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The Magna-CAW Framework of Fairness Deal & Magna's Car Assembly Plant

by David Doorey June 5, 2009
written by David Doorey June 5, 2009

You may have noted the news recently that Magna is considering building a new auto factory in Canada if the company can obtain government loans.  To be honest, I’m not clear on whether the intention is to have a factory that just makes electric batteries for new electronic cars, or to build a brand new car assembly plant.  If it is the latter, it would move Magna from a parts supplier to a car manufacturer.
If Magna becomes a car-maker, an interesting labour law story emerges.  Presumably, the workforce would become a target of union organizing campaigns, mostly by the CAW.  But Magna signed a special deal with the CAW a while back in which it granted the CAW special union organizing rights in exchange for a more company-friendly collective bargaining regime if the employees vote to join the union.  This deal was called the Framework of Fairness.  One part of that deal included the CAW’s agreement to not strike Magna.  The deal was intended to apply to Magna’s car parts plants in Canada, but there is nothing indicating in that deal that it would not also apply to a Magna car assembly plant.  
If the CAW managed to organize a Magna car assembly plant under the Framework model, it would mean that the Magna plant would have a fundamentally different collective agreement and bargaining model than the remaining plants of the Big Three.  For example, the CAW wouldn’t be able to lawfully strike the Magna factory, but it could still strike Ford, GM, or Chrysler.   That could make for an interesting dynamic. The Big Three may very well expect a similar pledge that there will be no strikes or lockouts.   This is a point that York’s Sam Gindin made a while back in support of his arguments why the Magna deal was a very bad idea.   Recent rumblings by Magna about building a car assembly plant suggest that the issue may become a live one down the road as the auto industry continues its restructuring.

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David Doorey

Professor Doorey is an Associate Professor of Work Law and Industrial Relations at York University. He is the Director of the School of HRM at York and Director of Osgoode Hall Law School’s executive LLM Program in Labour and Employment Law and on the Advisory Board of the Osgoode Certificate program in Labour Law. He is a Senior Research Associate at Harvard Law School’s Labor and Worklife Program and a member of the International Advisory Committee on Harvard University’s Clean Slate Project, which is re-imaging labor law for the 21st century

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