Vale workers agree on five-year contract

Vale (VALE-N) employees, who work at nickel operations in Sudbury and Port Colborne, Ont., have voted about 75% in favour of a five-year collective agreement putting an end to one of the longest strikes in Canadian history.

The one-year standoff resulted in a deal for the United Steelworkers Locals 6500 and 6200 that includes wage increases, switching from a defined benefit to a defined contribution pension plan for new hires and a new structured bonus tied to the price of nickel.

The nickel bonus was one of the key points of contention between Vale and union members who in the past have added up to $20 per hour to their regular wage when nickel price was high. Now employees can earn up tot $15,000 per year in addition to their regular earnings.

“We congratulate our members for the determination, spirit and solidarity they demonstrated over the last year in their unprecedented struggle against this huge multinational corporation,” said Wayne Rae, Local 6200 president in a statement.

Although more than 3,000 people walked off the job (somewhat figuratively, as many had already been laid off due to summer shutdown) in July 2009, Cory McPhee, Vale’s vice president of corporate affairs, says about 2,500 will be back to work within six weeks.

The company estimates that about 500 people have retired over the last year but McPhee sasy the company isn’t sure how many people may have found alternative employment. “We don’t know if there are people who won’t be returning,” McPhee says.

The strike stirred up a lot of tension and animosity between Vale, the union and contract workers who went back to work during the strike. Adding to the fire was the fact that Vale, a huge Brazil-based miner only acquired the nickel operations when it took over Inco in 2006 for $19.4 billion in a hotly contested takeover battle.

“I think that any time you have a 12 month labour dispute it’s a very confrontational atmosphere,” McPhee says. “We recognize there are relationships with employees that will have to be rebuilt and with the union we want to work collaboratively with the union as well.”

Vale operations are currently operating at 50% capacity right now and will be a full capacity once everyone’s back to work.

About 120 workers at Vale’s Voisey’s Bay nickel operation in Labrador are still on strike. They’ve been fighting over a collective agreement since last August.