July 28, 2008 / 6:31 PM / 9 years ago

GM offers incentives to Ontario truck plant workers

TORONTO (Reuters) - The Canadian Auto Workers union said on Monday it had reached a deal with General Motors of Canada (GM.N) that would help offset the closure of GM’s Oshawa, Ontario truck plant and included incentive packages and two new vehicle models for the adjacent car plant.

“We have made the very best of a very terrible situation,” Chris Buckley, CAW Local 222 president, told workers in Oshawa in an information session about the deal.

In 2009, GM will shutter its truck plant in Oshawa, about 30 minutes east of Toronto. The ailing automaker had announced the planned closure in June, two weeks after signing a three-year collective bargaining agreement with the union.

The union said GM had agreed to keep the plant, which employs about 2,600 people, open for the life of the contract.

The CAW responded with a 12-day blockade of GM’s Canadian headquarters in Oshawa. A provincial Superior Court judge ordered an end to the blockade, but also chided GM for the reversal, which he said could poison future bargaining between the two sides.

The company will now offer employees at the plant retirement incentives of up to C$100,000 ($98,000) for production workers and up to C$120,000 for trades workers. Car vouchers worth C$35,000 will also be offered.

Those not eligible for retirement will be given buyout offers, the size depending on the amount of time the employee has worked at the company, plus car vouchers.

Workers with at least 26 years seniority will be given the option of taking 65 percent of their wages for four years so that they reach the 30-year retirement benefits level, while those with 27 to 30 years would get proportionately less.

Detroit-based GM said it honor the product commitments reached with the union in bargaining, and that it would earmark two new car models for the Oshawa flexible car plant.

The plant will soon begin assembling the rear wheel drive Camaro, and a front wheel drive version of the Chevrolet Impala. It will also produce two as-yet unnamed front wheel drive vehicles, one to be launched in the fourth quarter of 2010 and the other in 2013.

A GM spokesman was not immediately available for comments.

($1=$1.02 Canadian)

Reporting by John McCrank; Editing by Bernadette Baum

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