CAW union ratifies GM concessions

Tue May 26, 2009 9:55am EDT
 
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DETROIT (Reuters) - The Canadian Auto Workers union said on Monday that its members voted overwhelmingly in favor of a new contract with General Motors Corp that will put the company's labor costs on par with those at Toyota Canada's nonunionized plants.

The union said it made the concessions to help GM qualify for long-term financial aid from the governments of Canada and the province of Ontario.

GM workers in Canada ratified the new labor pact by a margin of 86 percent in favor, the CAW said in a statement.

The new contract will bring labor costs at GM's Canadian operations down to about C$57 ($50.90) an hour. That's a reduction of roughly C$22 to C$23 an hour when cuts agreed to by the union and GM in March are included.

"This has been a grueling restructuring process, and no one has felt that more than our members and retirees," CAW President Ken Lewenza said in a statement

"Although we were forced to make a number of important sacrifices, the support we received from our members is proof that they recognize the incredible challenges the industry is facing," he said.

The CAW said it had been told by the governments of Canada and the province of Ontario that unless an agreement was reached to significantly reduce labor costs, GM Canada would receive no future government financing.

Lewenza had said all indications were that GM would have to file for bankruptcy protection in the United States, but that it was less certain as to whether it would have to file in Canada as well.

The CAW represents about 9,000 active members at GM and more than 25,000 retirees.

(Reporting by Kevin Krolicki; Editing by Leslie Adler)

 
<p>Canadian Auto Workers (CAW) president Ken Lewenza speaks during a news conference to announce a tentative agreement to cut costs at General Motors Corp's Canadian operations in Toronto May 22, 2009. REUTERS/ Mike Cassese</p>