Unions using new tactics with parts suppliers

Job security, pensions increasingly at risk in current climate
By Danielle Harder
|hrreporter.com|Last Updated: 03/08/2010

Securing the future of workers in the auto parts manufacturing industry is getting decidedly more complicated, according to Rick Laporte, CAW Local 444 president in Windsor, Ontario, and it is changing the union’s approach to collective bargaining.

Take, for example, the last agreement the union negotiated for workers at Johnson Controls Inc. in nearby Lakeshore. As a final touch, Laporte asked Chrysler Corp. for a letter promising to hire the Johnson Control workers should the company lose its contract with the auto maker. Three months later, that very thing happened when Chrysler announced it would now get its overhead components, or headliners, from a company in Michigan.

“With the way supplier plants are today, they’re here today and gone tomorrow. There’s no way of getting any kind of security and it’s a war,” says Laporte. “The supplier could be good for three years, and then when the contract expires they’re forced to bid for it. Sometimes they just don’t get them — a lot of times they don’t get them — and away they go and a new company comes in.”

He says where job security was once found in length of a contract, agreements now include more provisions in case the company shuts down or moves. Last year, the CAW negotiated what’s known as a “supplier letter” with Chrysler. It allows the auto maker to move a parts supplier into its Windsor assembly plant where the work would be completed, but the jobs must stay with the supplier.

“That way we know the same workers will be inside the plant with us,” he says.

The union is also looking for more security with pensions. In the last round of negotiations with four other area suppliers — TRW Automotive, HPBO, Dakkota and Oakley — the CAW asked for portable pensions instead of a traditional pension plan. Starting this May, the companies will contribute 50¢ an hour for every hour worked, directly into an RSP.

“If a factory closes down, or a company goes out of business in three years, these workers have some sort of pension they can carry into the next place they go into,” says Laporte.

He adds that even the atmosphere of contract negotiations is changing, given the instability of the auto parts industry.

“You go into bargaining with these factories and you barely have an opportunity to build a relationship with the managers, with the people in that business,” he says, “so your approach is much different. It just lacks that personal bond or relationship-building that goes on between union and company.”

Laporte says, as a result, unions are making more demands from the outset.

“We have a number of places here in Windsor that closed up, left and owed workers money — vacation pay and severance pay,” he says. “They just walked out and gave [the workers] nothing.”

The union has taken legal action in some cases. Earlier this month, CAW Local 195 reached an agreement that will see 80 former workers at Aradco and Aramco, two suppliers in Windsor, share a $225,000 settlement. They are also expected to receive potential proceeds from an upcoming court case the company owners, Catalina Inc., filed against Chrysler for termination of its parts supplier contract.

When the plants abruptly shut down last March, workers were owed about $2.4 million in severance, termination and vacation pay. Employees briefly occupied the Aradco plant, but left after receiving some money from Chrysler. They also later blockaded both plants to delay an auction of company equipment.

“You approach it all a little differently today,” Laporte says.

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