Government interference hampering talks: CAW, The contract talks being held in Toronto will be allowed to continue through May 31

The contract talks being held in Toronto will be allowed to continue through May 31

Grace Macaluso, Canwest News Service Published: Tuesday, May 19, 2009

Ottawa extends deadline for GM union deal to May 31


Chrysler pension plans may be underfunded by more than US$10-billion


WINDSOR, Ont. -- Federal and provincial governments are interfering with efforts by union and company negotiators to reach a cost-cutting contract aimed at preventing General Motors from going bankrupt, the Canadian Auto Workers said Tuesday.

"They continue to interfere in the process, making new demands all the time," the union's master bargaining committee said in an update to its membership. "Their lack of experience in labour relations, and their repeated threats to pull the plug entirely on GM Canada, have made this process all the more difficult."

The union also complained about the presence of another party in the talks -- the U.S. government.

"Some of the new demands placed on the CAW in this bargaining clearly originated south of the border," the union said. "Because the Canadian and U.S. governments are planning a joint effort to support GM's restructuring, we now face a dangerous attempt to enforce a ‘cookie-cutter' approach on our bargaining."

Pensions, in particular a multi-billion-dollar deficit in the GM pension plan, remain a sticking point in negotiations.

"If we accepted cuts in pension benefits today in a fruitless effort to subsidize an enormous deficit that we did not create, then every other pension plan will be in jeopardy too," the union said.

Earlier Tuesday, federal Industry Minister Tony Clement said the contract talks being held in Toronto would be allowed to continue through May 31.

Ottawa had previously set a deadline of last Friday for the two sides to substantially reduce labour costs in order for the company to receive long-term government aid in Canada.

GM and the CAW were making progress on some issues, while others were more problematic, Mr. Clement told reporters in Atlanta.

On Monday, CAW president Ken Lewenza said the two sides were nowhere near a deal. He said demands were reaching the union's limit, despite "incredible sacrifices" made by union members to help GM stay afloat.

"We're trying to get people to understand the significance (of those sacrifices), but we haven't been successful to date," he said.

"The provincial and federal governments are scrutinizing everything we're doing and (have) indicated very clearly that they expect more sacrifices made in the area of pensions and benefits . . . over and beyond what we did with Chrysler."

GM and the union must reach an agreement that satisfies conditions outlined by the federal government in order for the troubled automaker to qualify for an additional $6-billion in financial aid, or risk liquidation.

If no deal is reached, the federal and provincial governments have said they will cease providing financial support to the company, which would then presumably move into bankruptcy protection.

Windsor Star