MAC: Mines and Communities

Various articles on Inco strike in Canada

Published by MAC on 2003-06-04

Inco: we can't meet nickel contracts

Move could mean company takes harder line

By Carol Mulligan, The Sudbury Star

June 04, 2003

An announcement by Inco Ltd. on Tuesday that it won't be able to meet contracts for nickel, copper and cobalt could mean the nickel giant will take a "harder stance" in negotiations with striking production and maintenance workers, says a mining analyst.

Terry Orstlan, of TSO and Associates in Montreal, said word that Inco was declaring force majeure on some of its sales contracts, because of the labour dispute, "is not actually good news" for Local 6500 of the United Steelworkers of America.

Force majeure is a legal term that means circumstances beyond its control. "Now that Inco has seen the effects of the labour issue, obviously they are going to have a hardened position because all the damage and all the pain is basically out there," said Orstlan in a telephone interview.

Members of Local 6500 set up picket lines at Inco's 12 Sudbury plants at 12:01 a.m. Sunday, after soundly turning down Inco's settlement offer Friday.

Steve Mitchell, an Inco spokesman from Toronto, said the nickel contracts his company can't meet are mostly for nickel product used in stainless steel production, high-grade nickel alloys, alloy steel and in the foundry industry.

Cancellation of the contracts will also affect the feed Inco ships to joint ventures in Asia and to its refineries in Klydach, Wales and Port Colborne. Mitchell said no one should be surprised the company was forced to cancel some contracts this early in the labour dispute. For the last couple of quarters, Inco's nickel inventory has been "historically low." Inco will help its clients find "alternate sources" of nickel, said Mitchell.

"We have a lot of experience in the nickel market, not only as a producer, but also as a trader and purchaser," he said.

A spokesman for Falconbridge Ltd., Dale Coffin, said Inco's rival nickel producer would not be picking up the slack and filling Inco contracts. "We just don't have any more material," he said Tuesday in an interview from Toronto.

Meanwhile, the president of striking Local 6500 Steelworkers said he's "disappointed" about Inco's announcement - and not because of the effect it will have on negotiations.

"As Inco goes, so we go," said Local 6500 president John Fera.

But the situation with the cancelled contracts "certainly could have been avoided" had Inco been able to strike a deal with the 3,300 members of Local 6500, said Fera.

Contract talks began April 7, but broke down May 27 when Steelworkers walked away from the bargaining table in frustration over what they called the lack of progress on the key issues - pensions, wages and vacation time. Last-minute discussions over plans to try to cut the cost of health-care benefits for employees and retirees seemed to be the last straw for Steel negotiators.

Other than some informal talks between the union and the company, there have been no negotiations for more than a week.

Fera said the union is willing to go back to the bargaining table if Inco moves on two points - pensioners' benefits and members' pensions and wages. The Local 6500 president said there was "lots of movement" in the almost two months of contract talks.

"We moved 100 miles and the company moved an inch.

"That's the absolute truth. Concessions were on the table on Day 1 and they never left the table," Fera said.

Those concessions, as the union calls them, are the reason members are walking pickets lines.

Cory McPhee, a spokesman for Inco in Sudbury, said Tuesday that Inco recognizes "this (labour dispute) has to be resolved and we're open to that."

Emotions were still "running high" Tuesday, the second full working day of the strike, said McPhee.

"We remain open to talks."

He agreed members of Local 6500 had helped the company save money in the last three years and said the company had recognized that with the earnings-based compensation program implemented in the last contract.

Under that program, employees earned an average of $10,000 over the course of the contract.

In the meantime, Local 6500 has been staffing picket lines around the clock at the entrances to all of Inco's plants.

On Monday and Tuesday, strikers denied access to non-union and office and clerical staff with another union who tried to report for work.

Fera said the union is keeping those employees out for their own good because the plants are not safe. They are being operated by supervisory staff at a minimum level.

Inco officials, however, have said they have no fears for employees' safety should they report to work.

Dump Inco, buy Falconbridge, Toronto analyst tells his clients

Rival mining company in good position to benefit from Inco strike: mining specialist

By Carol Mulligan, The Sudbury Star

June 03, 2003

Falconbridge Ltd. could end up being the only "real winner" in the strike by members of Local 6500 of the United Steelworkers of America against Inco Ltd., says a Toronto mining analyst.

The analyst, who did not wish to be identified, said he has been talking to investors in the last week and telling them to "take money out of Inco and put it into Falconbridge."

Inco's chief rival is well-positioned to benefit from the strike because its contract with Mine Mill Local 598/CAW does not expire until the end of January, said the analyst.

Because of a six-month strike in 2000-2001, the local's contract, which normally would end in September, expires at a later date.

That will mean more security for investors, who may wish to park some of their money there for now, he said.

Last week, the analyst said he downgraded Inco stock from buy to hold. The strike could last six to eight weeks, another analyst said Monday, noting that Inco employees are among the country's best-paid hourly workforces and might not mind being on the picket lines for June and July.

"The hourly guys are in a good spot because the nickel price is up," said Kerry Smith of Haywood Securities in Toronto.

