The Globe and Mail Report on Business November 14, 1996 FORD DEAL LIMITS OUTSOURCING -- CAW VOWS TO SPREAD FIGHT Issue expected to surface at other tables By Susan Bourette, Labour Reporter TORONTO -- The last of the Big Three Canadian auto makers has agreed to a deal that limits its ability to contract out work, a principle labour experts predict will become the rallying cry of the union movement across the country. Indeed, the ink had yet to dry on a tentative deal reached yesterday between Ford Motor Co. of Canada Ltd. and the Canadian Auto Workers when union president Buzz Hargrove vowed to entrench the same limitations on outsourcing at other bargaining tables. "If you fight, you can win," an elated Mr. Hargrove told reporters at a Toronto hotel where the negotiators had been in marathon talks until yesterday afternoon when the agreement was announced. "You can't win if you don't challenge managements' rights. . . . This will set the standard. It will be a major demand in all of our bargaining." The deal wraps up the triennial bargaining session with the Big Three car companies that has spanned the better part of the past three months. Ford has agreed to the same restrictions on the contracting out of work to auto parts companies as both Chrysler Canada Ltd. and General Motors of Canada Ltd. The deal between the union and GM was reached only after a three-week strike against the auto giant. The tentative three-year agreement--reached in advance of a 7 p.m. deadline--averted a walkout by nearly 12,300 workers at Canada's second-largest auto maker. However, late yesterday the two sides were still putting final touches on sections of the deal at local and subcommittee levels. Workers will vote on it this weekend. Don McKenzie, Ford's top negotiator, said the company was pleased to have reached an agreement that would allow it to work within its business plan in a competitive industry. The agreement provides wage increases of 2 per cent in each year of the contract. With cost-of-living improvements that adds up to 10 per cent over the life of the contract. The auto makers have agreed to replace any jobs that are outsourced with similar work. They have also agreed not to sell or close any plants over the next three years. With the pattern agreement now in place at all three companies, the CAW appears to have achieved its goals in this round of talks. In fact, some industry experts argue that key principles won by the union this year are perhaps the most significant gains made in more than half a century. Alfie Morgan, a business professor at the University of Windsor, says he expects limits to a corporation's ability to outsource work will now be a key demand by other unions across the country as companies continue to shed workers. "Other unions will have a very difficult time resisting this objective," Mr. Morgan said. "I anticipate this will be the major trend in the labour movement in Canada and eventually across the world." Mr. Morgan argues that challenging a company's right to manage its business--or place limits on contracting out--is the most significant gain made by unions since the so-called Rand formula of 1946 that was a result of a Ford strike. The principle introduced by arbitrator Ivan Rand, a judge of the Supreme Court of Canada, helped unions flourish by stipulating that all workers had to pay union dues whether they chose to become union members or not, because they received the benefits of working in a unionized workplace. "Buzz Hargrove has been tremendously successful in questioning the prerogative of the corporation to manipulate people only as a business variable," Mr. Morgan said. Charlotte Yates, an associate professor of labour studies and political science at McMaster University, said the CAW has often set standards of labour practice that eventually filter throughout the trade union movement. Ms. Yates said if the CAW tries to enshrine such principles in other deals it negotiates, other unions will try to foist limits on outsourcing on their employers--particularly because of the prominence of the issue on most companies' agendas. The CAW-Ford agreement also includes a ban on the sale or closing of all Ford plants in Canada, except Ford's Windsor, Ont., engine plant, which was announced some time ago and is being closed this month. The new agreement includes a buyout for some of the 600 workers at the engine plant. However, Mr. McKenzie told reporters that most employees are expected to be recalled in the next year to perform other work within its Windsor operations. Mr. Hargrove said he is optimistic the company will add a second shift at one of its truck plant. However, the company said it had no immediate plans to do so. The CAW represents about 52,000 auto workers in Canada, and about another 160,000 in the aerospace, transportation and fisheries industries, among others. The union currently is negotiating a contract with 16,500 workers at Canadian Airlines International Ltd., and has several contracts up for negotiation in the coming months.