CAW says won't make deep cuts demanded by Detroit 3

Mon Sep 10, 2012 5:30pm EDT
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By Susan Taylor

TORONTO (Reuters) - The Canadian Auto Workers union said on Monday it is facing "unprecedented demands" in contract talks with the Detroit Three automakers and, with one week until its agreements with them expire, has no intention of making deep cuts.

The CAW has warned that it could strike Chrysler FIA.MI, Ford (F.N: Quote) and General Motors (GM.N: Quote) simultaneously if it cannot reach a new contract deal with at least one of them before all of the contracts expire at 11:59 p.m. eastern on September 17 (0359 GMT, September 18).

The union said in a bulletin to members that the companies are demanding that both current and future workers move to a defined contribution pension plan from a defined benefit plan and are also demanding the elimination of a clause allowing workers with 30 years' experience to retire with a full pension.

As well, the automakers want to create a two-tier workforce, the leaflet said, mirroring a concession they preserved in contracts with the United Auto Workers union in the United States last year.

The union may be willing to extend its "earn-in", the time it takes new hires to reach the highest end of the pay scale, from six to as many as 10 years, a union source close to the talks said. But the CAW has said repeatedly that permanently dividing workers into two wage classes is a non-starter.

The companies are also seeking the permanent elimination of cost-of-living adjustments and further reduction in benefits, such as prescription drug access, the union said.

It said the automakers are refusing to commit to any new production investments in Canada and that they are insisting that any reward or bonus that workers receive be balanced by cuts.