Thousands of Canadian Auto Workers (CAW) members at Chrysler facilities in Brampton, Windsor and Etobicoke have voted in favour of a new restructuring agreement, ratifying the deal by 87% during a series of meetings held over the past two days. The deal was reached late on 24 April between the two sides.
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“Our members understand better than anyone the current turmoil of the domestic auto industry,” said CAW president Ken Lewenza in a statement.
“The high acceptance of this agreement is a recognition that although workers did not cause this crisis, we all have an interest in maintaining good jobs and ensuring the auto industry remains central to the overall Canadian economy.”
The deal is the second cost-cutting agreement reached between the CAW and Chrysler in less than a year and includes cuts to benefits, a reduction in time off, relief time and the formation of Canadian Health Care Trust fund, the first of its kind in the country, and equivalent to the VEBA funds set up to fund healthcare for UAW members in the US.
The CanWest news service said the CAW concessions totalled C$240m a year but preserved existing basic wages and pensions.
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By GlobalData“We had to make the necessary compromises to live to fight another day,” Lewenza told about 5,000 workers and retirees gathered at the University of Windsor to hear details of their contribution to Chrysler’s survival plan.
The CAW’s Local 444 president Rick Laporte told CanWest the 90.3% vote in Windsor in favour of the contract showed that the membership was “educated and understood the position the bargaining team was in,” given the realities of Chrysler as a corporation and the condition of the domestic auto industry.
“Chrysler is in a bad way,” he noted. “We did what we had to just to survive. There’s still a lot of turmoil. Bankruptcy could happen in three to four days.”
Under the deal, which expires in 2012, workers will get no cost of living increases and give up their one-time, C$3,500 holiday buyout, CanWest said.
They will also give up their C$1,700 Christmas bonus, with the money going into the fund to pay for retirees’ health care benefits. They will now have to contribute C$30 per month toward their health care coverage (C$15 for retirees over the age of 65) and that money will go into that same retirees’ health care fund. Their copayments for drugs will increase by C$20 per year and they will lose coverage for semi-private hospital rooms.
Gone as of January are special employee discounts on vehicle purchases and tuition reimbursements, CanWest added.
Lewenza said in the statement the CAW-Chrysler deal would be the basis for negotiating new agreements with General Motors and Ford. No dates have been set for opening negotiations with either of the other two companies.
Chrysler chairman and president Tom LaSorda said in a statement: “We are extremely grateful to the CAW leadership and to its hard-working members for their openness in this challenging environment to create a new strategy that will lead this company on a path to success.
Al Iacobelli, the company’s chief bargainer and head of employee relations added: “We deeply appreciate the CAW leadership’s dedication and commitment to the process by reaching this tentative agreement. The negotiation process is never easy, especially in these historically challenging times.
“The forthright discussions and final decisions made by the CAW not only benefit the Canadian represented employees, but help to ensure the company’s future competitiveness. The tentative agreement also helps move the company one step closer to a partnership with Fiat SpA.”
