The threat of a walkout last week by union members of the Canadian Auto Workers (CAW) served to force German tyre and auto-parts manufacturer Continental AG to back away from a concession-ridden labour contract at a research and development center in Chatham, Ontario.

Members of CAW Local 35 voted by 83% for a three-year renewal agreement at strike deadline 15 November in an accord that preserved full rights for new hires, including inclusion in a defined benefit pension plan, all other post-retirement benefits, and the same level of work benefits as existing staff.

The CAW branch union also won annual wage increases totaling over 9% for the three years, improved retirement incentives, and a signing bonus. The union represents 37 highly skilled workers employed at a research and development for engine management systems.

“We fought hard to preserve the rights of new hires and to prevent the creation of two tiers of workers in this workplace,” said CAW National Representative Richard Laverty. “This small group of workers stood together and pushed back numerous concession demands from this profitable and huge multinational corporation.”

The union agreed to take contract concessions in 2008 during the onset of the financial crisis and subsequent collapse of North American manufacturing segments. This came a year after Continental bought this and other automotive parts operations from Siemens VDO. Then, the Chatham plant made parts for emission control systems but with the sale to Continental, the German company cut the workforce and turned the operation into a R&D centre.