FCA asks workers to return hundreds of dollars in 'overpayment' following COVID-19 relief money
Fiat Chrysler Automobiles is having 24,000 employees repay hundreds of dollars in “overpayment” from supplemental unemployment benefits known as "SUB pay" after federal COVID-19 relief funds went into effect, according to a letter obtained by The Detroit News.
The contract ratified by the United Auto Workers last year with Fiat Chrysler requires the automaker provide SUB pay to temporarily laid-off workers that brings their compensation to 74% of their usual 40-hour wages. With an additional $600 per week to the unemployed from the Coronavirus Aid, Relief and Economic Security Act, however, workers’ compensation surpasses that 74% threshold with government support alone.
The additional unemployment funds retroactively went into effect the week ending April 4 when FCA also paid out supplemental benefits for a second week following the shutdown of auto plants in North America because of the virus outbreak. Now, FCA says it will withhold some compensation to make up for that overlap. The average payout was $500, which can be repaid by $100 payroll reductions per week. Some also have paid in lump sums.
“I feel that is our money,” said La Tonya Washington, an 11-year FCA employee who works as a material handler at Sterling Heights Assembly Plant. “It's going to be a challenge for everybody to pay that back. Them taking that back is like a big slap in the face to us."
The request for repayment comes as Fiat Chrysler has borrowed billions of dollars, halted development programs, laid off hundreds of supplemental workers and deferred portions of white-collars workers' salaries to conserve cash amid the two-month production shutdown in North America. Plants began reopening last week.
"The $600-a-week in economic support provided as part of the Federally approved CARES Act is an offset to the company-paid supplemental unemployment benefits an employee may be entitled to receive," the company said in a statement. "Because the CARES Act benefit was paid retroactively, some FCA employees received an overpayment of their supplemental unemployment benefits, averaging about $500, which they are now being asked to repay."
Employees at General Motors Co. and Ford Motor Co. said once the $600 government payments kicked in, they did not receive any SUB pay. As a result, there are no plans to request repayments, according to the companies.
Washington, 47, of Detroit is joining some of her colleagues in filing grievances over the matter. In hers, Washington argues the workers are entitled to the weeks of SUB pay already received; she also requests FCA supply SUB pay for the weeks employees received the additional $600, too.
“This is a contractual matter and the UAW is closely monitoring how it is being applied," UAW spokesman Brian Rothenberg said in a statement. "Any member who thinks that they have received an overage letter in error should talk to their local union representative to look into these questions.”