Interview with Steelworkers International President Leo Gerard About Sudbury Vale Inco Strike – by Heidi Ulrichsen

Northern Life, Greater Sudbury’s community newspaper.

In Steelworkers international president Leo Gerard’s opinion, every time his union or Vale Inco publicly criticizes the other, the further they get from ending the labour dispute between the two parties.

Steelworkers Local 6500 members were “insulted” when Vale Inco CEO Tito Martins recently published a letter on a company website, accusing the union of using racism and xenophobia to further its position, Gerard said.

For his part, Gerard admits he “blew his lid” when speaking about the letter at a recent Steelworkers’ rally.

“Neither one of us are going to resolve this by rhetoric,” he said.

“Each time we get each other ticked off, we’re only further from the settlement.”

Gerard spoke to Northern Life in person April 2 about issues surrounding the nearly nine-month-long Steelworkers Local 6500 strike in Sudbury.

Steelworkers Local 6200 in Port Colborne, Ont., which bargains along with Local 6500, has also been on strike against the company since July 13, 2009, and Steelworkers Local 9508 in Voisey’s Bay, Nfld., since Aug. 1, 2009.

He said Vale Inco is trying to bargain through the media and their website.

When mediated contract talks between the two parties broke off last month, Vale Inco had posted details of a contract proposal on their website before the Steelworkers’ bargaining team had even left Toronto, he said.

Gerard denies that the Steelworkers were trying to do the same thing when they recently released a 12-page brochure, distributed with local newspapers, entitled “Vale’s Unsustainable Approach to Canadian Mining,” he said.

While the brochure examines the company’s financial information, and how it affects workers, it doesn’t attempt to dictate to the company how a collective agreement should look, Gerard said.

Vale Inco, on the other hand, is “trying to negotiate by a series of threats and ultimatums,” he said.

“That’s not the right way to do bargaining. It may be the way some people think you ought to do it, but it’s not the way it gets done in the rest of the world.”

Lost in translation

Gerard said he is concerned that negotiators from Vale Inco and the Steelworkers are “talking past each other.” He said he doesn’t want another set of negotiations that’s “lost in translation.”

“I don’t mean that by not speaking the same words, but by not understanding what those words mean,” he said.

Gerard added that the Steelworkers have 8,000 bargaining units around the world, and he’s never experienced a set of negotiations in which local managers who have the power to make decisions are not at the bargaining table.

“I understand from published reports, and from comments I’ve heard, that in the last two or three weeks, Tito Martins has said he’s the decider. Well, that’s good. Then we know who we have to talk to.”

He said he also learned from the same local media report that Martins said all it would take to get back to the bargaining table would be a phone call or letter. The union has made that phone call, Gerard said, and has not received a response.

When contacted by Northern Life, Vale Inco spokesperson Cory McPhee said the company’s lead negotiator, Harvey Beresford, had received a phone call within the past week from the union’s lead negotiator, Steelworkers District 6 director Wayne Fraser.

“The negotiator for the union has spoken with the negotiator for the company,” although the phone call has not lead to the resumption of negotiations, McPhee said.

Sudbury ‘ought to be receiving a nickel bonus’

Vale CEO Roger Agnelli seems to have become a victim of “self-inflicted amnesia,” when he stated during negotiations last year that Sudbury is the company’s highest-cost operations, Gerard said.

When Vale took over Inco in 2006, they treated it like a sought-after prize, Gerard said. As for the cost of production, most of Vale’s other operations are open-pit mines, and there can be no cost comparison to hard rock, deep mines like Sudbury, he said. He added that the Sudbury ore body is one of the richest in the world, with every major type of mineral in abundance.

The federal government abdicated its responsibility when it sold Inco to Vale, Gerard said.

“This is a publicly traded company making a deal with a democratically elected government. What conditions (did) the government give Canada’s wealth to them? (The government) refuses to make those terms and conditions public,” he said.

“I’ve tried to find some legal way to get them to do that. The act is written in such a way that they don’t have to. When we pressed (federal Industry Minister) Tony Clement on it, he said ‘neither party can release the document without the permission of the other side.’”

This angered Gerard, who posed the question: “Where the hell do the Canadian citizens sit in all of this?”

If you’re going to allow a foreign company to acquire Canadian resources, the community — where the resources are located —should be receiving some benefit, he said. “Sudbury ought to be receiving a nickel bonus,” Gerard said.

“Here, our wealth is being taken out of our region, and the only thing that is being left behind are wages and the nickel bonus.”

Questioning Vale’s sustainability argument

Even so, Vale Inco is arguing that changes need to be made to the nickel bonus, among other aspects of the Steelworkers’ contract, to improve the company’s sustainability.

Gerard said the nickel bonus has never cost the company a lot of money.

“Over the eight years prior to the negotiations…as a percentage of the selling price of nickel, the average cost of the nickel bonus was 9/10 of one per cent,” he said.

“The highest point in that eight years was 2007, when nickel sold on average for the year at $16.98 a pound. The average nickel price bonus was 21 cents a pound, which works out to 1.3 per cent of the selling price of nickel. Nobody is going to tell me that’s not sustainable.”

The recent ratification of a contract between Steelworkers Local 2020 and Vale Inco proves that the company can offer a deal that can be ratified, Gerard said. He said the company ought to use the same process with Local 6500.

At the same time, he said he thinks the company made a good offer to Local 2020 to drive a wedge between the two unions. The company also put out a press release about the Local 2020 contract in Brazil to discredit Local 6500’s work to get Brazilian workers on their side, he said.

He added the union will continue to raise awareness around the world of Vale Inco’s actions in Canada — something which he hopes will pressure the company to negotiate.

“In every corner of the world where Vale has representation, workers will be expressing their displeasure at the company’s methods,” Gerard said.

“That has a global impact on them. We are communicating in the near future with all the analysts and investors that hold stock in the company about the facts — just the facts.”

As well, he said he expects the price of nickel to rise between $12-$14 per pound, as the economy improves, and this will also put pressure on the company to negotiate a fair deal.

When contacted by Northern Life, Scotiabank commodities expert Patricia Mohr said the nickel prices have been rising lately because the Vale Inco strikes in Canada have tightened nickel supplies.

Stainless steel production has also started to improve, Mohr told Northern Life, in an e-mail.

“I hope there is a settlement soon, as the length of this strike is hurting the Canadian economy and our reputation as a reliable supplier of high grade nickel products,” Mohr wrote.

While the strike has been long and bitter, Gerard said the recent mediated talks between the two parties have given him optimism, because some progress was made. Some contract issues were solved, and movement was made on others.

“We’re ready, willing and able (to negotiate),” he said. “We don’t have a position that’s buried in cement. (But) don’t hide behind the sustainability argument. It doesn’t hold water.”