(This story was updated September 18 with comments from Avcorp).
Roughly 300 workers at the Avcorp. Industries (TSX: AVP) fabrication plant in Delta have been locked out, according to the International Association of Machinists and Aerospace Workers (IAMAW).
According to a union press release, workers were locked out Monday without warning, following several months of unsuccessful bargaining to renegotiate a collective agreement.
“The company offered no rationale but simply served the union notice and proceeded with the lockout,” the IAMAW news release states.
But in a statement released September 18, Avcorp said the decision to issue a lockout came after four weeks of rotating strikes and an overtime ban.
"While Avcorp has endeavoured to remain open and continue production, unfortunately Avcorp is now at a point where it is unable to carry on its operations due to the continuing interruptions caused by these rotating strikes," the company states.
The last collective agreement between the union and Avcorp expired at the end of March. Avcorp said most of the issues around wages and benefits have been largely settled, but says the union wants to change the provisions around recall that it agreed to in 2013.
According to the union, the last offer the company made was rejected by 100% of its members, who voted in favour of a strike. The union is demanding better job security provisions.
“The two main issues are contracting out and seniority retention,” IAMAW spokesperson Paul Pelletreau said in a news release.
“Aerospace is cyclical work, and the workers want to know that if they are laid off, they maintain their seniority. A laid-off worker can have worked for 5 years, be laid off and then return and have to apply as if they had never worked there – it’s just wrong.”
The union also says it wants improved recall rights.
“In many cases, when IAM members at Avcorp are laid-off, their recall rights expire and they must start again as new employees, losing all wage levels and accrued benefits,” the union says in its press release.
“The last recall forced workers to take a pay cut of almost $4 per hour. A layoff period can last anywhere from two to four years.”
Avcorp says the provisions around recall rights were agreed to in 2013, and now the union wants to "roll back" provisions it agreed to in 2013.
"Currently recall rights for laid off employees last from 1 to 7 years depending on an employee’s years of service. The current recall periods are very generous. The Union is on strike in order to force Avcorp to reverse the status quo and go back to a time when recall rights lasted forever.
Avcorp is one of the B.C. aerospace companies that have had contracts associated with the Lockheed Martin Corp. (NYSE:LMT) F-35 stealth fighter jet program. Avcorp. won a $500 million contract to build the wing assemblies for the C Variant of the F-35, which is designed for aircraft carriers. The company specializes in manufacturing airplane components.
According to Avcorp’s most recent interim financial statements, the company recorded an operating loss of $2.9 million for the second quarter of 2019.