Michelin Cutting New Hire Pay in Canada

(Akron/Tire Review – Nova Scotia Business Journal) New Michelin employees won’t be getting as much pay come May 1. The company told employees recently that it’s introducing a new pay rate scale, which will mean all new hires after the end of the month will make $3 less per hour. The reduction also includes flex employees, who will no longer get the regular full-time rate if they’re hired on or after that date.

By 2009, veteran workers who switch jobs on a different pay scale within the company will also feel the pay rate reduction pinch. One employee, whose name has been withheld, says many employees are “really upset” with the change. “No one’s happy about this,” said the 22-year veteran worker of the plant. “Everyone’s just stunned and flabbergasted. Not everyone’s a veteran like myself. It may not affect me, but it could if I wanted to switch jobs in the future. I’d lose $5 an hour.”

The man said the change has led to rumblings that another union drive will soon be imminent. He indicated that some workers were contacting the Canadian Autoworker’s Union to see if they’re interested in trying to unionise the employees again. “The company’s doing this because they think they know a union won’t come here and they can get away with it,” he said.

Previous union drives have failed, but he believes the company has pushed the workers far enough to change that. “The young people who were hired there in the past two years or so are really going to be hurting from this,” he said. “You wonder why we’re losing young workers to go out west – this is a perfect example of why.”

Sheri Somerville, manager of corporate communications for Michelin, confirmed the pay rate scale changes Thursday. “This doesn’t affect current employees,” she said. “Any new employees hired after May 1 will be on the lower scale.” The only way current employees will be affected, she said, is if they voluntarily move to a lower-paying position after May 1, 2009. If their jobs are switched by the company, however, they’ll remain at their current pay rate.

Michelin decided to make the change after the company began reviewing the market-based pay structure in the province for the production workers, she said. Salaried and maintenance employees were already on that structure. The decision was part of a way to reduce production-related costs, Somerville said.

“We’re very happy to be in Nova Scotia – things are going well for us and we have to keep focused on keeping the production costs low,” she said. So far, Somerville says she hasn’t heard much opposition from the workers. “It’s been positive so far – they understand we need to move forward and watch our costs.” There are approximately 3,500 production workers in Michelin’s Nova Scotia plants.