's 40,600 UAW workers in December received profit sharing averaging $3,252, based on the company's North American profits in the first half of 2011. That was in addition to a signing bonus, competitive bonus and inflation protection lump sum.
In March, hourly workers likely will get a second profit-sharing check based on North American profits in the second half of 2011.
Last year, Ford withheld merit raises because management determined compensation for its white-collar workers was competitive with 23 other companies Ford had benchmarked, including General Motors.
The increased compensation is "in line with Ford's commitment to provide competitive base salaries and profitable growth for all," Fields said in the letter.
Salaried bonuses are tied to a complicated formula that factors in such metrics as profits, market share, cost and quality.
Ford is expected to release its fourth-quarter and full-year financial results later this month.
Salaried bonuses are paid under the company's Annual Incentive Compensation plan. The global plan covers about 20,000 employees in the U.S. and Canada, as well as managers in other parts of the world.
Ford is also increasing the amount it matches in employees' Savings and Stock Investment Plans, the letter says.
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