Unifor Deal With Ford Canada Squeaks Through

The contract with Ford workers includes a 15% pay rise over its three-year term and the first pension improvements since 2005.

Keith Nuthall, Director

September 25, 2023

4 Min Read
Ford Oakville screenshot
Contract guarantees income for Unifor members laid off during retooling for EVs at Ford’s Oakville, ON, plant.Getty Images

OTTAWA – With a new labor agreement with Ford of Canada in hand, the Unifor union turns its attention to negotiations with General Motors.

The union announced Sunday that 54% of its Ford members had approved the three-year deal finalized Sept. 19. The contract includes a 15% pay rise over its life and the first pension improvements since 2005.

This followed a last-minute improved offer from Ford, averting a planned strike across all its Canadian operations. 

Following past negotiating rounds, this pattern-setting agreement should be mirrored in Canadian labor deals now to be negotiated by Unifor with GM and Stellantis. Unifor announced Monday that it would target GM for its next agreement. The talks will cover about 4,300 Ontario workers at the St. Catharines Powertrain Plant, Oshawa Assembly Complex and Woodstock Parts Distribution Centre, with talks beginning Tuesday.

Lana Payne (pictured, below left), Unifor national president, says: “Our bargaining team showed exceptional leadership and successfully pushed Ford of Canada on every front. This contract will change lives in a profound way. It fundamentally transforms pension plans, provides protections during the (electric-vehicle) transition and includes the highest wage increases in the history of Canadian auto bargaining.”  

Lana Payne Unifor headshot.jpg

Lana Payne Unifor headshot

Ford also welcomed the deal and ratification. Bev Goodman, president and CEO, Ford of Canada, says: “This contract invests in our talented and dedicated employees, who remain consistently focused on the critical work of assembling our vehicles, building our engines and components, improving customer satisfaction and expediting parts delivery service to our more than 400 dealers. Together, we are ensuring our Canadian operations continue to deliver with the skills, knowledge and processes to compete and win.” 

Brendan Sweeney, managing director of the Trillium Network for Advanced Manufacturing, which raises public and investor awareness of Ontario’s advanced manufacturing ecosystem, including the auto sector, says some union members would have wanted more: “This will be the most lucrative agreement they have negotiated in a while. But I suspect people will be grumpy about it because they’ve negotiated it at a time when the pendulum is swinging back one way towards labor where it has not been swinging towards for 20 or 25 years.” 

Any grumpiness will have been tempered by awareness about the switch to EV production: “It comes after a year and a half of optimism and excitement and new investment and no one wants this to be the thing that puts things off the rails,” Sweeney says. Deal supporters understood it was “time to pony up and pay people a bit more money, but a prolonged strike could really sour investors against doing business in Canada,” he says. 

The wage increases are frontloaded, with an immediate 10% raise in year 1, then 2% and 3% rises in subsequent years. Additional skilled-trades adjustments of 2.75% immediately and 2.5% from September 2025 will also be paid.

New workers do well: One-year seniority hourly rates will move from C$25.75 ($19.12) to C$46.13 ($34.25) by 2026, up almost 80%, Unifor says. Also, a C$10,000 ($7,424) one-off bonus will be paid to all permanent employees following ratification, with C$4,000 ($2,970) being paid to temporary workers. 

On pensions, 7.2%-7.3% increases in the direct-benefit monthly rate per year of service up to 30 years will be paid; annual increases of between 7% and 7.6% for the more generous special allowance pensions; and similar increases for Ford hybrid pension plans mixing defined benefits and contribution-linked payments. Retirees will receive additional quarterly payments of between C$200 ($148.48) and C$125 ($92.80) to help with rising healthcare costs. 

On the transition to EVs, notably at Ford’s Oakville, ON, plant where the company plans an electric line by 2025, the deal involves increasing guaranteed incomes for workers laid off during retooling for up to eight months to 70% of their usual pay, up from 65% today, combining Canadian EI (employment insurance) benefits with Ford subsidies.  

The deal includes a commitment to add capacity for the 7.3L engine built at the Ford Essex Engine Plant, in Windsor, ON, with retooling from late 2026. 

And there are two additional scheduled paid holidays; improvements to dental, vision, physiotherapy, massage and other health benefits; life, disability and widower benefits increases mirror agreed pay increases; and there will be 150 new Ford apprenticeships in Oakville and Windsor. 

Stressing how pension conditions had not moved for 18 years, the union report says: “This is an exceptional deal. And it didn’t come easy. It was only in the eleventh hour that Ford came to the union with a substantive offer, and an openness to meaningfully address our priority concerns. They knew we had the leverage in talks. If we struck, the entire Canadian operation would come to a halt – and most of North America too.” 

About the Author(s)

Keith Nuthall

Director, International News Services

Keith Nuthall is an experienced journalist who specializes in international regulation and policy. He is based in Canada and the UK. He is director of B2B publication media agency, International News Services Ltd (internationalnewservices.com)

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