WINDSOR -- About 7,500 CAW members working at General Motors in Oshawa, Windsor, St. Catharines and Woodstock, Ont., have voted overwhelmingly in favour of a new collective agreement, ratifying the deal by 86% after a series of meetings on Sunday and on Monday.
CAW President Ken Lewenza said on Monday the new deal should provide a much-needed sense of security to the thousands of active members and tens of thousands of retirees at General Motors in Canada.
"This has been a gruelling restructuring process, and no one has felt that more than our members and retirees," Mr. Lewenza said. "Although we were forced to make a number of important sacrifices, the support we received from our members is proof that they recognize the incredible challenges the industry is facing, but more importantly that they are prepared to stand by each other and stand with their union."
In Windsor, about 1,300 members voted 97% in favour of the agreement.
The deal, which was ratified in a series of votes on Sunday and on Monday, reduces costs by about $22 an hour for a total of about $57 an hour. It was the third time in the past year that the union had been in cost-cutting negotiations with the company.
The deal preserves base wages and pensions, as well as closure agreements negotiated for about 1,300 employees at the Windsor transmission plant. It contains many of the features of last month's cost-cutting deal with Chrysler, including creation of an independent health-care trust for current autoworkers and retirees. The new trust would help preserve and manage retiree health benefits not covered by the country's public health-care system.
General Motors has until the end of the month to come up with a restructuring plan to qualify for billions in additional government aid on both sides of the border.
GM is lining up labour deals, stability of its supply base, and government funding in preparation for bankruptcy protection, which could come as early as next week. The company would be split into good and bad parts, with Chevrolet and three other brands forming the base of a new company controlled by the U.S. government.
The Canadian government has so far pledged $3 billion to GM to help the company stabilize its operations in Canada. The automaker has drawn down $500 million of that amount. Ottawa and Ontario are expected to provide more funding to carry GM through any bankruptcy restructuring.
Ontario Premier Dalton McGuinty has said it is a "distinct possibility" that the two governments could take an equity stake in GM in exchange for debt, like they did with Chrysler LLC. The two governments offered Chrysler $3.7 billion to support its restructuring for a 2% share of the company and the right to name one of nine new board members.
The new agreement compels GM to use government loans to address a pension shortfall estimated at $7 billion, according to the union. The deficit was created after the company was granted an exemption in the early 1990s by the Ontario government, which allowed the automaker to underfund its pension.
Meanwhile, Kevin Gaudet, spokesman for the Canadian Taxpayers Federation, demanded greater transparency in how the loans are spent as well as measures aimed at ensuring the loans are repaid.
"We're going to ask for greater transparency and greater accountability measures," said Mr. Gaudet, who was slated to meet on Tuesday with representatives from the Prime Minister's Office. "And we'd like some commitment that if these companies default, that the governments actually do whatever they can to get the money back.
"Too often these companies in the past take loans and they don't repay, and they default or they just refuse to repay and the government doesn't go after them," added Mr. Gaudet. "Our research indicates that, on average, taxpayers only get back 17 cents on every dollar loaned."
Gaudet also accused the Stephen Harper government of breaking its promise that loans would not be used to help plug the multibillion-dollar hole in the GM pension plan.
"He's splitting hairs a bit; his defence is that federal funds wouldn't be used, the province's money is the money that will be put into the pension top-up. But, taxpayers' money is taxpayers' money, regardless of which pot it snuck out of."
Pema Lhalungpa, spokeswoman for federal Industry Minister Tony Clement, said there's been no change in the government's position.
"The interim loans are not going to the pension fund; that was a condition announced back in the day when we announced the interim loans. It's all there, it's very clear," Ms. Lhalungpa said.