GM Cuts Contract Workers

June 4, 2019—The first workers to fall victim to General Motors' recent job cuts were contract workers. Businesses of course hire on contract workers to do a specific job when they need them and then can end their employment when they don't, reported The Detroit Free Press.

Contract workers are brought in to do a specific job. When that work ends, so can their employment unless the staffing agency reassigns them to a new job. These layoffs can come without severance pay. Only rarely are contract workers hired on permanently by a corporation.

And, the first workers to fall victim to GM's cuts were contract workers. About 1,500 were cut starting late last year, GM said. Recently, Ford Motor Co. slashed thousands of white-collar jobs, but many of its contract workers got the boot first, sources said in the report.

The Detroit Three automakers increased their use of contract workers during the Great Recession and after GM and Chrysler's bankruptcies in 2009. The Detroit Three accelerated pressure on the UAW to move such jobs as janitors to contractors in 2007, said Kristin Dziczek, vice president of industry, labor and economics at the Center for Automotive Research in Ann Arbor.