CAW-CANADA / CHRYSLER BARGAINING REPORT

BARGAINING REPORT SEPTEMBER 2012 CAW - CANADA / CHRYSLER

H I G H L I G H T S O F T H E T E N T A T I V E A G R E E M E N T B E T W E E N C A W - C A N A D A A N D C H R Y S L E RPRODUCTION AND SKILLED TRADES SEPTEMBER 2012

B A R G A I N I N G R E P O RTCAW-CANADA / CHRYSLER

Under globalization, companies havebecome more aggressive than ever. We try

our hardest to improve wages, pensions, andworking conditions. But lurking in thebackground is the threat that the companies willmove somewhere cheaper, at the expense of theworkers and families they leave behind.

In the past, corporations had to meet certainstandards. Policies like the Auto Pact requiredthem to produce here if they wanted to sell here.And in most of the world, governments stillenforce sensible policies like that (in Korea,Brazil, China – and even the U.S., with its BuyAmerica Act).

Canada’s government, however, doesn’t believein holding companies to account, no matter howbadly they treat Canadians (as Caterpillar did).

Chrysler has done very well in Canada. Financialanalysts estimate Canada accounts for 27% oftheir worldwide profit. Their Canadian-madevehicles are excellent, and sell well. AndCanada has benefited enormously fromChrysler’s investments here.

Yet Chrysler executives hinted darkly they mightleave Canada if they didn’t win deep wage andcost cuts from their Canadian workers. Why

would anyone want to wreck a relationship thathas worked so well for both sides? Yes, the highdollar makes Canada look expensive. But thedollar helps Chrysler, as well: they can sell theirproducts (even Canadian-made vehicles) athigher prices here.

The CAW tried a brand new strategy in thisround of bargaining. We imposed a deadline onall three companies at the same time, hoping toentice someone to accept our broad frameworkfor a deal. Eventually, Ford stepped up to theplate, followed by GM.

But everyone knew Chrysler would be thetoughest. This partly reflects public statementsby the company’s management. It also reflects,to be fair, the fact that Chrysler is financiallyweaker than the others (though improvingsteadily).

The pattern contract we negotiated at Ford isnot overzealous. It was designed to work for allthree companies, thus preserving the levelplaying field that’s so important to allautoworkers.

We negotiated calmly and respectfully withChrysler, rebuffing the threats. We engagedseriously on productivity issues (which is, after

all, the most importantfactor in a company’slong-run success), andcreated a new grow-inprogram that isincredibly attractive fornew hiring. Eventuallythe company saw itsway to accept thepattern.

The discipline and solidarity of all Chryslerworkers, led by your elected bargainingrepresentatives, was essential to this victory.Now we’ll keep working to build the autoindustry in Canada. And we’ll keepcampaigning for better government policies sothat all workers are less vulnerable to corporatethreats.

I join all the members of your CAW-ChryslerMaster and Local Bargaining Committees inunanimously recommending this tentativeagreement for your ratification.

In solidarity,

Ken LewenzaCAW National President

WINNING THE PATTERN

MESSAGE FROM THE PRESIDENT Ken Lewenza

Fighting for the pattern

H I G H L I G H T S• Ratification bonus

• Cost of living lump sum payments

• Employment commitments

• Protection of current pensionbenefits

• No two-tier system

BARGAINING REPORT SEPTEMBER 2012 CAW - CANADA / CHRYSLER 2

MESSAGE FROM THE SECRETARY-TREASURER Peter Kennedy

MESSAGE FROM THE CHAIR Dino Chiodo

This was a challenging set ofnegotiations, with Chrysler insisting for

weeks on end that they could notaccommodate any deal other than a mirroragreement to the UAW. Your MasterBargaining Committee could not accept thispremise as a starting point.

Our goals going into the negotiations wereto ensure that Chrysler workers wererewarded for their efforts and sacrifices,and also to position our facilities well forthe future. We’ve succeeded on both fronts.Using the historic process of patternbargaining, we were successful in reachinga good agreement for our members.

Out of sheer necessity, we have not addedto fixed costs in order to ensure ourworkplaces are competitive within theNorth American operations. We were ableto achieve this while representing our

members and keeping the philosophicalprinciples of the union intact. Further, wewere able to provide modest gains to ourmembers, allowing workers to share in thesuccess of Chrysler Corporation throughCPI-linked annual bonuses.

Our Master and local committees workedday and night trying to push the companyon the issues important to all of us. Weknow that this process was stressful andfrustrating for everyone – for the membersof the Master and local bargainingcommittees, and for all our members in theplants. We appreciate the patience ourmembers have shown over these longweeks.

