Tentative 3-year deal ‘addresses each of our core priorities and provides significant, and in some cases ground-breaking, gains,’ Lana Payne says
September 23, 2023 08:20 AM
Greg Layson
A new tentative three-year contract between Ford Motor Co. of Canada and Unifor includes added engine production capacity in Windsor, Ont.
Unifor’s tentative deal with Ford Motor Co. of Canada includes immediate wage increases of up to 22 percent and a commitment to added engine production capacity in Windsor, Ont.
The automaker has also pledged to transfer workers currently on defined contribution pensions plans to the superior defined benefits plan in 2025.
In a summary of bargaining gains shared with members ahead of a planned ratification vote on Saturday and tomorrow, Unifor’s master bargaining committee said the agreement delivers on each of the union’s priorities.
“This three-year deal meets the extraordinary moment we are in. It addresses each of our core priorities and provides significant, and in some cases ground-breaking, gains for everyone — active and retired,” Unifor President Lana Payne and other officials wrote in an introductory note.
The tentative deal was unanimously approved by the union’s master bargaining committee late Sept. 19, a day after an initial strike deadline had past and six weeks after the start of bargaining.
Voting under way
But rank-and-file members must still vote to approve the agreement, which, given the labor climate and high expectations created by UAW demands in the United States, is no guarantee.
Unifor’s tentative deal with Ford offers considerable off-the-bat wage increases, pay hikes in each of the second and third years of the agreement and a compression of the previous wage grid.
Wages for starting workers in Canadian dollars, including a $1.21 cost-of-living allowance fold-in, will jump 22 percent as of Sept. 25, rising to $29.67 from $24.26 previously. For workers already at the top-end of the pay grid, wages will increase 13 percent, to $42.39 from $37.33.
(Note, the Canadian dollar is worth $0.74 in U.S. dollars at current exchange rates.)
Pay for workers at all levels of the wage grid will then rise two and three per cent at the start of the second and third years of the agreement.
The deal also halves the grow-in time for new workers. Under the previous collective agreement, new hires started at 65 percent of top-end pay and it took eight years to progress to 100 percent. The new tentative deal gives new hires 70 percent of high-end pay and shortens the grow-in time to four years.
Signing bonus
Active Ford members will also get a C$10,000 ($7,411 USD) “Productivity and Quality” signing bonus.
The tentative deal offers a path back to defined benefits pension plans for workers hired after 2016 as well. Members currently on defined contribution plans will be able to transfer to the more “stable and beneficial” defined benefits plan as of Jan. 1, 2025, according to the master bargaining committee.
A range of other improvements to both sets of pension plans are also included in the tentative deal.
Support for workers during retooling periods was another of Unifor’s key priorities heading into talks. To assist members during shutdowns, the supplemental unemployment base rate increases to 70 from 65 percent.
Notably, it will remain at that rate through the estimated eight-month retooling period for the Oakville Assembly Complex. That project is scheduled to start next year.
Production promises
While the Oakville plant already has a C$1.8 billion ($1.3 billion) investment commitment, the tentative deal also includes unquantified spending in Windsor.
Ford has agreed to upgrades that will add additional capacity to build the 7.3-liter engine at the Essex Engine Plant starting in late 2025, Unifor said. Work will run over three years, with tooling installation anticipated in late 2026 and the start of production scheduled for the first quarter of 2028.
Unifor will hold information sessions to walk Ford members through the tentative deal today.
Workers will have roughly 24 hours to vote on whether to approve the tentative agreement. The union plans to share the results of the vote tomorrow.
Editor’s note: This story has corrected the exchange rate for U.S. to Canadian dollars. An earlier version had an incorrect exchange rate.
