The Canadian Auto Workers tentatively agreed late Friday to new concessions with Chrysler LLC that will save the automaker C$240 million ($198.3 million) annually and help avoid a bankruptcy filing, union President Ken Lewenza said.
In exchange, the union got Chrysler and potential partner Fiat S.p.A. to agree to keep its two Chrysler assembly plants open even if bankruptcy is unavoidable, Lewenza said at a news conference.
General Motors and Ford Motor Co., which signed new CAW agreements earlier, have indicated their desire to get the same concessions as those negotiated with Chrysler, he said.
The agreement kept wages at about C$35 an hour. But the union gave up break time, bonuses, tuition reimbursement, some supplemental pay and semiprivate hospital rooms. As part of the plan, the union agreed to institute Fiat's manufacturing processes as well.
The CAW also negotiated the creation of a retiree health-care trust similar to the Voluntary Employee Beneficiary Associations established in 2007 with the UAW.
Terms need to be ironed out, Lewenza said. But Chrysler has agreed to capitalize the fund adequately to support the benefits negotiated, he said. The fund will save Chrysler money because it transfers the obligation to the trust for seeing that retirees get supplemental benefits beyond those offered by Canada's national health care system.
The agreement also allows students earning considerably less than veteran workers to work additional hours at Chrysler plants.
The union said the cuts were demanded by Fiat, which said it would not consider aligning itself with Chrysler otherwise. There was no immediate comment on the deal from Fiat.