Filed under: Ford, UAW/Unions, Canada
CAW reaches deal with Ford five months early
We've been hearing for some time now that Buzz Hargrove and the CAW didn't want to have anything to do with the two-tier wage structure or health car plans that the UAW agreed to. Before the landmark labor contracts were ratified in the States, American auto manufacturers enjoyed the cheaper cost of building cars in Canada, and because that difference in manufacturing cost was no longer a factor, it appeared that the CAW and Detroit could be in for a long and messy fight. That may not be the case, though, as word comes from our unionized-friends up north that the CAW and Ford have already agreed in principle to the major points of their upcoming contract, a whopping five months ahead of schedule.
According to Automotive News, the union is expecting a deal to be done by the end of the week. We can surmise that the deal does not include a multi-tiered wage structure, though. "We were not going to do a tier-two and if Ford had insisted it would have resulted in a fight," says Hargrove. The CAW did, however, agree to give up 40 hours of vacation time per year, a supplemental health care fund and a reduced entry-wage for new-hires. Ford will compensate CAW workers with a single payment of $3,500 for the lost vacation time and a $2,200 bonus if the contract is ratified at the plant-level. Ford also promises to keep the St. Thomas plant open until at least 2011 as opposed to the current plan of 2010. See the press release after the break for all the juicy details.
[Source: Automotive News - Sub. Req., CAW]
CAW Beats Back Two-Tier Wages, Wins Reprieve for St. Thomas Plant
April 28, 2008 - Following early background negotiations, Ford Canada and the CAW have reached an agreement on a Master Economics Offer that will now become the centerpiece of all-out collective bargaining aimed at reaching a tentative agreement between the two sides later this week. For a full tentative agreement to be reached, agreement also must now be attained on all local agreements (skilled trades, health and safety, etc.). That tentative agreement must then be ratified by CAW members at all Canadian locations. The current collective agreement expires at midnight September 16. The Master Economics Offer was endorsed unanimously by members of the CAW-Ford Master and local bargaining committees at a special meeting in Toronto on Monday.
Highlights of the Master Economics Offer:
- Three year contract, expiring midnight September 14, 2011;
- No changes in base wages;
- No two-tier system for wages, pensions or benefits;
- Extended the life of the St. Thomas assembly plant through life of agreement (to 2011) The product commitment was scheduled to end in 2010;
- COLA payments frozen for remainder of current contract, and first year of the new contract. Quarterly COLA wage adjustments resume under existing formula Dec. 2009;
- $2200 " productivity & quality" bonus to be paid upon ratification;
- Inflation-indexed pension increases for both existing and new retirees in second and third year;
- Significant savings in health costs (stricter cap on long-term care, 10% co-pay on drugs to $250 annual maximum per family);
- Modest improvements in health benefits and spousal insurance benefit;
- New-hire grow-in system, where wages, COLA, SUB benefits, and time-off provisions are phased in (starting at 70% of base wages) over the first three years of work; after three years, wages reach 100% of base wages;
- Reduction in vacation pay by 40 hours per year, compensated with special $3500 cash payment in January 2009;
- Improved restructuring benefits (" buy-outs" ) and renewed income security funds.
- Commitment to explore Canadian opportunities to establish a pre-funded, off-balance-sheet Retiree Health Benefit Fund;
The offer includes a mixture of modest gains and cost savings that in the CAW's judgment will ensure that Canadian facilities over the life of the agreement will remain in the ballpark for new investment opportunities.
Reader Comments (Page 1 of 1)
Chris 7:16AM (4/30/2008)
Why do CAW workers need health insurance?
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jay tee 7:26AM (4/30/2008)
Universal health care doesn't mean everything is covered. Your basic health is taken care of (doctors visits, emergency visits, required surgeries, etc.), but not everything.
Need your wisdom teeth taken out? Pay up. Want some Viagra? Pay up. Want crutches when you break your ankle? Pay up. Ambulance fees? Pay up.
Nothing is free in this world, my friend.
rooster 7:25AM (4/30/2008)
You'd think that those espousing "universal coverage" for the U.S. would look around, but they have a utopian view of the world, or perhaps rose colored glasses.
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Luke 8:20AM (4/30/2008)
I used to think that the universal health-care folks were a bunch of whiners who couldn't handle being responsible for themselves.
However, as I interact more and more with the US healthcare system, it's clear that it's fundamentally messed up, and major changes are needed so that doctors offices spend their time taking care of patients rather than figuring out how to get paid. The doctors that I've dealt with do this as much as possible, but it's still a problem -- one local opthalmologist has an outsourced "wring the insurance company" service which negotiates with insurance companies for them and makes the paperwork go away. Services like that, which are staffed with experts, aren't at all cheap!
Another problem is that the insurance-rate and the cash-rate are quite different. An individual pays a lot more for a given service than the insurance company. It's like this at auto-body shops, too, but that doesn't make it right.
So, there are real problems... We need real leadership and a bunch of changes to the existing system that are too fine-grained for our political system to handle -- or we could wipe it away and replace it with something relatively sane in one fell swoop... And that seems more doable. Unfortunately, making laws that force people to buy insurance isn't going to simplify anything either -- and that seems to be what our remaining candidates are proposing.
