GM cutting workforce by 1,000

By Graeme McNaughton/The Oshawa Express

The city’s economy is going to be hit hard by the loss of 1,000 jobs from the city’s largest employer, says the union that represents its workers.

Oshawa Assembly will see its workforce reduced by almost a third before the end of the year due to the loss of the Chevrolet Camaro.

With the next generation Camaro being produced south of the border in Lansing, Michigan, the plant will be going down to three shifts from four and offering retirement incentives to eligible hourly employees in an effort to bring the workforce down to 2,600 workers from approximately 3,600.

According to GM, 2,100 employees at Oshawa Assembly are eligible for retirement.

Regardless of the manner of how the jobs are being reduced, it will still have an effect on the local economy, says Ron Svajlenko, the president of Unifor Local 222, which represents the workers at Oshawa Assembly.

“The loss of 1,000 jobs in Oshawa will have a significant impact on our local economy. As a union, we’ve done a pretty good job and this is no different in the sense that we’ll be looking for incentives in retirements to mitigate the job losses, but don’t misunderstand the kind of impact this will have on the economy because this is 1,000 real good jobs gone,” he tells The Oshawa Express. “So yes, we will do our best for our members, but more importantly, the community of Oshawa and the people of this community should be crying out and asking ‘What the hell is going on?’”

Oshawa MP Colin Carrie says that while it is disappointing to see 1,000 jobs to be eliminated from the plant’s workforce, this announcement has been expected since 2012, when the Canadian Autoworkers Union – now Unifor – signed its last agreement with General Motors.

“During this last round of negotiations…the union had a huge role in this. Back in 2012, the Canadian dollar was at par, and in the last round of negotiations, all GM asked CAW to do was to match the (American union’s) contract, and they refused,” Carrie says. “I’m disappointed because we really need to put politics aside and get to the real issues here because last time, GM wasn’t bluffing and Unifor basically gambled with the jobs. Unifor lost and Oshawa lost.”

Svajlenko says he is not pleased with how Ottawa has handled the future of Oshawa Assembly.

“The reality is these people owned billions of dollars worth of shares and had a board member sitting on the board of directors for General Motors and never once asked General Motors to allocate a product to Oshawa, which is absurd,” he says. “That money – yours, by the way, was used to buy that – was lost when those (shares) were sold to simply balance the budget and weren’t used to their proper extent, which should’ve been to help the people of Oshawa and the surrounding communities of Durham Region to not have to face these types of hits.”

Carrie says that due to the nature of the shares held by the federal government, it couldn’t control what GM did, adding the Camaro’s move was in part because it would save money.

“These were non-controlling shares, and the decision to move was due to a lower cost of operating in Michigan,” he says. “We lost these jobs to Michigan, not Mexico. Having non-controlling shares in GM is not a substitute for having a competitive, low-cost business environment, and that’s really what we’re talking about here: jurisdictional competition between Ontario and the northern states.”

Svajlenko says the government’s non-commitment to GM in Oshawa was exemplified with the recent announcement that Crown entity Export Development Canada announced it would be loaning German automaker Volkswagen more than $500 million to help expand factories in Mexico and Tennessee, as well as construct a new plant in Mexico.

“They don’t build in this country, so I’m really questioning our representation both locally and federally as to why these types of decisions are made when 1,000 people lose their jobs,” he says. “It’s ridiculous. Absurd.”

Carrie says the idea that the Volkswagen investment won’t benefit Canadians is false.

“Financing agreements like this one have generated almost $49 billion in sales for more than 5,000 Canadian companies because what we do here in Canada is make parts. We sell them to manufacturers around the world. So the idea is that is basically incentivizes VW to use Canadian auto parts in their manufacturing,” Carrie says. “Maybe Unifor’s problem is that some of these companies aren’t union shops. Who knows. I don’t know why (Svajlenko) would be against assisting parts plants from selling and exporting Canadian auto parts to factories around the world and especially with a fully repayable loan.”

Jennifer French, the provincial representative for Oshawa, also says government inaction is at fault.

“Today’s announcement is devastating for our community, but what is even more devastating is that we saw this coming and the government did nothing,” French stated in a news release on the day the job cuts were announced. “For months we have called on the Liberal government to put our community at ease and adopt a comprehensive auto strategy, but instead they have sat on their hands. When they had leverage as one of GM’s largest shareholders, they opted not to use it.”

Retiring with a little extra

GM says it will be going the route of incentivized retirements in order to round up the 1,000 jobs that will be eliminated from the plant’s workforce.

“This affords us an opportunity to avoid layoffs,” states Stephen Carlisle, president of GM Canada, in a news release. “Qualified Oshawa hourly employees who elect to retire this year will do so with our deep appreciation for their years of outstanding work producing some of the highest quality and most reliable vehicles in our industry.”

The auto maker will be offering packages that were negotiated as part of the last round of collective bargaining in 2012.

“In this type of circumstance, the incentive package is either $50,000 and a $20,000 car voucher for regular employees, or if they’re skilled trades, it’s $60,000 and a $20,000 car voucher. So they have their full retirement package, plus that,” Dave Paterson, the vice-president of corporate affairs for GM Canada, tells The Oshawa Express.

“We’re in this unique situation where two thirds of our employees in Oshawa are eligible for that package, so there’s roughly…2,100 that would be eligible for that incentivized retirement package. What we do now is begin the process of a canvas of those employees to see if they’re interested in taking the package. If we can get 1,000 of them, then we can avoid layoffs of any of the younger workers.”

The last day of Camaro production in Oshawa is currently set for Nov. 20.

As of that date, five cars will be produced in Oshawa: the Chevrolet Impala, Chevrolet Impala Limited fleet and police vehicle, Buick Regal, Cadillac XTS and Chevrolet Equinox.

The decrease of 1,000 workers from the plant’s workforce won’t come all at once, Paterson adds.

“We have about seven or eight months to manage through this process. Nothing is going to happen in any big lump. We’ll determine how many want to take up on the offer and then there’s a process through seniority to manage who goes at one time,” he says. “It’s a very complex kind of challenge in the plant because as one worker leaves, you need to train up another to take on those types of rolls. So you don’t do it all at once; you do it over many months.”