GM Canada, CAW reach cost-savings deal
Published Friday, May 22, 2009 6:46PM EDT
Last Updated Friday, May 18, 2012 10:57PM EDT
The head of the Canadian Auto Workers says his union has come to an agreement on further cost-cutting measures with GM Canada, which will allow the Detroit automaker to remain competitive and qualify for government loans.
Ken Lewenza told reporters gathered at a Toronto news conference on Friday morning that it was "a struggle" for his union to come to a deal with GM, but he felt the CAW had done the best it could under the circumstances.
"We have preserved our wages, we have preserved and secured our pension benefits, we have protected most of our core benefits," Lewenza said.
"Another key victory is an agreement to restructure our pension plan, which has been in real jeopardy," he added, noting that GM's pension load was a "huge" issue during the talks.
Under the deal, Lewenza said the union's pension rates will be frozen until 2015.
He said the deal also stipulates that the GM plants in Oshawa, St. Catharines and Woodstock will stay open.
Other specifics of the deal were not immediately made available, though Lewenza said it would deliver $15 to $16 in savings in the average per-hour wage of GM's Canadian workers.
Lewenza said the two sides came to the deal at 11 p.m. on Thursday, after two weeks of tense negotiations.
"It has been the toughest two weeks of our collective career for this bargaining committee," he said.
The deal is still tentative, as it must still be ratified by CAW members.
The union had been forced into the negotiations, which saw the CAW sit down with GM for the third time in the past year.
The previous agreement was signed in March, but was rejected by the provincial and federal governments, saying it did not go far enough.
"It is incredibly frustrating to go back to the members with a new contract, the third ratification in a year," Lewenza said.
CAW Local 222 president Chris Buckley told CTV Newsnet the last year has been a "rollercoaster" for auto workers. But he said that the new deal gives him some "relief in a very, very difficult time."
"We did the right thing. The alternative was, if we walked away from this, General Motors would have been forced into liquidation and all of us would have lost . . . thousands of jobs across Canada," he said Friday evening.
The provincial and federal governments had said the increased cost savings were necessary if the automaker and CAW members wanted to qualify for financial aid -- something Lewenza said was "crucial" to GM's long-term survival.
Speaking in Calgary, Prime Minister Stephen Harper expressed his approval of a deal being reached.
"I'm hopeful when we look at the deal that all involved have made the difficult decisions necessary to create a viable company," he said.
On Thursday, Lewenza had hinted that the two sides were making progress in their negotiations.
The CAW deal was announced one day after the U.S auto workers reached a deal of their own with GM.
The troubled automaker still plans to close 16 factories in order to trim its bottom line to stay afloat -- a move that will put some 21,000 hourly workers in the U.S. and Canada out of a job.
GM is facing a tight deadline to restructure its operations by June 1, a deadline that has been set by the U.S. government.
Otherwise, the company will be forced into bankruptcy protection.
With files from The Canadian Press and The Associated Press