General Motors of Canada and the Canadian Auto Workers agreed a three-year contract late on Tuesday, narrowly avoiding a strike, the New York Times (NYT) reported.

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The paper said the last-minute scramble to produce an agreement was in contrast to confident expectations of a deal earlier in the day. The union reportedly said that although the tentative agreement, offering only modest wage and benefit increasers, had been reached, talks would continue to resolve some minor issues.


Citing CAW head Buzz Hargrove, the New York Times said the agreement includes at least 1,000 job reductions, some of which will be layoffs, a point which differs from contracts negotiated earlier with Ford and Chrysler, which had specified that job reductions would all be through attrition or early retirement.


The NYT noted that, after a bargaining session that began Monday night and stretched into the next morning, the union was so confident of successfully finishing talks that it scheduled a news conference for mid-morning Tuesday though that session was never held after being repeatedly postponed throughout the day.


According to the New York Times, the crucial issue was on the future of about 1,020 jobs at a components factory in St. Catharines, Ontario, as well as a smaller number of positions at GM’s main parts warehouse in Woodstock, Ontario, which employs about 300 workers.

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As was the case with the union’s agreements with Ford and Chrysler, the GM agreement provided a wage increase of about 1.5% in the first year and about 1% in each of the subsequent years, the paper added, noting that the union also agreed to limits on health care payments and a reduction in dental benefits.


The New York Times noted that the three contracts are somewhat at odds with the CAW’s history – Canadian autoworkers left the UAW 20 years ago and formed a union partly because they believed the Detroit-based union was weak at bargaining.


That the CAW would accept such contracts, several analysts told the paper, is a sign of what to expect when the UAW starts negotiating contracts that expire in 2007.