If I could have my cake and eat it too, I'd prefer a free-market/libertarian/capitalist solution... But that doesn't seem to be happening, and somebody's gotta fix it...
Digitalrailroader 8:09AM (4/30/2008)
Well, This Means that More Crown Vics, Grand Marquis, and Town Cars Will be built and be Limos, Police Cars, Taxis, and Regular Private Cars!
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Throwback 8:09AM (4/30/2008)
We already have universal coverage in the US. Anyone who walks into an emergency room gets care, it's the tax payers of the city that pay for it. Not the most effective way to pay for health coverage, but don't kid yourself those of us who pay taxes are paying for the uninsured.
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Tagg 12:37PM (4/30/2008)
Good call, I am glad someone out there understands that and isn't blinded by election year B.S.!!
Did you know in the U.S. the top 5% in wealth pay over 50% of all taxes and 15% of people who earn income do not pay taxes?
steve-o 12:21PM (4/30/2008)
does the new deal involve the CAW members doing a better job of assembling vehicles?
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Johneboy 1:11PM (4/30/2008)
I find it difficult to believe that Ford workers have to give up any concessions at all, considering that Ford just posted a 100 million dollar profit for the last quarter. The UAW, then since 1985, CAW have been negotiating contracts for autoworkers in Canada since the 1930's. Can anybody explain to me why the "Big 3" have to match Toyota or Honda. We have 70 plus years of bargaining precedent! I am a second generation autoworker and between me and my father we have 42 long years of service to Chrysler. Nobody has the right to call me overpaid. Everything I have has been negotiated over the last seven decades. Chrysler and the other two are all to willing to take the "corporate welfare" handed out by our governments, then when it runs out, they cut a shift, close down a plant etc. It is time that these corporations are forced to accept their social responsibilities. If you build a product that sells using a domestic workforce and you are making a profit you should not be allowed to outsource or eliminate jobs, you should not be allowed to close your plant, destroy the local economy and set up shop in some third world locale. Just remember who is going to buy your car when the middle and working class are all making minimum wage, or unemployed. Henry Ford was the first industrialist to pay his workers well enough so that they could buy the product that they built. Maybe the top management of the big 3 should follow that example instead of trying to mimic Toyota and Honda!
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PiCASSO 2:09PM (4/30/2008)
Single payment of $3,500 to each worker for 40-hours of vacation = $87.50/hr base rate. That's works out to an effective annual salary of $182,000.
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liketoknow 6:24PM (5/03/2008)
The $3500.00 covers 3 years of vacation pay......so 120 hours of pay for $3500.00
JOHN 11:21AM (5/18/2008)
PLEASE GO BACK TO THE BASICS. MY SHEET ONLY SHOWS $44.54 (WAGES AND BENEFITS). MOST OF YOU SAY $77 AND NOW YOU WITH SOME NUMBERS.
bakka 2:51PM (4/30/2008)
http://socialistworld.net/eng/2008/03/29romana.html
Check out this story,then let the poop fly.
Eventually the low paid workers are going to want what we have.
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mroverlord 6:34PM (4/30/2008)
Johneboy:
It's called competition. If your overhead is more than you competitors, you either make less profit or you have to charge more for your vehicles, making them less attractive to consumers.
Nearly everything is cheaper in the southern states. Operating a plant, paying taxes, paying fair wages is all cheaper in the the non coastal and southern areas of the US.
I am all for people making a reasonable amount of money. I believe in fair work for fair pay, with a performance bonus when profits are high.
Where I work, the max an hourly person can make is about $23/hr. With 38% added for benenfits (medical, dental, vision, AD&D, tuition reimbursement) that's about $32/hr. That works out to $47,800 ($66,500 with benefits)....I don't know about you, but that's pretty good. My team members never complain about pay and we are skilled trades in a southern state.
Now, what do you make at Chrysler might answer your own question. I am a big Chrysler fan, and own them new and old, but I will be the first to say that if the company is sucking wind, you can't expect to make what you did back in the hayday....Market share is shrinking with more world competition, and the labor size and pay will have to adjust.
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steveo391 7:50PM (4/30/2008)
You guys are a couple days late, this was front page news here on monday. I live in the windsor area so it's kind of a big thing for us when theres any kind of good news coming from the automakers, it's all we have around here and hopefully we won't lose any more than we already have.
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Tagg 12:51AM (5/01/2008)
I think the Ford gave in on the two-tier wage structure because the CAW is not the militant entity that the UAW is. They seem to look further ahead than just the 7 years the UAW does when it comes to contract negotiations.
Too bad not everyone could see how the UAW acts by watching the local Detroit T.V. stations. There was a story showing them picketing and chanting "we are the union, the mighy, mighty union!" and showing members screaming with rage that they were willing to put the company in bankruptcy rather than give up their wages.
See the irony in that statement? But thats how they think, if the company goes down and everyone loses their job they won because they stood up for their beliefs.
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