"So, that makes it more difficult for the company in terms of their negotiations."

About 3,300 members of United Steelworkers of America Local 6500 in Sudbury and Local 170 in Port Colborne went on strike Sunday morning after almost 95 per cent rejected a company offer.

The Sudbury complex produces nine per cent of the world's nickel; the strike affects about one-third of the mining giant's global workforce and half of its nickel capacity.

No talks were scheduled to resolve the first strike at Inco since 1997. That shutdown lasted a month, as did a 1982 strike. A strike that started in September 1978 lasted until June 1979.

"Right now, the problem is trying to deal with the large gap that exists between the company's and the union's respective positions," Inco spokesman Cory McPhee said.

Pensions were the main issue, McPhee said. With 45 per cent of Inco's Sudbury employees eligible to retire within three years, the company is facing a huge pension shortfall.

The union wants pension payments for employees with more than 30 years of service increased to $3,300 a month from $3,000.

On Monday, Inco's share price gained 68 cents at $28.80. Shares in Falconbridge gained 40 cents Cdn to $18.30.

6500 strikers close Inco facilities to other workers

By Carol Mulligan, The Sudbury Star

June 03, 2003

If striking members of Local 6500 of the United Steelworkers of America were looking for a showdown Monday morning, they didn't get it. Union and non-union office and clerical workers, who were told to report to work as usual Monday morning, were not allowed through picket lines. But the mood was restrained for the most part as picket captains politely, but firmly, refused to allow their colleagues to enter.

Employees who showed up for work made two or more attempts to get to their workplaces, but finally went home.

The marshalls who were trying to lead employees onto Inco properties indicated they would be back the next morning.

Local 6500 members set up picket lines at all 12 of Inco's operations in Sudbury at 12:01 a.m. Sunday, after two months of negotiating failed to produce a collective agreement.

The production and maintenance workers are being joined on picket lines by some of Inco's 10,000 retirees, who have said they feel betrayed by what they call the concessions Inco was seeking in its attempts to contain health-care benefit costs.

Retiree Wayne Stonehouse says Inco awakened "a sleeping giant" when it attempted to change health-care benefits for the nickel company's employees and retirees.

Even though Inco withdrew its controversial health-care management program from its settlement offer Friday, Stonehouse said he doesn't believe it's "off the table" for good.

"It will be back in three years," he predicted Monday morning, while walking the picket line at the main gate of the Copper Cliff Smelter. Stonehouse, 57, said, when he went on pension in 2000, "I thought my fight with Inco was over."

When contract talks began April 7, Local 6500's bargaining committee said the key issue was pensions, followed by wages and vacations/vacation pay. But talks broke down a week ago after Inco tried to introduce measures to contain health-care costs, which it says are skyrocketing, for both current employees and retirees and survivors.

And 90 per cent of the union's 3,300 members voted almost 95 per cent to reject Inco's final offer Friday night.

Stonehouse said he knows all about those benefits. He's had to access them plenty after being "all screwed up from working in the mines."

A long-time underground worker at Frood-Stobie Mine, Stonehouse had two heart attacks on the job and suffers from emphysema, although he said he doesn't smoke.

Marc Gammon was one of two picket captains on duty Monday morning at the entrance to the Copper Cliff Refinery and South Mine.

Uncharacteristically cold for June, Gammon joked that the weather "reflects the coldness of Inco."

In a more serious vein, he said the strike will undo two and a half years of collaborative efforts between the company and the union to control costs.

"We've saved a lot of money for Inco, we've made a lot of money for Inco," he said, adding relations had never been better between the company and its workers.

"It (the strike) is sad because we were working pretty well together."

Inco spokesman Cory McPhee said Monday afternoon the company was monitoring what was happening on the picket lines.

"We expect our employees (who are not members of Local 6500) to report to work and we are concerned they are being denied access," he said.

McPhee said the company does have some people inside to make sure the plants are maintained, and that will serve everyone's interests when the strike is resolved and Local 6500 members go back to work.

Inco has not filed for any injunctions to limit pickets, he said.

Meanwhile, predictions vary on how long Local 6500 members could be off the job.

President John Fera has said his negotiating team is ready to go back to the bargaining table if Inco is ready to move on its last offer. The two sides last met Friday morning, twice.

Northwatch Box 282
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Port Colborne residents protest Inco over alleged contamination of their air

Stephanie Levitz, Canadian Press

June 4 2003

Toronto - Generations of residents of the southern Ontario communityof Port Colborne took to the streets of Toronto on Wednesday to protest against Inco, demanding the giant nickel producer take action over high levels of the metal they say can be found in the air of their homes.

About a dozen residents calling themselves the Coalition Against Contamination first demonstrated outside a downtown hotel where Inco president Peter Jones was believed to be staying. The residents travelled from their community 150 kilometres southeast of Toronto to call attention to test results that show high amounts of cancer-causing nickel in the air
of their homes.

Inco says nickel levels in their homes are normal. The company says independent toxicologists are still reviewing residents' test results, but Inco has concluded only one home contains air contaminated at levels above the average range of normal homes in Ontario.