I want to extend my sincere thanks to ourmembers for their outpouring of supportduring this process through email, phonecalls, Facebook messages and other

avenues. Themembership in everyfacility wasunwavering in theirsupport for thebargainingcommittee –whichgave us strengthand greaterconfidence at thebargaining table. I’d also like to thank thecommittees who worked so tirelessly toreach this agreement. I join with the entireCAW-Chrysler Master BargainingCommittee in unanimously recommendingthis tentative agreement.

In solidarity,

Dino ChiodoCAW/Chrysler Master Bargaining Committee Chairand CAW Local 444 President

Standing up for our principles

Positioning ourselves for a strong future

As we entered 2012 negotiations, we allrecognized the many challenges still

confronting Canada’s auto industry: theovervalued Canadian dollar, turbulent financialmarkets, huge imports from Asia and Europe.

The union and its members cannot be blamedfor these problems. But we can’t ignore them,either.

So we took a balanced but principledapproach to secure jobs and positionourselves for new investment (recognizingthat investment decisions depend on manyfactors, not just labour). But we stuck to ourguns on crucial matters of principle, rejectingconcession demands and preserving our visionof fair, decent auto jobs for the future.

One example of this principled approach wascost-of-living protection. The companies alldemanded that COLA be removedpermanently (including the current 33 centfloat). We rejected that completely. Pastgenerations fought for the principle ofinflation-protection, and we were not going togive it up.

But we also recognized that fixed cost

increases right now (as would result fromnormal COLA wage adjustments) would hurtour case for future investments, given theCanadian dollar.

So we found a pragmatic compromise. Wekeep the current 33 cent float (remember, that33 cents an hour is worth $2750 over the next4 years). We keep the COLA language in ourcontract. The quarterly adjustments in June2016 are reinstated.

In the meantime, to offset inflation wenegotiated annual lump sum bonuses ($2000per year in 2013, 2014, and 2015). Our realincomes are protected, but our fixed costs donot increase. It’s a pragmatic, principledsolution.

Another example was our approach to newhires. We were determined to reject apermanent two-tier system. What’s at stake isnothing less than the future of Canada’smiddle class. If high-productivity jobs in theauto industry can’t pay decent wages andbenefits to support a family, then no-one issafe.

Instead of a two-tier system, the CAW

proposed to adjustour existing new hiregrow-in schedule.

Chrysler pushed us tothe wall on theseissues, but weresisted.

In sum, these wereincredibly challengingnegotiations. But weheld fast to our principles on issues like cost-of-living and two-tier, while confirming futureinvestment and jobs. That’s why I join withyour entire CAW-Chrysler Master BargainingCommittee in unanimously recommending thistentative agreement for your ratification.

In solidarity,

Peter KennedyCAW National Secretary-Treasurer


• Current retirees and surviving spouses will also stay at their current pension amounts.

WAGES RATIFICATIONBONUSWAGES AND COLA

Base Rates will remain unchanged for the life of the collective agreement. Current earnings:Team Member Trades$34.36 $40.58includes 33¢ COLA includes 33¢ COLAThe current 33¢ per hour cost of living allowance float remains unchangeduntil June 2016. Cost of living adjustments will be reactivated beginningwith the June 2016 COLA payment.

ANNUAL LUMP SUMSTo offset the impact of ongoing price increases on the cost-of-living, lump sumbonuses will be paid prior to the Christmas shutdown in:

• December 2013: $2,000• December 2014: $2,000• December 2015: $2,000

Total: $6,000

PENSIONS

Current Actives Basic Lifetime Special Allowance(per month per year of service) (per month to age 65)

Benefit Class A, B, C $68.00, $68.25, $68.50 $3,515Benefit Class D $81.00 $3,895

The terms of the pension plan remain unchanged for current members. The lifetime pensionand 30-and-out Special Allowance continue in their current amounts:

RECOMMENDATIONYour Master BargainingCommittee and all LocalBargaining Committees

unanimously recommendthis tentative agreementand urge you to vote in

favour of it.

TERMThis is a four-year agreement

which expires onSeptember 19, 2016 at 11:59 p.m.

The CAW has negotiated a ratificationbonus. Active employees, as of theMonday following notice ofratification, and members on theinactive roll who performed work forthe company between January 2, 2012and the Monday following notice ofratification will receive a $3,000bonus. This can be rolled into an RRSP.


