BRUSSELS, Belgium (AP) - Nearly $5.4 million in aid was proposed for workers who are losing their jobs as a result of restructuring by French carmakers Renault SA and PSA Peugeot-Citroen, the European Commission said Monday.
The assistance, which still needs backing from European Parliament and EU governments, would be the first paid out from the European Union's workers solidarity fund since it was set up last year to soften the blow of widespread economic restructuring in Europe's manufacturing sector.
The French carmakers have been restructuring to better compete with cheaper cars imported from Asia. Laid-off workers from both Renault and Peugeot-Citroen would receive help in retraining and finding new jobs, EU employment commissioner Vladimir Spidla said.
''The new fund is there as an instrument of solidarity,'' Spidla said. EU officials recommended Peugeot-Citroen workers get 2.6 million euros ($3.4 million) and Renault 1.3 million euros ($1.7 million) from the 500 million euros ($672 million) EU fund.
Peugeot-Citroen recently announced a plan to reduce its work force in France by 4,800 employees this year, offering incentives to avoid forced layoffs.
The EU's so-called globalization adjustment fund aims to offer new skills training to up to 50,000 workers per year if they are laid off or lose their jobs when a major company shifts operations to another region.
National authorities could submit aid requests, but the fund would not provide unemployment or social benefits to workers. Instead, single payments—toward job search assistance, retraining or assisting self-employment—would be offered for up to 18 months per person.
A company must eliminate more than 1,000 jobs to qualify for assistance from the fund.