Fiat Chrysler, Unifor Clear 'Major Obstacles' Before 11th Hour Contract Deal

A weekend meeting with Fiat Chrysler Automobiles CEO Sergio Marchionne led to a final-hour tentative agreement between the automaker and the union representing Detroit Three autoworkers in Canada, Unifor president Jerry Dias claims.

The deal, announced five minutes before Monday’s 11:59 p.m. strike deadline, means 3,500 Brampton assembly plant workers face a less uncertain future than before.

Bargaining teams faced “major obstacles” in reaching the agreement, Diaz claimed, with the last sticking point cleared a few hours before the deadline.

“This is happening because of Marchionne,” Dias said, crediting his “straight talk” with the CEO.

As part of the agreement, FCA has committed to a $345 million ($325 million CAD) upgrade of the Brampton plant’s paint shop, one of the oldest in the industry. The upgrade, described as a complete rebuild, was Unifor’s biggest investment demand in this round of bargaining.

“If you don’t have a paint shop, you don’t have a commitment to investment, and that creates incredible uncertainty,” Dias said. “Our members in Brampton have been on eggshells for years.”

The paint shop rebuild will begin during the summer shutdown of 2017.

FCA’s Etobicoke casting plant will see equipment upgrades as part of the deal, but job losses may still be in the cards. Some workers threatened by the demise of the Chrysler 200 and Dodge Dart will be moved to Brampton, with about 150 to 200 workers making the switch during the seemingly temporary slowdown.

Unifor uses pattern bargaining to seal contracts with the Detroit Three, meaning the first agreement guides the following two. FCA has agreed to the pay grid and pension changes seen in the recent Unifor-GM Canada deal.

The agreement sees traditional hires gain a 4-percent wage increase over the life of the contract. New hires will now see pay increases in each year of their 10-year pay grid, instead of staying static for the first three. Entry-level employees will gain a $6,000 signing bonus, plus lump sum payments, and those hired after September 16 will be enrolled in a defined contribution pension plan.

The issue of government funding came up, but Dias wasn’t talking dollar figures. He did say his team met with representatives from the Ontario government, and plan to meet with federal representatives soon. Dias claims there will be a “much broader discussion in Canada” about the auto industry in the years to come, and the sector “needs the government to participate.” Unifor “will be challenging the government over the long term,” he added.

All Detroit Three automakers could recoup some of their investment costs from provincial and federal auto industry funding programs. However, Dias said the deal wasn’t dependent on government money.

As for new products, Dias was tight-lipped. He praised FCA’s recent $2.6 billion investment in the Windsor assembly plant and the looming production of the Chrysler Pacifica Hybrid. Brampton, which builds the venerable Chrysler 300, Dodge Charger and Challenger, could go in any direction.

“It’s too early,” said Dias. “The existing product portfolio is good for four to five years.”