INVESTMENT, PRODUCTION AND RESTRUCTURINGIn the course of negotiations the company and union discussedthe importance of ongoing investment in products and facilitiesas essential for supporting full employment and job security forCAW Chrysler members. The union acknowledged Chrysler's ongoing commitment to itsCanadian manufacturing footprint, including recent majorinvestments to refresh and renew product lines totaling $1.33billion since emerging from bankruptcy in June 2009: • Windsor: $300 million • Brampton: $1 billion • Etobicoke: $32 million

Job security provisions contained in Article 17.1 of the currentcollective agreement have been renewed for the duration of

this agreement. Consistent with these provisions the companyplans to continue to operate Windsor Assembly on three shiftsof production and Brampton assembly on two shifts ofproduction throughout the agreement, contingent on marketand business conditions.

Existing plans concerning the operation of Etobicoke Casting;the Office, Clerical and Engineering Unit; the Windsor SecurityUnit; and Chrysler Transport Inc. remain unchanged for theduration of the collective agreement.

Restructuring provisions and incentives in the event ofpermanent job loss have also been renewed for the duration ofthe collective agreement, consistent with current collectiveagreement provisions.

SKILLED TRADES

PAY PRACTICE IMPROVEMENTS

APPRENTICESHIP OPPORTUNITIESThe union was successful in re-establishing Chrysler’scommitment to our apprenticeship program, which both localand national apprenticeship committees negotiated. Chryslerhas agreed to make available 100 apprentice opportunitiesthrough attrition and business conditions between Brampton,Etobicoke and Windsor operations.SECTION 17.2 JOB SECURITY AND WORK OWNERSHIPThe CAW resisted the attempts by Chrysler to eliminate workownership language. The union was successful in renewingwork ownership language and that related to other localpractices.

PREFERENTIAL CONSIDERATION FOR LAID OFF CAWJOURNEYPERSONS FROM OTHER LOCATIONSThe union negotiated language where Chrysler would giveconsideration to laid off CAW journeypersons in possession of aCAW journeyperson card.LINES OF DEMARCATIONThe current lines of demarcation were maintained in this set ofnegotiations.SKILLED TRADES UNION EDUCATION PROGRAMFunding has been secured to continue with this valuableprogram for our skilled trades members.

• Health care contributions will be deducted from all Chryslerpay sources. For example, if a worker is off on S&A , IMP , SUB,they do not have to worry about being cut off from theirhealth care benefits.

• Upon implementation, all pay corrections will be made within24 hours of payroll being notified and will be paid at the fullnet amount of hourly pay.

• Effective January 2013, employees will no longer be receiving

paper pay statements unless they submit an application toresume paper pay statements. Electronic statements willcontinue to be available through Dashboard.

• Employees will be able to use the onsite kiosks to allowgreater than one vacation advance in increments of 40 hours,once programmed.

• Employees will also be able to use onsite kiosks to sign up forwellness events, once programmed.


INCOME SECURITYIncome security benefits aremaintained for the duration of thisagreement at the current benefit levels.

THE SPECIALCONTINGENCYFUNDThe Special Contingency Fund has beenrenewed for current programs at existinglevels.

CHILD CAREChild care subsidy is maintained.

INSURANCE BENEFITS

HEALTH CARE BENEFITSHEALTH CARE

• HEALTH CARE CONTRIBUTION: There is no increase to themonthly health care contribution amount.

• DENTAL FEE SCHEDULE: The Ontario Dental Association(ODA) Fee Schedule will be updated from 2008 to 2011effective January 1, 2013. A 2-year lag will continue over theterm of the agreement. Example: in 2016, the 2014 ODA willbe in effect.

• DENTAL HYGIENIST: A Dental Hygenist will now berecognized as a dental provider.

• PRESCRIPTION DRUGS: The union resisted companydemands to increase the co-pay and the out-of-pocketmaximum. The co-pay remains at 10% to a maximum of $310.

• OVER-THE-COUNTER DRUGS: The federal governmentintroduced a rule that medical plans covering OTC drugs, evenwith a prescription, will lose their tax-exempt status. In such acase, all health care benefits would become taxable to theemployee. To avoid this problem, effective January 1, 2013,

OTC drugs, other than certain life-sustaining drugs, will nolonger be covered under the health care plan. A schedule oflife-sustaining drugs will continue to be covered, includinginsulins, nitrates, allergy serums, injectable vitamins, diabetictesting agents, needles and syringes, and vaccines.

