Quick End To Lockout At Rio's Quebec Smelter Unlikely

[First published by Reuters 6 February 2012]

Rio Tinto's lockout of workers at its Alcan division's big Alma aluminum smelter in northern Quebec looks set to drag on, and the company said on Monday that no talks were scheduled.

"I wouldn't put a timeline to (talks) right now because nothing is scheduled," said Rio Tinto Alcan spokesman Bryan Tucker.

Rio Tinto Alcan locked unionized workers out at the 438,000 tonne smelter, in Saguenay-Lac-Saint-Jean, Quebec, on Jan. 1, after talks on a new contract failed. The old contract expired on Dec. 31 and the two sides had been talking since October.

Rio has been operating the plant with non-unionized workers at about one-third of capacity since early January.

The Anglo-Australian miner said on Friday it will restart two suspended lines of production at its Shawinigan smelter in Quebec, bringing that plant back to full production, although Tucker said the plant will only be back at full capacity in May.

Rio closed the lines, two of four at the 100,000 tonne plant, in late December after a major power problem.

The company has earmarked the smelter, which was commissioned in the early 1940s, for permanent shutdown in December 2014.

LOCKOUT CRITICIZED

The United Steelworkers union, which represents the more than 750 unionized workers at Alma, has sharply criticized Rio for the lockout and accused the mining giant of beginning "a major assault on workers and communities".

One sticking point is Rio's plan to increase the proportion of contract employees at the plant to 27 percent from 10.7 percent. The union says the contract workers would be paid half the wages currently earned by unionized employees.

"Accepting this demand would cause a dramatic downward economic spiral not only for the workers but for members of the community, which would see income, local business sales and tax revenues drop precipitously," said Daniel Roy, Quebec director of United Steelworkers.

The union is organizing a global campaign against Rio Tinto's and has letters of support from unions in Canada and beyond, said USW official Guy Farrell.

"This is a fight we are having for future generations. This is not a fight for those that are working at Alma right now," Farrell said.

Rio Tinto acquired the bulk of its Canadian operations through its $38 billion takeover of Canadian aluminum producer Alcan in November 2007.

MERGER BACKLASH

The USW and other unions have roundly criticized the federal government's approval of several foreign acquisitions of major Canadian companies, as acrimonious labor disputes have often erupted following the close of some of these deals.

Roughly 3,000 Ontario workers of Vale went on strike for nearly a year in 2009, while a separate strike at Vale's Voisey's Bay facility in Atlantic Canada lasted for about 17 months.

Vale acquired most of its Canadian operations when it bought Inco for C$19.2 billion in 2007.

In December, Canada and U.S. Steel settled a court case that started in 2009, when Ottawa sought to fine the company for breaking job-protection promises made when it bought Canadian steelmaker Stelco in 2007.

Last week, Caterpillar Inc said it would close its Electro-Motive locomotive plant in London, Ontario, and lay off at least 450 workers, after months of unsuccessful talks with the Canadian Auto Workers union.

Caterpillar acquired Electo-Motive for $820 million in 2010 and it was a part of its Alabama-based Progress Rail Services unit, which competes with General Electric Co and Bombardier Inc. Workers at the London plant have been locked out since the beginning of 2012.