Bombardier bracing for strike after Quebec rail workers reject ‘generous’ offer

MONTREAL – Bombardier is bracing for what could be a lengthy strike at its Quebec railcar assembly plant after workers rejected what the company characterized as a generous offer that raises wages and pension benefits and contained a commitment to invest in new technology.

“Don’t worry, we’ve got our contingency plans and we could go a long way,” company spokesman Marc Laforge said Thursday, hours after union members massively rejected Bombardier’s “final” contract offer.

He said the company has a long-term vision for the plant and has no immediate plans to transfer work to its other facilities in Thunder Bay, Ont., Plattsburgh, N.Y. and Mexico.

But he said Bombardier will meet its commitment to deliver 420 Toronto subway cars and interior finishings for 706 Chicago transit cars. It also has contracts for 100 multi-level New Jersey transit cars, 54 multi-level cars for Maryland transit, along with nearly 500 Montreal Metro cars, which aren’t yet in production.

Nearly 90 per cent of the votes cast at a special meeting of the workers at the rail-equipment plant in La Pocatiere, northeast of Quebec City, were against the deal.

The six-hour meeting ended early Thursday morning and the results were published by their union, an affiliate of the Confederation of National Trade Unions.

Subcontracting, pension and salaries have been the key issues for the 330 workers who have been without a contract since Sept. 30, 2011.

The strike, which started Nov. 1, is the first at the plant in 30 years.

Laforge said the offer includes a 12.5 per cent wage increase over five years, a $9-million pension plan contribution that would raise employee benefits by 18 per cent and a commitment to invest $3 million in new state-of-the-art laser welding technology that would return some jobs outsourced to the United States.

The investment would allow La Pocatiere to make the aluminum roof and sidepanels for the Montreal Metro and other contracts and stop doing less specialized work with carbon steel.

He said the company isn’t surprised by the contract rejection given that the union executive and negotiating team recommended such a vote.

While Bombardier (TSX:BBD.B) may be willing to make some adjustments, the final contract cost must be within the framework of its last offer, the company said.

“The table is set and whatever agreement there is … it’s going to be within what has been put on the table,” Laforge said.

“I don’t know how many employees these days are getting a raise of 18 per cent on their pension plan benefits through negotiations. That’s something pretty important and the salary raises that we’re ready to grant stand perfectly with what is given in the industry.”

Union president Mario Levesque is disappointed with Bombardier’s hard stand and belief that it can settle in for a long labour dispute. He said the union is prepared to return to the bargaining table at the conciliator’s request but only if the company is willing to negotiate changes.

“As soon as we get a call we are ready to sit at the table but not just to sit, we want to negotiate so things advance,” he said in an interview.

Levesque also called on the company to respect terms of a 2010 letter of intent that would guarantee hundreds of jobs related to the Montreal Metro contract.

“The workers want that their managers act responsibly and respectfully by honouring their signatures from that time.”

Laforge said Bombardier has a different interpretation of the work that must be completed at the plant, which is part of an integrated manufacturing model that has the best chance of succeeding against the competition.

He added that outsourcing beyond Bombardier Transportation’s network represents just 10 to 15 jobs and suggested the union is trying to move a grievance on the subject, which is slated to be heard next month, into the negotiations.

“It (the grievance) has nothing to do with negotiations. They are trying to bring that into negotiations.”

Meanwhile, Levesque said the union will respect an injunction granted late Tuesday that limits the number of picketers to 25 and requires unfettered access to the plant by about 200 non-union and management personnel.

On the Toronto Stock Exchange, Bombardier’s shares closed up three cents to $3.07 in Thursday trading.