Canadian union, Fiat Chrysler reach tentative deal

Michael Wayland
The Detroit News

Fiat Chrysler Automobiles NV and Canadian labor union Unifor reached a tentative agreement Monday night that includes hundreds of millions of dollars in new investments, including $325 million to rebuild Brampton Assembly plant’s paint shop.

The four-year deal, which must still be ratified by the roughly 10,000 Unifor-Fiat Chrysler workers during a vote Sunday, was announced by Unifor President Jerry Dias less than 10 minutes before an 11:59 p.m. strike deadline that would have stopped production at two assembly plants, a supporting stamping facility and a casting plant.

“This has been one very difficult set of negotiations,” Dias said during a news conference from Toronto, which was postponed several times as negotiations came down to the wire. “But as we as an organization has highlighted right from the beginning, 2016 negotiations were truly about the future of the auto industry in Canada because we had some major obstacles we had to deal with.”

Dias said the agreement follows the pattern set by the union’s contract with General Motors Co. That deal included a 10-year wage grow-in period with annual raises for new and recently hired members, a CA$6,000 signing bonus and CA$2,000 lump-sum payments in the final three years of the deal. It also includes 2 percent wage increases now and in 2019.

Total investment under the deal will be more than $400 million, Dias said. That’s less than the $554 million in plant investments under the GM deal. However, Fiat Chrysler recently spent $2.6 billion for the development and production of the Chrysler Pacifica minivan in Windsor.

As in the GM deal, new workers will have a defined pension plan. Current new hires have a hybrid pension with defined benefit and defined contribution portions.

Dias had previously said Fiat Chrysler was concerned about following the deal with the Detroit automaker because it would cost them too much. The company in the past year or so has hired about 1,700 new employees who would be part of the new 10-year wage grow-in period for new and recently hired members that includes annual raises that top out for assemblers at CA$35.78 an hour, up from CA$34.41.

Dias said a Saturday meeting in Toronto between the union and Fiat Chrysler CEO Sergio Marchionne is what led to the company’s investments and matching the economic pattern set by GM.

FCA Canada early Tuesday confirmed the tentative agreement had been reached. The company declined to comment on specifics of the agreement until after the union’s voting process is complete.

Unifor’s top concerns with Fiat Chrysler heading into negotiations were investments in the Brampton Assembly Plant and the Etobicoke Casting Plant. The plants, including a supporting stamping facility for Brampton, employ more than 4,000 people, including about 3,750 hourly workers.

Brampton Assembly produces the Chrysler 300, Dodge Charger and Dodge Challenger. The facility hasn’t received a major public investment since 2011. Fiat Chrysler did invest an undisclosed amount when the three vehicles were redesigned for the 2015 model year, but nothing close Windsor Assembly received for the Pacifica minivan.

Dias said discussions about a new platform for Brampton will happen during the life of the agreement. However, he said the same rear-wheel-drive architecture that underpins the current three vehicles are “good for another four-plus years.”

The deal also includes a “solution” to find work for upward of 200 workers who will be laid off due to work moving out of the Etobicoke Casting plant when the Dodge Dart and Chrysler 200 are killed.

Etobicoke’s roughly 500 workers produce aluminum die castings and pistons for virtually all of the company’s vehicles in North America.

If Unifor’s Fiat Chrysler members ratify the deal, the union will turn its attention to Ford Motor Co. Dias said a strike deadline for the Dearborn-based automaker will be Oct. 31.

Union workers at GM facilities in Canada ratified a four-year contract with Unifor, with 64.7 percent voting in favor of the agreement on Sept. 25.

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Twitter: @MikeWayland

Staff Writer Melissa Burden contributed.