(Resource News International) — The workers at three Saskatchewan mines owned by Potash Corporation of Saskatchewan Inc. have been striking since Aug. 7, but the union representing the workers said they are prepared to strike “until we win.”
“We are prepared to strike until we win. We are prepared to strike one day longer than the company is prepared not to bargain,” said Stephen Hunt, Western and Northern Canada district director for United Steelworkers (USW).
The 487 workers on strike are employed at PotashCorp’s Allan, Cory and Patience Lake mines and are responsible for underground mining operations, as well as milling and shipping activities on the surface. They are represented by USW locals 7689, 7458 and 189.
Contract renegotiation is at the centre of the labour dispute. The workers’ previous contracts with PotashCorp expired on April 30 and the two sides have been unable to reach an agreement since then.
Part of the union’s demands include pay increases, but the real sticking point, according to Hunt, is a bonus proposal put on the table by the union.
The workers are asking for bonuses linked to the price of commodities. When commodity prices climb, as they have been over the past year, the workers would be entitled to a bonus that increases as values rise. Conversely, when commodity prices fall, the bonus would fall back down or end altogether.
The suggestion has not been well received by PotashCorp. According to the company, the offer put forward by USW would mean an annual bonus of $157,000 per employee. Hunt disputes that number.
“Obviously PotashCorp is confused about our proposal Why would we propose something that would put the company under so much stress? It is a ludicrous position that they’ve put out there and one that really suggests they should come back to the bargaining table to find out what (the bonus proposal) really means in the long term,” Hunt said.
The union has encouraged PotashCorp to contact other mines that already have a commodity price-linked bonus in place but to Hunt’s knowledge, they have not done so.
PotashCorp said the offer it has put on the table would make its workers the best paid potash workers in North America.
“So what?” Hunt asked. The CEO of PotashCorp is already one of the best paid executives in North America, he said, but he it still entitled to a bonus when commodity prices soar.
Although the two positions are still miles apart, the union has no plans to escalate the labour dispute. USW is not legally permitted to strike at other mines but Hunt says the Cory, Allan and Patience Lake employees have the support of workers at other mines in Canada, including financial support.
However, PotashCorp is already feeling the pressure of the strike, regardless of what the company claims, Hunt said.
“There is either reduced production or no production coming out of those mines. They can hide behind the claim that the mines are shut down anyways for maintenance but as soon as production drops, their sales drop and their customers have to access potash from other suppliers. That is the pressure right now, it is economic,” Hunt said.
According to information provided by PotashCorp, the Allan, Cory and Patience Lake mines account for roughly 30 per cent of the company’s potash production.
In an earlier interview, Bill Johnson, director of public affairs for PotashCorp, admitted the strike has impacted the company’s ability to service its industrial clients.
Roughly five per cent of potash produced by PotashCorp is sold to industrial customers, and because Cory and Allan are the two facilities that produce industrial potash, that segment of business has been the first to be affected, Johnson explained.
However, the company’s main potash market, the fertilizer industry, has not yet been impacted because fertilizer demand is naturally slower at this time of year, Johnson explained.
“As far as the agricultural market goes, we are in a bit of an off-season right now in terms of supplying those customers, so it is too early to see what the impact will be moving forward,” Johnson said.
Pressure will mount on PotashCorp as the strike continues, Hunt said. With fertilizer prices being as high as they are, the potash mines are like gold mines and as the pipeline empties PotashCorp will feel the negative impact of the strike, he added.
“One thing we do know is that these disputes are always settled sooner or later and the best way to settle them is to sit down and talk about it in order to find out what the sticking points are. This rhetoric about final positions is tiring and you can be guaranteed PotashCorp will change their position before this is all over,” Hunt said.
In the meantime, potash mining and milling operations started up again at the Allan mine on Aug. 25. Management from the Cory and Patience Lake sites were brought in to help run the Allan facility.
Contingency plans continue to be evaluated for the Cory
and Patience Lake facilities, although production typically does not occur at this time of year at Patience Lake.
The solution mining process used at that facility requires cold weather, meaning the mine typically only operates from October through to May.