Canadian Auto Workers Have Tentative Deal at GM. Fiat Holds Out

Negotiators for the Canadian Auto Workers have reached a new four-year agreement with General Motors of Canada. The GM tentative agreement, if ratified by its 5,500 GM members, follows the same pattern as the agreement reached earlier this week with Ford.

CAW President Ken Lewenza announced some of the details of the GM deal at a press conference held at the Sheraton Centre Hotel last night. The GM deal includes a C$3,000 quality and productivity bonus for workers upon ratification, as well as cost of living lump sum payments (to be paid before the Christmas holiday period) of $2,000 in each of 2013, 2014, and 2015.

Lewenza said the agreement offers protection of current pension benefits for existing workers and incremental improvements in benefits, including dental care. However, in a clear setback for the union, it also agreed to the same ten-year “New Hire Grow-In program” that Ford obtained. This is means new union workers start at $20.40, equal to 60% of the current base rate, and only get full compensation after 10 years – a four year increase in the time needed to do so under the existing contract.

In return, GM will create a third shift in the Oshawa Flex assembly plant starting early next year, which will create or – in the sad language of multinational corporations that use off-shoring to thwart union demands – “maintain 900 jobs.” Production will be extended on at least one shift, possibly two, for an additional year at the Oshawa Consolidated Plant until June 2014.  This represents an extension of at least 750 jobs, possibly more if the second shift is extended. GM also made firm commitments to a range of new engine and transmission investments and production in the St. Catharines plant. Two decades ago GM had more than 20,000 CAW members working in its plants.

In trying to sell the deal to its members, the CAW said that GM is will create, maintain, or extend 1,750 jobs across its Canadian operations (900 on the third Flex shift, 750 or more in Consolidated, and 100 new positions associated with new work in St. Catharines). The company’s commitments in Oshawa and St. Catharines involve additional capital spending during this collective agreement of at least $675 million. Under GM’s business plan, and based on economic and actuarial projections, the seniority workforce should be fully employed by the end of the agreement, said the CAW.

GM also confirmed in writing that it will meet the Canadian manufacturing commitment, negotiated with the Canadian and Ontario governments in order to receive bankruptcy funding, through the life of this agreement.

The CAW is in the process of setting up membership ratification meetings in Oshawa, St. Catharines and Woodstock.

The CAW is continuing talks with Chrysler with the intent of reaching a third, and final, deal.

“There are still a number of challenging issues to work through,” said CAW President Ken Lewenza. “We’re not there yet, but as long as we keep making progress at the bargaining table, we will continue to negotiate.”

It’s ironic that Chrysler was the first company to settle four years ago, but this time around is holding out. That’s because in the years leading up to its collapse and bankruptcy reorganization in 2009 employment levels had declined. With Chrysler’s ongoing revival and growth it will have to hire new workers. Sergio Marchionne, CEO of Fiat and Chrysler, is determined to hold costs down.

Chrysler negotiators might be holding out to see if the CAW can get the controversial contracts ratified. A step in that direction occurred today as CAW in-plant leadership at Ford unanimously endorsed the new, four-year collective bargaining deal that extends U.S. style two tier wages. The union will be holding a series of ratification meetings over the weekend, where members at Ford will vote on the tentative deal.

(See CAW Working as 24-hour Contract Talks Shift to Chrysler, GM and Ford Canada and CAW Reach Tentative Contract Agreement)

About Kenneth Zino

Ken Zino is an auto industry veteran with global experience in print, broadcast and electronic media. He has auto testing, marketing, public relations and communications expertise garnered while working in Asia, Europe and the U.S.
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