TORONTO (Reuters) - The Canadian Auto Workers union has offered the Detroit 3 automakers concessions on wages and pensions for new hires, a senior union official said on Thursday, as pressure builds to reach a contract deal ahead of a strike deadline early next week.
CAW National Secretary-Treasurer Peter Kennedy said the union has proposed a lower starting wage for new hires, and a longer “earn-in,” the time it takes to reach the top of the pay scale. But new workers would still eventually reach the same pay as existing employees.
“The important thing is that over time they would grow into the prevailing rate, so that we wouldn’t have a permanent two-tier system,” Kennedy said.
On Monday, a union source close to the talks said it might be possible to extend the earn-in from the current six years to as long as 10 years. Kennedy said he did not want to talk specifics.
The CAW has threatened to strike against Chrysler FIA.MI, Ford Motor Co (F.N) and General Motors Co (GM.N) simultaneously if it does not reach a contract agreement with at least one company by its strike deadline of 11:59 p.m. eastern time on September 17 (0359 GMT, September 18).
Kennedy said the union has also presented a new pension proposal for new hires. New workers would contribute to their pensions - current employees do not - but would still be entitled to a defined benefit, not a defined contribution pension.
Also on pensions, Kennedy said the union could relax the “30-and-out” provision for new hires. Instead of being allowed to retire after 30 years under any circumstances, they would be able to retire after 30 years only if they were above a particular age.
A Chrysler spokeswoman declined to comment on the developments. Ford and GM did not immediately respond to requests for comment.
With talks heading down to the wire, Kennedy said senior officials from Chrysler and Ford would join the negotiations on Thursday. He said GM already has a senior U.S. official at the table.
“It’s a sign that folks are taking this seriously,” Kennedy said. “There’s a lot of experience around all of the bargaining tables and if we can get behind the concepts we can get this done.”
Reporting by Allison Martell, Euan Rocha, Nicole Mordant; Editing by Frank McGurty; and Peter Galloway