• LONG TERM CARE: Effective January 1, 2014 the maximumlong term care rate for new entrants will be reduced from$1,200 to $800 per month. Current residents of long term carefacilities, and those entering prior to January 1, 2014, willremain at current coverage levels (refers to current activemembers only, prior to retirement).

RETIREE HEALTH CARE ACCOUNTCAW members hired after May 4, 2009 and prior to ratification willhave a retiree health care account. The company will contribute$0.40 per compensated hour (to a maximum of 2080 hours) to theaccount. The company and the union will establish the terms for theretiree health care account.

All benefits, including Survivor Income Benefits, are maintainedat current rates.

Assembler Trades($34.03 hourly rate) ($40.25 hourly rate)

S&A $840 $990EDB under 10 years $2,955 $3,500EDB 10 or more years $3,250 $3,850AD&D $39,000 $46,250Life Insurance $78,000 $92,500

WORKPLACETRAININGPROGRAMCompany funding for the WorkplaceTraining Program is renewed.

Curriculum will continue to bedeveloped to reflect current issues.


NEW HIRE PROGRAM

New hires receive full health benefits, overtime premiums, andstatutory holidays (same as existing employees), as specified inthe collective agreement. New hires receive child care subsidyafter 1 year of seniority.

10-Year New Hire Grow-In Program

WAGE AND VACATION SCHEDULESeniority Wage Paid Vacation

(yrs. completed) (% base rate) (hrs)

Start 60 4%1 60 802 60 883 65 964 70 1045 70 1126 75 1207 80 1208 85 1209 90 12010 100 180

To enhance our opportunities for new investments and hiring inCanadian facilities without creating a permanent second classof worker, the CAW and Chrysler have agreed to a 10-Year NewHire Grow-In Program. This program avoids the permanenttwo-tier system first demanded by the companies, expandingour current 6-year grow-in. New hires start with a lowerpackage of wages and benefits and grow in to fullcompensation after 10 years.

The new Grow-In Program applies only to newemployees hired after ratification.

Wages start at 60% of the starting base rate and reach 100%after year 10 of seniority. Wages then catch up (as necessary) toany intervening base rate increases in subsequent years. COLA ispaid after the wage reaches the full prevailing base rate.

The pension for new hires will be a hybrid DB/DC plan, providingone-half of the defined benefit under the current plan, along witha parallel defined contribution plan. New hires will pay $1 perhour to the pension in years 1-4, $1.50 in years 5-7, and $2 in year8 and after (to a maximum of 2080 hours per year). Skilled tradespension benefits and contributions are 20% higher, consistentwith the traditional 20% wage and pension differential.

The 30-and-out pension with special allowance is still availableon or after age 55. No additional benefits are accrued after 30years of service or age 55 (whichever is later). 75% accrued DBpension benefit is allocated for the first 10 years of service(proportionate with the wage grow-in).

Income security: new hires receive short work week after 3 years(current practice), no SUB credits for years 1-5, half SUB credits foryears 6-10, and full SUB credits after year 10. New hires areeligible for incentives in restructuring events after 5 years.

Shift premiums: 50¢ for afternoons and $1 for midnights untilafter year 10 (when existing premiums will apply).

Retiree health benefits: these benefits are funded through acontribution of $1 per hour (phased in after year 10) to a grouptrust for new hires.

Other: new hires receive dependent scholarship benefits after 10years, a pro-rated life insurance benefit (proportional to wagegrow-in) in years 1-10, and no legal service benefits. Existinglanguage regarding LTD and S&A continues to apply.

Skilled trades: newly hired apprentices’ wages are specified inour apprenticeship progression. Newly hired journeypersonsbegin work at the full rate (as per existing practice).

Specific timing on the phase-in of final provisions after year 10will be confirmed in collective bargaining prior to the first newhires reaching 10 years seniority.


PAID HOLIDAY SCHEDULE: 66 DAYS DURING THE CONTRACTFriday, October 5, 2012 Friday before Thanksgiving*

