Unifor reached a tentative agreement late Monday night with Fiat Chrysler Automobiles that includes a commitment to invest in the automaker’s assembly plant in Brampton, Ontario, and provides its workers with their first raises in 10 years.
The deal was reached after several days of intense bargaining and, if ratified by workers, includes a $325-million investment in Brampton for a new paint shop and $6.4 million to upgrade the automaker’s casting plant in Ebitocoke, Ontario, in Canadian dollars. It also includes $12,000 in bonuses and lump sum payments to workers over the life of the agreement before taxes.
Unifor also reached an agreement to save jobs of workers who will be laid off at the Ebitocoke plant. Those workers will be displaced because the plant makes parts for the Chrysler 200 and Dodge Dart and both of those cars are being discontinued.
“That decision will lead, candidly, to the layoff of up to about 150, potentially 200 of our members,” Dias said. “So what we have found is a solution to make sure that our members will not be laid off and will have employment opportunities in the Brampton assembly plant.”
The contract represents the second win in two months for Unifor, which began negotiations this summer worried that three plants in Canada operated by the Detroit Three could close in the coming years. For FCA, the tentative deal averts a possible strike that would have shut down its Windsor Assembly Plant, where it builds the popular new Chrysler Pacifica minivan.
FCA, in a statement, confirmed that it reached an agreement with Unifor but declined to make any additional comment.
“We were really deeply concerned about the fact that the paint shop at Brampton … is over 30 years old,” Unifor president Jerry Dias said at a news conference in Toronto. “Now, they are going to gut the existing paint shop and refurbish it.”
Dias also said FCA would provide a new platform for the plant in Brampton if quality continues to improve but declined to clarify what that meant. FCA builds the Chrysler 300, Dodge Charger and Dodge Challenger at the plant on a platform that hasn’t been overhauled in more than a decade.
The agreement will not be official until union members vote on the deal next week. After that, Unifor will turn its attention to Ford. The union has set a deadline of Oct. 31 to complete discussions with the Dearborn automaker.
Leaders of the Canadian union said negotiations with FCA went down to the wire and were completed only after overcoming a major hurdle. FCA, Dias said, was reluctant to provide the same level of wage increases that General Motors agreed to in a contract ratified last month by Unifor members, Dias said.
“This has been one very difficult set of negotiations,” Dias said.
In the end, FCA agreed deal that provides the same wages and bonuses. That means FCA’s 9,750 autoworkers in Canada will get a $6,000 signing bonus and $2,000 lump sum bonuses annually for the next three years in Canadian dollars. Workers also will get wage increases of 2% in the first and fourth years the contract.
The new contract also revises a 10-year progressive pay scale for newly hired workers who will now start at CA$20.92 per hour and will get a raise every year until they reach the top wage of CA$34.15 per hour.
Unifor, like the UAW in the U.S., historically strives to negotiate contracts with all three automakers that provide similar wages and benefits. The theory, called “pattern bargaining” is that the union wants the automakers to compete against each other based on design, quality, and engineering rather than based on labor rate advantages.
FCA objected to the GM pattern because its profits pale in comparison to General Motors and Ford and its profit margins are smaller.
“We reached the objective, which was a pattern,” Dias said. “The difficulty was getting them to agree to the pattern.”
Unifor began its contract talks with GM, FCA saying Canada’s entire auto industry is at stake in this year’s negotiations. Unifor is trying to secure investments at Canadian auto plants to prevent a further erosion of the automotive industry in Canada as plants have closed and the country has failed to attract new auto plants.
Dias got off to a strong start with GM when it won a CA$540 million investment commitment to upgrade the Oshawa plant and its St. Catharines, Ontario, plant.
Those upgrades will pave the way for GM to gain additional production volume for the Chevrolet Silverado at the Oshawa plant and build the Cadillac XTS as other cars and SUVs built at the plant are phased out. Most of the Silverado production will continue to come from GM’s plant in Fort Wayne, Ind.
Now Dias is celebrating his second tentative agreement with an automaker in two months.
“It’s my birthday today, I can’t think of a better way to celebrate my birthday than a $325-million investment for Brampton,” Dias said.
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