Toronto, Ontario – Ford Canada and the Canadian Auto Workers Union (CAW) have reached an agreement on a Master Economics Offer that will now become the centre of an all-out collective bargaining aimed at reaching a tentative agreement between the two sides later this week. The current collective agreement expires on September 16.

For a full tentative agreement to be reached, the two sides must now agree on all local agreements, including skilled trades, health and safety and other agreements. That tentative agreement must then be ratified by CAW members at all Canadian locations.

Highlights of the master offer include a three-year contract, no changes in base wages, no two-tier system for wages, pensions or benefits, a “productivity and quality” bonus of $2,200 to be paid upon ratification, a reduction in vacation pay compensated with a special cash payment, cost-of-living payments frozen for the remainder of the current contract and the first year of the new one, inflation-indexed pensions, health care cost savings including increased drug plan co-payments by employees, and modest improvements in health benefits.

The offer also extends the life of Ford’s assembly plant in St. Thomas, Ontario to 2011. The product commitment was previously scheduled to end in 2010.

The CAW said that the offer includes a mixture of modest gains and cost savings that, in the Union’s opinion, will ensure that Canadian facilities over the life of the agreement “will remain in the ballpark for new investment opportunities.”

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