Mar 08, 2009 - 02:49 PM

By Keith Gilligan

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DURHAM -- The Canadian Auto Workers has reached a tentative deal with General Motors that calls for wages and pensions to be frozen until 2012.

The CAW and GM reached the agreement around 5:30 a.m. on Sunday, and the 10,000 union members working at GM, including those in Oshawa, will vote on the deal Tuesday and Wednesday. In Oshawa, the ratification meetings will be held at 11 a.m. and 3:30 p.m. at the General Motors Centre.

In a press conference at noon on Sunday, CAW president Ken Lewenza said the agreement includes “significant sacrifice to our active (members) and retirees that will cause real hardship.

“There are no cuts to our base wages or pensions,” he said, adding benefits negotiated for laid-off workers at Oshawa and Windsor are not affected. “We obviously resisted any changes in those areas.”

It was too early to put a dollar figure on how much the agreement will save the embattled automaker, Mr. Lewenza said. However, he did say the agreement would cut “hourly labour costs by several dollars per hour.”

Chris Buckley, president of Local 222 in Oshawa, said “We’ve done what we could do to protect our active members and retirees and members on layoff. Now, it’s up to the government.”

In a statement, GM also praised the agreement, saying it “will bring the company’s labour costs to much more competitive levels and help ensure the company’s long term viability. The agreement marks a positive further step in GM Canada’s restructuring plan submitted to the Ontario and federal governments on Feb. 20, 2009.”

GM could be eligible for up to a $3-billion loan from the federal and provincial governments. One of the conditions for receiving the loan was to show it was reducing hourly wage costs.

The contract with GM Canada negotiated last year has been extended a year, to 2012, Mr. Lewenza said.

Other features of the agreement include:

• base wages are frozen for the remainder of the contract;

• quarterly cost-of-living adjustments for wages have been suspended until June of 2012 (near the end of the contract);

• no COLA increases to pensions during the contract;

• elimination of a special one-week paid vacation (this is in addition to the one-week reduction already implemented at the beginning of 2009);

• the annual $1,700 special bonus payment is being diverted to help offset the cost of retiree health-care benefits;

• introduction of a new monthly co-pay premium for health and non-wage benefits. It’s $30 per month for active members and retirees under 65, and $15 a month for retirees over 65 and surviving spouses.

By the end of the contract, workers will have gone five years without an increase in their base wage, Jim Stanford, an economist with the CAW, said.

The agreement is contingent upon the company receiving loans from the federal government, Mr. Lewenza said.

“The changes aren’t applicable until the government provides the terms of the loan. The federal government has been insistent upon the auto workers being part of the solution. We’ve done that. The (federal) government said ‘CAW, you have to be part of the solution. CAW, you have to reduce your costs.’ We’ve done that. Now it’s up to the government.

“The CAW did what it usually does and that’s to protect our workers and our communities. Now, all eyes must be on the provincial and federal governments to provide loans. They’re not grants, but loans,” Mr. Lewenza said.

“There’s nothing fair about this process whatsoever,” he said. “It’s painful. We’re frustrated.”

The CAW wanted to keep the proportion of manufacturing in Canada to about 20 per cent of the U.S. total.

“Our job was to protect the footprint” or to retain products at Oshawa, said Buckley. “The assembly plants have products. We want to put product in there and get back on our feet. “The product was reaffirmed and that gives us a job.”

“What I ask Oshawa members is to pick up the phone and call their MP. We did our part. They should be calling Colin Carrie. They should be calling Jim Flaherty,” Mr. Lewenza said.

Mr. Buckley said GM will make an announcement on products for Oshawa.

“The products are there and we’ve done what we can to ensure the products are there.”

“We’re very confident our members will be satisfied. There’s been unprecedented anxiety, this dark cloud over their heads,” Mr. Lewenza said. “Our members have been through so much stress the last four or five months.”