Just a few days after Ford agreed to a four-year contract with the Canadian Auto Workers, General Motors agreed to the same terms with the union late last night. GM’s four-year deal calls for the creation or maintaining of 1,750 jobs and an investment of $675 million for the Oshawa assembly facility and St. Catherines powertrain facilities. With both Ford and GM coming to terms with the CAW, Chrysler remains the only major U.S. automaker not to have struck a deal. However, talks with Chrysler aren’t expected to be dragged out and a deal could be reached sooner rather than later.
The agreement between GM and the CAW must still be approved by about 5,500 local union workers who still need to vote. The exact date of when the voting will take place hasn’t been announced yet. Barring any unforeseen circumstances, the new deal will keep from having to lay-off any senior workers, something that has been unavoidable for more than the past 20 years. As part of the agreement, GM has also agreed to add a third shift on the Oshawa assembly facility flex line sometime in early 2013, which creates or maintains 900 jobs alone. This comes after GM announced back in June that it would be shutting down a separate consolidated assembly line at the Oshawa plant in the next 12 months. This shutdown would have killed off 2,000 jobs. Now, GM will also keep one consolidated line shift at the Oshawa facility too through June of 2014 and maintain 750 jobs along with it. There’s still a possibility that a second shift could be added which would add an addition 750 jobs to the 1,750 jobs already created or maintained. St. Catharines facility will also see the creation of maintaining of 100 jobs as well.
As part of the new deal, newly hired employees will have to wait a few extra years before they can be paid a top-tier wage. A $3,000 ratification bonus would come along with it too. All base wages will stay at its current rate throughout the life of the new, four-year contract. Cost-of-living adjustments will also be frozen for the same amount of time but each worker would receive an annual $2,000 “lump sum cost-of-living improvement” over the last three years of the deal. Retired workers are excluded from the pay-bump for the newly agreed upon cost-of-living clause. New employees will have a completely separate and new “hybrid” pension system which combines both a defined benefit plan and a contribution plan. Veteran workers won’t see any changes made to their pensions, either good or bad.
Before GM and the CAW agreed to terms, the Detroit-based automaker was reluctant to follow the framework that helped Ford reach an agreement. If no counter-proposal was submitted by GM by yesterday evening, the CAW was ready to issue a 24-hour notice that it would go on strike. Originally, the CAW asked GM to give it the responsibility of assembling a new model, but the Bowtie brand shot that idea down. This follows an agreement in place that when the Canadian government gave GM $9.5 billion during bankruptcy, in return, the automaker would bestow production responsibilities and the investments that come along with each through 2016. GM was also against mandatory hiring and employment but was in favor of matching its workforce with its product demand.
The only major U.S. automaker that remains unsigned is Chrysler but CAW President Ken Lewenza believes a deal should be in place soon.”Be patient,” Lewenza said to Chrysler workers last night according to The Detroit News. “Our strategy is working.”
Stay tuned to Automotive.com as more details unfold and for when a deal is reached.
Source: The Detroit News