"There have been no studies that have been conducted yet that have indicated any risk to human health in Port Colborne," said company spokesman Steve Mitchell. "Those homes are safe. The air is safe." Port Colborne residents disagree.

"Since 1980, we have been getting sicker and sicker," Wilf Pearson, 72, said of himself and his wife Catharine, 60.

Pearson's daughter-in-law and several of his grandchildren were also on hand, holding up placards reading Hell No, We Won't Glow.

"Who knows what will happen to my children and grandchildren?"

Pearson's grandchildren all suffer from asthma and have recurring rashes that their mother attributes to the nickel levels.

By noon, the protesters had moved on to the Ontario legislature, where they accused the provincial government of doing nothing to push Inco to take responsibility.

Protesters said the ministries of Health and Environment are at odds over who is responsible for ensuring Inco cleans the inside of Port Colborne homes.

The political ball toss is letting Inco get away with contaminating homes, said protest organizer Diana Wiggins.

"It would be nice to see the government side with the residents," she said. "They need to force Inco to take responsibility."

Protesters made a final stop at Inco's Toronto offices. Two protesters attempted to meet with someone inside Inco but were turned away. Mitchell denied that the protester had asked to speak with anyone.

"They might be the Goliath but we still have a few stones left," said protester Angie Desmarais, 50. "We are not going to go away. This issue is not going to go away."

Port Colborne is the site of an old Inco refinery that processed more than 2.5 million tonnes of nickel oxide between 1918 and 1984.

The mining company has been locked in a battle over nickel contamination with the residents of the city since 2000, when the Ontario Environment Ministry identified higher-than-normal levels of nickel in the soil.

In late May, Inco released the results of its own air quality tests of 31 Port Colborne homes.

In a letter to residents, the company said "all of the homes that were sampled show nickel levels that would be considered safe and would not raise any health concerns."

Ten residents turned over their test results to lawyer Eric Gillespie, who represents 1,500 people from Port Colborne in a class-action suit against Inco.

Independent analysis of the results conducted by Mark Richardson, a health-risk assessor hired by Gillespie, showed that the total amount of nickel in the air was in some cases 3,400 per cent higher than acceptable Ontario standards.

Inco said it disputes the methodology used in Richardson's analysis.

Inco Test Results Confirm High Cancer Risks Inside Port Colborne Homes

Port Colborne, Ontario

June 4, 2003 (For Immediate Release)

Inco Limited has finally released indoor air testing results from 31 Port Colborne homes, delayed by Inco’s consultants since January. Previously Inco had claimed they would show the air in these homes is safe. “However, a review of the actual results shows the opposite. In many homes the air appears to be unsafe by all existing standards” said Eric Gillespie, a lawyer acting for approximately 1,500 residents.

The results were provided to Dr. Mark Richardson, former head of Health Canada’s Air and Waste section and an internationally recognized health risk assessor. Testing from eight of ten homes in the highest zone of contamination reveals at least half have significantly more nickel in the air than recent MOE monitoring found elsewhere in Ontario. Inco’s own testing in fact demonstrates the air inside many homes contains between 50% and 350% more nickel, with two having more than 3,400% more total nickel than the average Ontario community. “Inco’s consultants only compared the smaller particles that likely cause lung cancer, when larger particles are also known to be associated with nasal cancers in humans. You cannot ignore this risk” said Richardson.

Health Canada, the U.S. Environmental Protection Agency and the World Health Organization have all published recognized values for determining cancer risks. If these are used, residents in these homes are being exposed to long term cancer risks at least 4 times higher than Ontario standards allow. In some homes the risks are up to 290 times greater. Inco has admitted it has no scientific explanation for this extraordinary level.

However, rather than relying on internationally accepted standards, Inco is now suggesting that a single study conducted by two researchers in North Carolina be used to calculate cancer risks for Port Colborne. While Inco has denied any involvement in the study, one of its two authors is an employee of the Nickel Producers Environmental Research Association (NIPERA), a nickel industry association supported in part by Inco. The study was in fact funded by the same nickel industry association.

The study focuses on occupational exposures, which in the past Inco has said should not be used to calculate residential values. It has never been reviewed or accepted by any regulatory agency anywhere in the world. The study’s conclusions also focus on specific forms of nickel, when the Ministry of Environment has already determined the nickel in Port Colborne is a mixture of nickel oxide and other forms of nickel much closer to the nickel refinery dust used in Health Canada’s and EPA’s cancer assessments.

“Inco’s own testing has now shown high levels of nickel inside certain homes. These levels present elevated long term cancer risks to residents when assessed using internationally recognized standards developed for similar types of nickel to that found in Port Colborne. This confirms and vindicates residents and their experts, who have been saying all along that Inco is likely going to be faced with a very large scale clean-up including demolishing homes” said Gillespie. Later today residents will be protesting at the Scotia Capital Materials Conference in Toronto where Inco President and COO Peter Jones is scheduled to speak. Protests will also take place at the offices of Inco Board Members and Inco’s head offices.

For more information please contact Eric Gillespie at 416-593-4385 ext 225.


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