Chrysler Resumes Talks With Canadian Union

April 20, 2009
Ottawa and Washington demand labor concessions as part of a reorganization of Chrysler, in order for it to qualify for a bailout and to return to profitability.

The Canadian Auto Workers union accused Canada's government and Chrysler of taking advantage of an economic crisis to demand a 25% pay cut, as labor talks resumed on April 21. "They are trying to exploit the Canadian Auto Workers union," CAW president Ken Lewenza said.

"They are trying to destroy the expectations that decent wages, decent benefits and decent working conditions are attainable in 2009," he said.

Chrysler and suitor Fiat said last week Chrysler's Canadian employees must accept cuts of 19 dollars (US$16) to wages and benefits, or risk losing their jobs as Chrysler would shut down its Canadian plants.

Ottawa and Washington also demanded labor concessions as part of a reorganization of Chrysler, in order for it to qualify for a bailout and to return to profitability.

And Fiat said it would walk away from a tie-up with Chrysler if workers' salaries were not brought in line with Japanese and German auto plants in Canada.

Lewenza lamented that Chrysler bond holders, as well as owners Cerberus and Daimler have not been asked -- at least not publicly -- to make equal sacrifices.

"I find it frustrating that workers are responsible for seven percent of the total labor costs of a manufactured vehicle, yet for some reason, the Canadian government and the employers now have ganged up on us."

Suddenly, "we are the ones that are going to make or break the deal. That is just totally unrealistic," he said.

Lewenza also accused Chrysler bosses Bob Nardelli and Tom LaSorda of attempting to "undermine" the union by warning of Chrysler's demise in a letter to employees on April 17, if concessions were not accepted.

Chrysler estimates its Canadian workers currently earn hourly wages and benefits of 76 dollars (US$62).

The Canadian government has so far provided Chrysler with 750 million dollars (US$618) in bridge loans, and has agreed to provide additional support in proportion to monies it received from the U.S. Treasury.

Chrysler, which employs 9,400 workers in Canada has until April 30 to reach a deal with the union and submit a new restructuring plan to Ottawa.

Copyright Agence France-Presse, 2009

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