Monday, October 8, 2012 Thanksgiving

Monday, November 12, 2012 Remembrance Day*

December 24, 25, 26, 27, 28, 2012 Christmas Holiday Period

December 31, 2012 Christmas Holiday Period

Tuesday, January 1, 2013 Christmas Holiday Period

Friday, March 29, 2013 Good Friday

Monday, April 1, 2013 Easter Monday

Friday, May 17, 2013 Friday before Victoria Day

Monday, May 20, 2013 Victoria Day

Monday, July 1, 2013 Canada Day

Monday, August 5, 2013 Civic Holiday*

Friday, August 30, 2013 Friday before Labour Day

Monday, September 2, 2013 Labour Day

Friday, October 11, 2013 Friday before Thanksgiving*



December 23, 24, 25, 26, 27, 2013 Christmas Holiday Period

December 30, 31, 2013 Christmas Holiday Period

Wednesday, January 1, 2014 Christmas Holiday Period

Friday, April 18, 2014 Good Friday

Monday, April 21, 2014 Monday after Easter



Monday, June 30, 2014 Canada Day


Friday, August 29, 2014 Friday before Labour Day

HEALTH AND SAFETY





December 24, 25, 26, 29, 30, 31, 2014 Christmas Holiday Period

January 1, 2, 2015 Christmas Holiday Period

Friday, April 3, 2015 Good Friday

Monday, April 6, 2015 Monday after Easter



Friday, July 3, 2015 Canada Day


Friday, September 4, 2015 Friday before Labour Day



Monday, October 12, 2015 Thanksgiving Day

Friday, November 13, 2015 Remembrance Day*

December 24, 25, 28, 29, 30, 31, 2015 Christmas Holiday Period

Friday, January 1, 2016 Christmas Holiday Period

Friday, March 25, 2016 Good Friday

Monday, March 28, 2016 Easter Monday



Friday, July 1, 2016 Canada Day


Friday, September 2, 2016 Friday before Labour Day


The Master Health and Safety Committee has negotiated anumber of changes that will help create safer and healthier workenvironments at Chrysler facilities and stay current withimportant related issues.

• National Joint Health and Safety Committee will nowreceive and provide recommendations on new or revisedpolicies and procedures; review emerging health and safetyissues such as psychological health and safety andnanotechnology, and provide recommendations.

• Arc flash training - continued training for electricians andengineers who are exposed to electrical hazards has beennegotiated.

• There will be a complete review of all current health andsafety training programs.

• Noise Abatement Program - noise exposure monitoringresults will now be maintained in medical files of exposedworkers.

• Environmental representatives will now have moreinvolvement in making recommendations concerning theenvironment, recycling and energy conservation, andparticipate in audits.

• Ergonomics – there will now be improved early interventionby ergonomic representatives in Chrysler facilities.

*Brampton employees will not observe the November 12, 2012, November 11, 2013,November 10, 2014, November 13, 2015 holidays but instead will observe theOctober 5, 2012, October 11, 2013, October 10, 2014 and October 9, 2015 holidays.

*Etobicoke employees will not observe the November 12, 2012, November 11, 2013,November 10, 2014, November 13, 2015 holidays but instead will observe the August6, 2012, August 5, 2013, August 4, 2014 and August 3, 2015 holidays.

TONY GRECOChairperson,Local 444,Windsor


Your CAW-Canada Master Bargaining Committee at Chrysler

KEN LEWENZAPresident

PETER KENNEDYSecretary-Treasurer

JERRY DIASAssistant to the

President

JIM STANFORDEconomist

WHITEY MACDONALDNational Representative

JO-ANN HANNAHDirector,

Pensions and Benefits

BILL MURNIGHANDirector, Research

PAT BLACKWOODDirector,

Skilled Trades

SARI SAIRANENDirector,

Health, Safetyand Environment

DAVE CASSIDYFinancial Secretary,

Local 444,Windsor

DINO CHIODOChairperson of

Master BargainingCommittee and

President Local 444

JACK JUNESkilled Trades

Chairperson, Local 444,Windsor

JAMES STEWART1st Vice President,

Local 444,Windsor

MIKE LOVRIC3rd Vice President,

Local 444,Windsor

ARDIS SNOWChairperson,Local 1285,Brampton

DAVE IRELAND1st Vice President,

Local 1285,Brampton

DUANE REAYSkilled Trades

Chairperson, Local 1285,Brampton

GERRY HARVEY2nd Vice President,

Local 1285, Brampton

LEON RIDEOUTPresident,

Local 1285,Brampton

JUSTIN MINELLOO.C. & E. Chairperson,

Local 1285,Brampton

FLORIN BUCIUO.C. & E. Chairperson,

Local 1459,Etobicoke

JOHN VALENTINIChairperson,Local 1459,Etobicoke

GARY TAYLORO.C. & E. Chairperson,

& President, Local 1498,Windsor

ROD MCGILLPresident & SkilledTrades Chairperson,

Local 1459,Etobicoke

MARIO MOCERIChairperson,

Chrysler Security,Local 195,Windsor

JASPAL BRARDistrict Representative,

Local 1285,Brampton

Documents

CAW-CANADA / CHRYSLER BARGAINING REPORT