Chrysler Seeks To Cut Snowbirds' Health Costs

Chrysler Canada Inc. has an $80-million bill for health care for snowbirds, which the company is trying to reduce, in negotiations with CAW.

The bill is one slice of a $1.6-billion health care obligation the company has for its retired and active employees. Chrysler LLC president Tom LaSorda said in a memo to the managers of Chrysler's three Canadian plants the obligation is one of several elements of Chrysler's contract with the CAW that boosts its costs compared with United Auto Workers plants in the United States and General Motors of Canada Ltd. "The fact is, we must maintain our competitiveness and the current situation we are in requires that everyone participate," LaSorda said in the memo, was sent two days after he appeared before a House of Commons committee meeting and said the company might have to pull out of Canada. Chrysler is sticking to its position that it needs a contract with the CAW that goes beyond the concessions the union gave to GM Canada, if it's going to keep its plants in Brampton, Ont., and Windsor, Ont., operating. Related Articles "People have the right to know all the facts and then decide what to do," LaSorda said in the memo. "It's their choice. I don't want anyone to say 'you didn't tell me the whole story' if we don't stay competitive." Workers were apparently already angered by LaSorda's public comments in Ottawa, the memo and statements by the company last week that it was preparing contingency plans to shut down its Canadian operations; as a result tensions were raised before LaSorda met with CAW president Ken Lewenza last Friday for several hours before negotiations began officially on Monday. "We had what I would consider a pretty tough exchange, but a responsible exchange," he said. Apparently, the CAW maintained its stance that it will not go beyond the pattern agreement established at GM, while Chrysler was still insisting on the same concessions GM won, plus other items. Among the additional changes. LaSorda outlined in his memo were: Eliminating a week of paid time-off time at Canadian plants to match the five weeks at Chrysler's U.S. plants; Increasing Canadian retirees' cost sharing for health care to the UAW level, which is three times what CAW members pay; Ending tuition reimbursement for CAW members, because it is no longer available to UAW employees and salaried workers in Canada and the United States; Reducing break times at the Brampton and Windsor plants from 53 minutes and 56 minutes a day, respectively, to match the 40 minutes at GM's Oshawa, Ont., plants. LaSorda also referred to $80-million in health care liabilities Chrysler faces when it has to pay above provincial health care rates for retirees who live in Florida during the winter months and employees who go on vacation or seek medical care outside Ontario. There is speculation Chrysler wants to slash its hourly labour costs to about $57 from $76. "I'm not dealing with $19 an hour," Lewenza said yesterday. Lewenza claims he is focusing on making sure Chrysler workers in Brampton get the same wages and benefits as workers at GM's plant in Oshawa about 50 kilometres away.