The Canadian Auto Workers union and DaimlerChrysler Canada averted a strike early on Tuesday, reaching a tentative three-year agreement providing modest wage, pension and benefit increases, Reuters reported.

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The agreement, reached on the day the current contract was due to expire, reportedly also improves job security for workers at plants in Brampton, Windsor and Etobicoke, Ontario.


In a joint statement in Toronto, the two sides said the deal provides for the same level of wage, pension and benefits increases as the agreement negotiated last week between the CAW and Ford Canada, Reuters said.


Like the Ford agreement, the CAW-DaimlerChrysler deal contains measures aimed at reducing the cost of health-care benefits, the news agency noted.


Reuters said details of the DaimlerChrysler wage increases were not released, but the deal with Ford includes wage increases of 45 Canadian cents an hour in the first year, 30 in the second, and 30 in the third.

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The toughest negotiations between the CAW and DaimlerChrysler Canada dealt with local job security and operational issues, the statement reportedly said. The automaker had wanted to slash 2,500 jobs and the union threatened to strike if the company did not back off its demands.


Significant changes in work practices were negotiated with the aim of enhancing productivity, the report said. However, with a $C70,000 restructuring incentive to encourage early retirement, the changes should not result in any lay-offs, it said.


According to Reuters, the contract provides for the continued operation of the Etobicoke castings plant, with fewer workers, while the Windsor and Brampton assembly plants will keep three-shift schedules.