City braces as Inco/Steel talks get underway (comment on this story)

LABOUR: As unionized miners go, so goes local economy, economists warn

Posted By CAROL MULLIGAN, THE SUDBURY STAR

Posted 3 hours ago

Virtually everyone in Sudbury will benefit if almost 3,500 hourly rated workers who are members of United Steelworkers Local 6500 can win a lucrative new contract with Vale Inco Ltd. in negotiations that begin today.

The Brazilian-based mining giant, which recently laid off more than 420 employees in Canada, may seek concessions at the bargaining table from their Sudbury and Port Colborne production and maintenance workers.

But, if they gain them, we will all suffer, says a Laurentian University economist.

"I'm hoping Sudbury will get a bigger share of the revenues through the future," said David Robinson on Monday. "That means I'm hoping the unions get it, because if they don't get it, we don't get it."

Bargaining committee members for the union and the company will exchange proposals at the Radisson Hotel on the first day of negotiations that traditionally continue almost until the current contract's expiry date, in this case May 31.

During the first six weeks or so, the emphasis is on contract language. It is usually only in the final week or two -- and sometimes only days before -- that monetary issues are addressed.

"We probably don't expect appreciable gains and we do expect the company to be pushing for concessions and hoping to get them," said Robinson.

But concessions aren't justified because nickel prices are in the same range they were when the current three-year collective agreement was signed.

While Robinson said he believes these will be tough negotiations, he said neither Vale Inco nor Xstrata Nickel believes "they're in for a period of bad times."

There are signs that metal prices are on the upswing.

The retail sector, particularly, should be hoping for "big gains for the guys in the union" because that is what makes money for it, said Robinson.

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"The commercial sector in this city depends on those miners' incomes ... It's not management that buys all those snowmobiles and boats," he said.

Brian Gatien, chair of the Greater Sudbury Chamber of Commerce, said whatever goes on at Vale Inco or Xstrata has a significant impact on the business community.

"Our members are certainly hoping that both the union and the company can come to a settlement, that Vale Inco can be profitable and that there's good employment there. That serves the business community and it serves the Sudbury community as well," he said.

Jean-Charles Cachon, another Laurentian economist, said there are small signs of recovery in the world economy and that could bode well for contract talks.

According to information he received Monday, there has been a slight recovery in personal spending and in orders for durable goods in the U. S.

"That's another important thing for our economy because durable goods use a lot of metals," said Cachon.

The economies of India, Russia, Spain and Japan are also experiencing slight upturns, he said.

Cachon said it will be difficult for Vale Inco to seek concessions from Steelworkers because the company "is still largely profitable. Prices have not been depressed below cost, far from that."

Canada is also facing a shortage of between 70,000 and 90,000 employees in the mining industry in the next few years. It will be difficult for companies such as Vale Inco to hire, so they had "better pay the best salaries they can."

Still, Cachon said he expects there will be plenty of posturing at the bargaining table from both sides.

"Everybody's going to cry they don't have enough and they're spending too much. But, at the end of the day, I think they will come up with something very substantial, very healthy, for both parties. Otherwise people are going to flee" the mining industry.

Sudbury New Democrat MP Glenn Thibeault is calling on bargaining committees with both Vale Inco and Local 6500 to be mindful of the effect a labour dispute could have on the community.

"This city has been through some very rough times lately," said Thibeault.

"With the economic situation the way it is right now, the whole city will be watching these talks; hoping and waiting for a contract to be worked out. If the company is reasonable and the union takes the same approach, I know a deal can be achieved within the next two months."

Local 6500 president John Fera, head of the union's bargaining committee, said he is looking for a contract that helps the union's future and Vale Inco's future.

Local 6500 vice-president Patrick Veinot, who is running against Fera in union executive elections set for Wednesday and Thursday, said he understands the community "is on pins and needles" as contract talks begin.

"We understand it's a lot of weight on the whole community," said Veinot, who has been involved in past negotiations, "and we are reminded (of that) every day when we are in bargaining by Wayne Fraser," director of USW District 6 for Ontario and Atlantic Canada.