General Motors of Canada Ltd. and the union at the auto maker's Cami Automotive plant have reached a deal that freezes wages for the next four years, but will end the use of lower-paid supplementary workers at the plant, which is one of the company's most productive factories in North America.
The deal averts a potential strike at the plant in Ingersoll, Ont., which is producing Chevrolet Equinox and GMC Terrain crossover utility vehicles on three shifts a day and weekly overtime. Those are among the hottest-selling products in the General Motors Co. lineup in North America as the recovery in the U.S. market from the 2008-2009 recession grows more robust.
The new contract means about 300 supplementary workers will become full-time employees and their wages will begin progressing from $23.91 an hour to the top rate of more than $32 an hour during the four years of the agreement. Those workers will now also receive full health care and other benefits, although they will have a defined contribution pension plan instead of the defined benefit plan that other employees have.
Negotiations on a new contract began in March, but the issue of supplementary workers was a key sticking point between GM and the union because GM insisted they remain in place. The talks broke off for several months before being resumed earlier this month ahead of a strike deadline of 11:59 p.m. Monday.
The Canadian Auto Workers union, now known as Unifor after a merger with the Communications Energy and Paperworkers union of Canada, tried to eliminate the use of supplemental workers at GM operations in Oshawa, Ont., and St. Catharines, Ont., during contract talks in the fall of 2012. The union said GM was turning such workers into a permanent class of second-tier workers instead of using them only temporarily during new vehicle launches.
GM has agreed to stop using such workers altogether at the Cami operation.
But the new agreement is likely to create other temporary jobs at the plant, said Mike Van Boekel, chairman of the Cami unit of Unifor local 88.
Mandatory Saturday overtime shifts have been in place for the past four years, Mr. Van Boekel said.
But the new contract contains a clause that permits employees to receive 12 hours off instead of pay for those Saturday hours. Once people who choose the time off have accumulated 40 hours, they can take a week off.
That means they will have to be replaced temporarily, he said, although the numbers won't be known until the new contract has been in effect for some time.
Wages for existing full-time workers are frozen for the length of the four-year deal, but they will receive a $3,000 ratification bonus and a $2,000 Christmas bonus starting in 2014. The wage freeze and the bonus payments were part of the deals the union signed with GM Canada, Chrysler Canada Inc. and Ford Motor Co. of Canada Ltd. last fall.
The Cami unit has bargained separately with GM since the plant was built in 1989 and will continue to do so.
Meanwhile, construction continues on a new welding shop for assembly of the next generation of the Equinox and Terrain models later this decade.