2020 Ford Employee Voluntary Separation Option
If you are Ford employee, you may have heard about Ford Motor Company’s recent announcement detailing their “Voluntary Incentive Program” (VIP), which is part of their ongoing restructuring strategy. This retirement package was offered to select salaried employees, who are already retirement eligible. These employees would have received an email notification from Ford, on or around September 8th, explaining their option to apply to be a part of this VIP program. This provides those eligible Ford employees an option to take a lump-sum cash severance if they choose to retire by the end of the year. If the employee accepts the severance offer, they will be required to sign a (no-revoke) Waiver and Release Agreement. The application period runs from Sept. 8, thru 5:00pm Oct. 23., with the company notifying the employees, in mid-November, if they are approved and able to retire under this program. The last day of employment, for those electing the incentive package, would then be either November 30, 2020 or December 31, 2020.
Below are some key points and information about the Ford VIP severance program (information derived from the references listed below).
Severance Benefits offered:
- 0-7 full years of service: receive 3 months severance pay
- 8-15 full years of service: receive 6 months severance
- 16+ full years of service: receive 9 months severance
To be eligible to apply and be accepted into the VIP program, the salaried employee must meet all of the following requirements:
- Were an active full-time TWA U.S. salaried employee on or after Sept. 1, 2020 or if inactive as of Sept. 1, 2020, returned to active status by Sept. 30, 2020
- Were in a Leadership Level 3-6 or General Salary position as of Sept. 1, 2020 and through date of separation AND
- If hired or rehired prior to Jan. 1, 2004, as of Dec. 31, 2020 you:
- Have 30 years of service under the Ford Motor Co. General Retirement Plan (GRP); or
- Are 55 and older with 10 credited years of service under GRP; or
- Are 65 and older with 1 credited year of service under GRP; or
- If you were hired or rehired on or after 1, 2004, as of Dec. 31, 2020 you:
- Are 55 and had 10 years of service; or
- Are 65 with 5 years of service; AND
- Fall within a unit that management has selected for participation in this “voluntary separation program” and have not been excluded from participation due to a critical skill or talent.
One important item to note, that everyone considering this offer should be aware of, is that all medical, dental, vision or life insurance coverage will not be provided post-retirement.
If you have questions about this retirement option could affect you and your specific retirement circumstances, please give us a call.
- Phoebe Wall Howard 2020, ‘Ford severance packages offered to U.S. worker: Here are the details’, Detroit Free Press, September 8, accessed September 9, 2020, <https://www.freep.com/story/money/cars/ford/2020/09/08/ford-motor-company-severance-packages/5738184002/ >
- Ford VIP 2020 – ‘Voluntary Incentive Program (VIP)’, August 25, 2020, accessed September 9, 2020, <https://www.thelayoff.com/t/16JxsCuW >