Ford workers in Canada ratify new labor contract
Workers at Ford’s Oakville assembly plant voted on the contract earlier today. About 2,200 of the plant’s 5,000 workers are new hires. Photo credit: Reuters
UPDATED: 11/6/16 8:25 pm ET – adds statement
Ford Motor Co. workers represented by the Canadian union Unifor today ratified a four-year contract that includes a commitment from the automaker to invest more than $530 million (C$710 million) in its Canadian plants.
Unifor members approved the deal by a 58 percent margin, the union said in a statement.
With the deal’s ratification, Unifor’s negotiations with the Detroit 3 have come to a close. The Detroit 3 have committed about $1.2 billion (C$1.6 billion) in total to their Canadian operations.
“Our success in these negotiations should be a reminder to all employers and the government about the kind of jobs and economy that Unifor is fighting for,” Dias said.
The deal was ratified in large part thanks to overwhelming support from workers at Ford’s Windsor engine plants, which will receive about $613 million in investments for a major new engine program for some of the automaker’s top-selling vehicles.
About 89 percent of workers at Windsor voted in favor of the deal, compared with 45 percent of workers at the Oakville, Ontario, assembly plant, according to results posted on Unifor Local 707’s mobile app.
New engine program
The Windsor operation will be the “sole global manufacturing source” for a large engine displacement program, according to a highlights packet distributed to employees. Ford is also expected to build an updated 4.8-liter V-8 engine for the F-150 pickup truck in Windsor, the union said.
About $100 million will go toward mid-cycle refreshes of the Ford Edge and Lincoln MKT crossovers at the company’s Oakville, Ontario, assembly plant.
The contract, like those with GM and FCA off which the Ford deal is based, includes a $6,000 bonus, three $2,000 lump sum payments and two 2-percent wage increases for veteran workers. New hires remain on a 10-year wage grow-in period but will now receive pay increases each year under the deal, as a three-year wage freeze has been eliminated.
The continuation of the 10-year wage grow-in period drew the ire of many members at Oakville, where about 2,200 of the plant’s 5,000 workers are new hires. A divide between local union leadership in Oakville and Windsor over the pattern culminated last weekend, when Unifor Local 200 in Windsor criticized its Oakville counterparts for demanding a break from the pattern, a rare public display of disunity from Unifor leadership.
The margin with which the Ford contract passed was lower than the margins for the GM and FCA contract. About 65 percent of GM workers voted in favor of their contract, while 70 percent of FCA workers did the same.
Under the contract, new hires will be placed into a defined-contribution retirement plan, which passes much of the financial risk away from the employer and onto the employees. Workers will be required to contribute 4 percent of their earnings to the plan, which Ford will match. The same applied to workers in the Ford and GM contracts.
New hires will be placed on a defined-contribution retirement plan, seen as less risky to the employer than a traditional pension plan.
The Ford deal would create or save 519 jobs over its course, according to the highlights packet. Ford also agreed to hire “up to 75” skilled-trades apprentices between the Oakville and Windsor plants.
The ratification vote came hours after workers at seating supplier Integram in Windsor also went on strike. That strike will likely jeopardize production at FCA’s Windsor assembly plant and GM’s CAMI assembly plant in Ingersoll, Ontario, because they rely on just-in-time delivery of parts Integram produces.