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Toyota Venture Plant Union Criticizes Severance Terms

Toyota Venture Plant Union Criticizes Severance Terms (Update2)

March 17, 2010, 5:45 PM EDT

By Alan Ohnsman

March 17 (Bloomberg) — Toyota Motor Corp., the world’s largest carmaker, added a “gag order” to severance terms for workers at a California plant slated to close to keep employees from discussing the deal’s details, a union official said.

New United Motor Manufacturing Inc., or Nummi, in Fremont, California, a former joint-venture factory equally owned by Toyota and the former General Motors Corp., is to halt auto- assembly operations on April 1. United Auto Workers employees at the plant vote on the severance package today.

“The offer mandates a gag order that I believe violates our First Amendment rights under the U.S. Constitution,” Sergio Santos, president of the plant’s UAW Local 2244, said in a statement today. “Under conditions set by Toyota, after the agreement is ratified, I will no longer be able to comment on the plant closing or its impact on our members.”

Toyota said March 3 that it would pay $250 million to Nummi’s 4,700 workers who will lose their jobs when the plant closes. Motors Liquidation Co., which took over assets shed by the former GM, and the new General Motors Co., which exited bankruptcy in July, aren’t providing financial aid to Nummi workers.

“Nummi did not issue a gag order,” said Lance Tomasu, a plant spokesman. “In fact, the union negotiated and proposed specific language for that provision of the agreement.”

Severance Total Increased

Toyota boosted its total severance payment to $278 million, Santos said today in a telephone interview. Results of the UAW local’s ratification vote may be available tomorrow, he said. In the statement, Santos said the UAW members probably will accept the offer.

Motors Liquidation’s lack of assistance is a “copout,” Santos said. “But Toyota has the ability to pay and the ability to keep the plant open,” he said.

Mike Goss, a spokesman for Toyota’s North American manufacturing unit, declined to comment.

Nummi, California’s last large auto-assembly plant, opened in 1984 as an experiment for GM to study Toyota’s manufacturing methods and for the Japanese company to try running its system with U.S. workers. The factory had been solely owned and operated by GM from the early 1960s until the Detroit-based automaker closed it in 1982.

Toyota’s America depositary receipts fell 13 cents to $79.30 at 4:15 p.m. in New York Stock Exchange composite trading. They have declined 5.8 percent this year.

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