The new labour deal Unifor has reached with two members of the Detroit Three auto makers is running into trouble at Ford Motor Co. – on both sides of the bargaining table.
The Unifor local representing Ford workers at the company's assembly plant in Oakville, Ont., says the agreement approved by General Motors of Canada Co. workers does not meet the needs of employees in Oakville.
Ford, meanwhile, is concerned about wage increases in the GM contract, which has also received tentative approval of Fiat Chrysler Automobiles NV executives and is scheduled to be voted on by Fiat Chrysler Canada employees on Sunday.
"Ford has been quite vocal to us that they don't like the GM pattern," Unifor president Jerry Dias said on Wednesday. "They are certainly not pleased about the significant wage increases for the people on the 10-year grid."
The new agreement calls for the starting wage for newly hired employees to rise to $20.92 an hour from the previous level of $20.49. It also provides for increases in each of the first two years of employment, compared with the 2012 contract, which held the starting wage to $20.49 during the first two years of a 10-year progression to the full pay rate of $34.15 an hour.
The tentative deal, which FCA executives opposed originally but approved in a last-minute settlement on Monday, also includes $12,000 worth of bonuses during the four years of the contract.
The progression to the full wage rate – first put in place in the 2012 agreement – is a crucial issue in Oakville. The ability to hire new workers at a lower wage rate was a key ingredient in the business case Ford Motor Co. of Canada Ltd. made to its parent company to get a $700-million investment that led to a new generation of crossover vehicles being assembled at the Oakville plant. Ford Canada has hired about 2,200 new employees at the lower pay rate and now has about 5,000 employees in Oakville.
But one of those employees, who spoke on condition he not be identified, said he cannot make ends meet at the lower rate of pay unless he works overtime.
"I don't want to be working six days a week," the worker said. "We shouldn't have to depend on overtime, that's the bottom line."
The clamour among Unifor Local 707 members for a richer deal than the GM settlement, however, sets up a conflict with Local 200 of the union in Windsor, Ont., where Ford operates two engine plants and employs about 1,600 people.
One of those plants is on the endangered list because no new engines have been allocated to the factory. If it is to have a future, it requires new investment by Ford to preserve about 600 jobs.
Local 200 is worried that a potential strike over pay could lead Ford to refuse to make new investments in the Windsor engine plant.
"Nothing is more important than the jobs," said Chris Taylor, president of Unifor Local 200 and head of both Unifor's auto council and its Ford bargaining committee.
The council, composed of leaders of all Unifor auto locals, agreed this summer that investment by the Detroit Three companies in their Canadian plants was the crucial demand in this set of negotiations. The Ford bargaining committee agreed that investment in Windsor was at the top of the list in the negotiations.
"Investment in Windsor is the priority and we are not going to lose sight of that," Mr. Taylor said. Ford has already expressed concern to the union about the impact the wage increases in the GM contract would have on its competitive position in Canada, he added.
A bulletin signed by Local 707 president Dave Thomas said investment in Canada was the No. 1 priority when the union opened up bargaining, but union leaders agreed a strong economic package – stronger than the GM deal – is also important for the Ford workers.
Mr. Dias pointed to the GM pact's $12,000 in bonuses and almost $7 an hour worth of wage increases over the next four years for employees with one to two years of experience.
"Somebody is going to have to explain to me how that sucks," he said.
Teresa Hayward, who has worked for Ford in Windsor for 20 years, noted some members of Local 200 are still on layoff because of slow production at the Windsor engine plant.
"Ford Windsor wants product. Ford Oakville's new hires want equal pay for equal work (which they deserve)," she said in an electronic message. "Oakville has the numbers to control our vote. Hopefully, we will come together and satisfy all the existing issues."