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Alistair MacDonald
The Wall Street Journal
16 October 2012
TORONTO -- Two of Canada's largest private-sector unions agreed to merge Monday, an attempt to boost the firepower of organized labour as membership falls and Canadian workers face threats such as improved U.S. manufacturing competitiveness.
The Communications, Energy and Paperworkers Union of Canada said on Monday that about 90% of its members voted in favour of combining with the Canadian Auto Workers, which approved the merger in August. The new union will represent more than 300,000 workers in Canada's manufacturing, services, resources, communications and transportation industries, making it the country's largest private-sector union.
Dramatic cost-cutting in U.S. factories amid the recent recession has suddenly made many American plants more efficient, luring new jobs back to American shores. Meanwhile, Canada has recently had a strong currency, giving Canadian manufactured goods a relatively higher price when sold abroad -- and providing an incentive for businesses to make their overseas prices more competitive by holding down local costs.
Last month, the CAW was forced to make a set of fresh concessions with Detroit auto makers after its U.S. counterpart agreed to its own big pay and benefits concessions when it renegotiated its contracts. U.S. auto makers have complained that Canada had become one of the most expensive places to make cars in the world, an allegation CAW officials contested at the time.
Canadian union officials said the new union will be better equipped to battle the sorts of wage reductions and curbs on union practices seen in the U.S. They also say they will be able to better fight what they say are moves by the Conservative government of Prime Minister Stephen Harper to curb their ability to strike in Canada.
In the past year, Mr. Harper's government has either implemented laws, or threatened to introduce measures, that have ended labor disputes in sectors under federal jurisdiction, such as the transport system.
"It sends a very clear message to the Conservatives," Dave Coles, the president of CEP said at a news conference. "An attack against one will be [met by] a response from all of us."
A spokesman for the government didn't return calls seeking comment.
Unions in the U.S. and parts of Europe have already gone through waves of their own mergers to boost size and clout. The United Steelworkers, which says it has about 850,000 members, swallowed up unions representing workers in rubber, glass and paper. Labour experts say that while mergers have increased funds and the ability to mobilize larger numbers of members to vote in elections, unions still haven't been able to avoid concessions on wages and benefits in recent years.
Canada has the highest rate of union membership among big, English-speaking countries. Around 30% of Canadian employees are in unions, compared with 26% in the U.K. and less than 12% in the U.S. But Canadian membership has fallen from a modern-day peak of 40% in 1982.
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Kris Maher contributed to this article.
Source: http://online.wsj.com/article/SB10000872396390443854204578058692495880014.html
