Kitchener Frame Bankruptcy Could Undercut Retiree Benefits, CAW Says

July 7, 2011, 4:12 PM EST


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Retirees and surviving spouses at the former Kitchener Frame auto parts facility in Kitchener, Ontario are shocked and dismayed following the unexpected corporate bankruptcy filing by ThyssenKrupp Budd Canada Inc. The bankruptcy filing - submitted on July 4 - may compromise the post-retirement health benefits of over 1200 individuals.

"The company's decision is a shock and quite disturbing," said CAW President Ken Lewenza. The CAW represents the large majority of retired production, trades and office workers at Kitchener Frame.

"You can't tell these folks who have put their blood, sweat and tears into this company for so many years that their retirement health benefits are now in jeopardy and that they are simply out of luck," Lewenza said. "This would leave over one thousand our most vulnerable citizens in the lurch with no ongoing health benefits, including drug benefits."

The Kitchener Frame plant, once one of the largest employers in Waterloo region, shut its doors in April 2009, in the throes of the auto industry crisis. At the time of closure, and well before that date, ThyssenKrupp Budd Canada had committed to continue payments for post-retirement benefits - a commitment that may be compromised in bankruptcy proceedings.

"The company is saying it is ready to abdicate its responsibility to these former workers and their families," said former CAW Local 1451 President Mike Devine, who is also a retiree at Kitchener Frame.

Devine presided over a July 6 meeting at the Bingeman Conference Centre in Kitchener to discuss the company's position with 1000 affected retirees and spouses in attendance. 

"These people expressed their anger and shock at this decision. They feel betrayed, and rightfully so."

At the time of its closure the facility employed 500 CAW members. It manufactured frames for mid-sized sport utility vehicles. At its peak in the 1970s, the plant employed more than 3000 workers.   

The union is engaged in in-depth discussions with the company and the Bankruptcy Trustee with respect to fashioning a solution that best protects the interests and health care benefits of ThyssenKrupp Canada retirees and surviving spouses.

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