March 7, 2012 / 10:43 PM / 5 years ago

Canada's auto workers feel pressure in contract talks

TORONTO (Reuters) - The head of the union that represents Canadian employees of the Detroit 3 automakers said on Wednesday his union is under "incredible pressure" from them heading into bargaining for new labor contracts this summer.

Ken Lewenza, the national president of the Canadian Auto Workers, said that even though his union prefers set hourly wage increases and remains opposed to linking pay to performance, as has been done in the United States, it cannot ignore the fact that times have changed.

In last year's bargaining with General Motors Co (GM.N), Chrysler UAWREC.UL and Ford Motor Co (F.N) in the United States, the United Auto Workers agreed to performance pay and bonuses rather than across-the-board salary increases.

Lewenza said in an interview his company is under pressure to do the same.

"I think it's too early to judge the determination of the company," he said. "We have managed to resist what we call gimmick pay. But the UAW did something that we cannot ignore, considering where we are at today."

Agreeing to similar contracts in Canada would mark a major shift for the CAW, which broke away from the United Auto Workers in 1985, in part because it would not accept profit-sharing as the UAW had done.

"I'm guarded at this particular time, because the times are different," Lewenza said. "I don't want to, I want us to stick to the traditional way of compensating workers, with no gimmicks attached."

The stronger Canadian dollar has also put Canadian unions under particular pressure as it increases the cost of doing business in Canada for international companies.

Reporting By Allison Martell; Additional reporting by Ben Klayman in Detroit; Editing by Peter Galloway

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