TORONTO - Members of the Canadian Auto Workers union started voting Tuesday on a new cost-cutting contract with General Motors, with many members saying they supported the agreement, albeit reluctantly.
As thousands of GM employees gathered in the General Motors Centre in Oshawa, just east of Toronto, to vote on the agreement, many said they realized the deal was necessary, although that didn't make it any easier on workers.
"It's painful, but we gotta be realistic," said Doug Alexander, an electrician who has worked at GM's Oshawa assembly complex for 25 years and will soon be laid off.
"We're not going to survive without doing anything, even though it's not our fault, but the government says that's the condition (of the loans)."
The tentative deal between the union and the struggling automaker, announced Sunday after only three days of talks, includes a wage freeze to September 2012, the elimination of an annual bonus and a reduction in paid time off, among other concessions.
It is contingent on GM winning federal and provincial support, and depends on a promise that Detroit-based parent General Motors Corp. (NYSE:GM) will maintain 20 per cent of its total North American manufacturing volume in Canada.
The federal and Ontario governments have agreed to give GM Canada and Chrysler Canada billions of dollars to stay afloat amid slumping car sales, but only if all stakeholders -- including labour -- do their part to help the companies. Without government aid from Canada and the U.S., General Motors has warned it could go bankrupt.
Even with the loans, GM Canada plans to chop about 4,000 jobs over the next year with the closure of its Oshawa pickup truck plant in the spring and its Windsor, Ont., transmission factory in 2010.
The weekend deal covers 10,000 union members at GM's assembly complex in Oshawa and component plants in St. Catharines, Windsor and Woodstock, Ont.
CAW members in Oshawa and Woodstock voted Tuesday, with the rest of GM's unionized employees scheduled to vote Wednesday. The results are expected late Wednesday night.
Roman Karwowski, who has worked at the Oshawa plant for 33 years, said he voted in favour of the contract.
"In these tough economic times, you don't really have much of a choice," Karwowski said.
Retirees cannot vote on the new deal, but are also worried about the agreement because it scraps annual increases to pensions, said retired GM employee Jim Little.
"It's a shame, after you worked there 40 years and you gotta worry about your pension? It's a real shame," said Little.
Oshawa truck plant worker Karen Clark said she hopes that governments will recognize the workers' contributions and step in to help the struggling companies.
"It's difficult to have to make concessions when the reason that our industry's in this condition is not our fault," she said.
"But I'm going to stand behind my union. It has vowed to be part of the solution so I support them."
If the deal is approved, the CAW will begin work on negotiating similar deals with Chrysler Canada and Ford Canada.
GM and Chrysler have until March 31 to finalize restructuring plans, including deals with the union, in order to get access to the financial aid that has been promised by the two levels of government.
Ford has not asked for government assistance.
In a speech Tuesday in Toronto, federal Industry Minister Tony Clement said the recovery of the Canadian auto industry depends on American consumers, who buy most of the vehicles produced at Canadian car plants. Clement said that until people in the U.S. start buying vehicles, the sector will teeter on the edge of disaster.
The minister called the cost-cutting deal at GM just "one piece of the puzzle."
Clement said Ottawa wants to look at a range of issues, including how the company estimates its costs, before acting on a bailout.
The proposed deal would extend the current collective agreement for an additional year to September 2012, with no reduction in average assembly-worker base pay of $34 an hour.
It would eliminate a $1,700 annual "special bonus," and reduce paid time off by 40 hours a year from 80 hours; this time is in addition to vacation entitlements ranging up to five weeks annually for high-seniority workers, reduced last year from six weeks.
GM workers would also for the first time make payments toward their own health benefits -- $30 a month per worker family. The deal also would trim company funding of union-provided programs such as child care, legal services and wellness programs by 35 per cent.
18:19ET 10-03-09
