MarketWatch

SAN FRANCISCO – Auto parts maker Delphi Corp. announced Friday a broad employee buyout program that takes the company a step closer to emerging from bankruptcy and reduces the risk of a strike that could cripple former parent and top customer, General Motors.

With the help of the world’s biggest automaker, the buyouts cover not only retirement-age workers but also unionized hourly employees represented by the United Auto Workers who have less time at Delphi.

The move will help Troy, Mich.-based Delphi cull jobs and reduce labor costs, but with financial help from Detroit’s GM. In May, the UAW’s Delphi members gave the union leadership the go-ahead to authorize a strike if their contracts were broken.

And the New York bankruptcy court overseeing Delphi’s turnaround has adjourned hearings on union labor contracts and health care benefits until Aug. 11 so that the three parties can keep negotiations going.

A hearing on Delphi’s contracts with former parent GM was also put off in favor of talks until “at least Aug. 11,” Delphi said.

According to Delphi, employees with less than 10 years seniority can get $70,000 while those with more than 10 years can expect $140,000. Employees with 26 years at the company are now eligible for a buyout previously offered to those who had worked 27 years to 30 years. Those who accept the buyout will keep only their vested pension benefits.

A previous attrition program was established in March, with a June 23 deadline.

Delphi filed for bankruptcy last October.

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