Canadian Auto Workers (CAW) union National President Ken Lewenza speaks during the "We Are Ontario" rally organized by the Ontario Federation of Labour (OFL) in Toronto April 21, 2012. The rally brought dozens of different unions, labour groups, and activists from around Ontario to rally against the Ontario provincial Liberal party budget. (Photo : Reuters)
(Reuters) - The pace of Canadian Auto Workers' contact talks with Chrysler Group LLC and General Motors Co. slackened on Tuesday as the two automakers ran through the numbers in the tentative deal the union reached the day before with Ford Motor Co. that averted a strike.
After getting the deal with Ford on Monday, the union abandoned a midnight strike deadline and said it would negotiate with the two other Detroit-based automakers indefinitely as long as progress seemed in sight.
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The CAW said key economic issues were not being discussed on Tuesday as Chrysler and GM were still crunching numbers from the Ford agreement. It said it would strike with 24 hours' notice if the talks became deadlocked.
"Until we get into some meaningful dialogue on the economics - that's the key hurdle obviously - there's still a gulf until we know where the companies are at and what they're thinking and what kind of response that they're prepared to give," CAW National-Secretary Peter Kennedy said. "The important thing from my vantage point is we're still in the hotel, we're still talking, we've got a tentative agreement to model the other ones after, and our members are still at work."
The union, which represents about 20,000 workers at the Detroit 3 in Canada, had warned that it might strike all three companies simultaneously unless it got a contract deal with at least one of them before its midnight Monday strike deadline.
The CAW has not struck the three Detroit automakers since 1996.
Under the tentative four-year pact with Ford, 600 jobs will be created, but wages will remain frozen, and new hires will start at a lower hourly rate and take longer to reach the top level of the pay scale.
The agreement does not include any cost of living adjustment, but instead provides a series of lump sum bonuses.
New employees will also have a hybrid pension plan, which mixes defined benefits and defined contributions, but there is no change to the pension plan or eligibility rules for current members.
TIME TO REVIEW
"The companies have asked that they have some time to review the Ford deal," said CAW spokeswoman Shannon Devine.
Meetings at the sub-committee level will continue throughout the day, the CAW said, to discuss non-economic issues such as scheduling, or health and safety policy.
"We did go until about 3:30 in the morning and we did make a little bit of progress and we're going to continue to plug away for today entirely and we'll see if we can put more of the language together," said Dino Chiodo, chairman of the CAW's Chrysler master bargaining committee.
Labor costs have been the key sticking point in the tough round of negotiations.
The automakers say that Canada is the most expensive place in the world to make vehicles and costs must come down to match those of the United Auto Workers in the United States.
CAW workers at the Detroit Three earn an average of $34 in base hourly wage, compared with an average of $28 for UAW workers, the CAW says.
Including benefits, the CAW's total average labor cost is about $60 an hour, versus $58 for U.S. workers at Ford, $56 for GM and about $52 at Chrysler, according to the Center for Automotive Research.
The CAW is adamant in refusing a permanent two-tier wage scale, which the UAW accepted several years ago, saying its new workers must over time reach the same pay scales as existing workers. In the United States, they do not.
"The bargaining with the other two companies, GM and Chrysler, prior to getting the deal at Ford, we were still miles apart," said Kennedy. "We're still miles apart, but I'm encouraged by the fact we're still talking."