Toyota settles over disabled NUMMI workers in U.S.

Reuters News
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Posted: Aug 19, 2011 2:48 PM
Toyota settles over disabled NUMMI workers in U.S.

DETROIT (Reuters) - Toyota Motor Corp has reached a $6 million settlement with former workers at the shuttered California plant it once operated with General Motors Co.

The payment settles a lawsuit brought by workers who were on medical leave when the San Francisco-area plant shut in March 2010. They claimed they received smaller severance payouts than Toyota offered other workers at the plant.

The settlement announced on Thursday represents one of the last complications from Toyota's decision to close its only U.S. plant where workers were represented by the United Auto Workers union.

The Fremont, California plant opened in 1984 as a joint venture between GM and Toyota. The factory was the first U.S. plant for Toyota, and it gave GM a chance to study its Japanese rival's vaunted lean manufacturing system.

The plant, called New United Motor Manufacturing Inc, or NUMMI for short, closed eight months after the last GM car from its defunct Pontiac brand rolled off the assembly line.

The settlement was reached between Toyota and the U.S. Equal Employment Opportunity Commission.

About 500 workers are expected to file and receive awards from the settlement, which will be based on tenure and pay scale, said Marcia Mitchell, an attorney with the EEOC.

Mitchell said many of the workers were injured on the job.

The payouts per worker will be worked out through the formula agreed to by the company and the EEOC. After attorneys' fees and other deductions, the awards will total about $5.3 million.

Dividing that amount by the 500 expected recipients would lead to an average payout of about $10,500. But Mitchell cautioned that the formula could yield a range of payouts.

The number of workers who get payouts depends on how many apply.

For 25 years, the NUMMI plant was operated by Toyota and GM. In its last year, Toyota made its small Corolla sedan and its small pickup truck Tacoma at NUMMI, and GM produced the Pontiac Vibe there. Pontiac was one of four brands that GM dropped or sold as it restructured after its 2009 bankruptcy.

(Reporting by Bernie Woodall. Editing by Robert MacMillan)