Autoworkers in Canada turned the corner this fall — just barely — away from years of contracts with the Detroit Three that protected the livelihoods of longtime members at the expense of the next generation.
In ratification votes at Ford, General Motors and Stellantis, Unifor members approved collective agreements promising demonstrably better gains to production workers at the low end of the pay scale. Wages for members with one year of seniority, for instance, will rise nearly 75 per cent over three years, while hourly pay for veteran workers will grow about 20 per cent.
The bottom-weighted deals are a reversal of a long-running trend that has seen automakers “create a wedge between the generations,” said Jim Stanford, director of the Centre for Future Work and a former economist at Unifor.
“They would say to the senior members — who are the majority when it comes time to ratify a contract — we’ll protect your benefits and your pensions, and for new people in the future, ‘Well, they’re not used to it, so we’ll give them something different.’”
To varying degrees, Stanford said, the strategy has been “gradually eroding” union gains dating decades. While the UAW in the United States fared worse by accepting a two-tier wage system, Unifor has also made concessions.
At low ebb, it took entry-level workers at the Detroit Three in Canada 10 years to reach the top of the wage grid, and they did so while paying into defined-contribution pensions, compared with the superior defined-benefit pensions of their peers. Defined benefits refers to how much retirement income employees get, while a defined-contribution plan only specifies what the employer and employee contribute to an employee’s retirement account.
Indeed, throughout the 2010s, the bedrock union principle of equal pay for equal work looked to be a thing of the past.
But Unifor’s latest set of agreements goes a long way toward reversing the trend.
They cut the time it takes to earn the top rate to four years and added income support during layoffs for workers with as little as one year of seniority. They also put all workers back on defined benefit pensions. There’s still a degree of separation between new and longtime workers, but it’s no longer a chasm.
The contracts send a signal that the union is ready to fight “not just for the current work force but for future generations,” Stanford said.
Yet that wasn’t universally popular.
Complaints from longtime workers about lackluster improvements to pensions and wages were legion. Those who were grumbling conveniently overlooked that they took home as much as 54 per cent more per hour than a new hire working the line next to them. This blowback — amplified by lofty demands from the UAW south of the border — came to a head at Ford Canada, where just 54 per cent of Unifor members voted to ratify the new contract in September. It’s no coincidence that 88 per cent of the Ford membership was already at the top of the pay scale.
Ratification went only slightly smoother at Stellantis in November; about 60 per cent of members approved. The deal sailed through at GM in October, with its more junior work force, with 80.5 per cent in favour.
Despite the short-term internal tension, the contract should help Unifor build solidarity long term. Without a wedge stuck between new and old workers, the union is free to fight for shared goals as opposed to conflicting ones.