Sunday, 12 July 2009

Strike looms at Vale Inco's nickel operations

More than 85 per cent of unionized workers reject company's final contract offer

Bertrand Marotte, The Globe and Mail

Strike action looms at the Sudbury, Ont. nickel operations of global mining giant Vale SA after unionized workers overwhelmingly rejected the company's final contract offer.

About 85 per cent of 2,600 United Steelworkers members who cast ballots in a ratification vote on Friday and Saturday voted against the offer and the union is in a legal strike position at midnight Sunday.

The conflict is occurring against the backdrop of a slump in demand and prices for nickel and other commodities in tough economic times.

“We find the results unfortunate and disappointing. We didn't want a strike and we thought we put forward a fair and responsible offer,” said company spokesman Cory McPhee.

Brazil's Vale SA acquired Canadian nickel giant Inco Ltd. – the previous owner of the Sudbury operations – in 2006 and finalized the transaction in 2007.

But Vale chief executive officer Roger Agnelli said recently that the Sudbury facilities are unsustainable at current cost levels.

Vale has been demanding major concessions from the 3,300 workers in Sudbury and contract talks broke down over such issues as revamping the pension plan and reducing a nickel bonus, which rewards workers when the price of nickel is high.

Officials for the United Steelworkers were not immediately available for comment Sunday.

Mr. McPhee denied the union's insistence that Sudbury remains profitable despite the downturn.

“It's simply not true. We lost $73-million in the first quarter of 2009. We've been up front through these negotiations that we need to structure the business for long-term success,” he said in an interview.

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