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PotashCorp workers ratify deal

Unionized workers at three PotashCorp mines in the Saskatoon area have voted to drop their demand for profit-sharing and end their 99-day strike.

Workers at PotashCorp’s Allan, Cory and Patience Lake mines, represented by the United Steelworkers (USW), voted Thursday to sign a new three-year contract retroactive to May 1.

The company’s new deal includes raises and other financial perks but makes no mention of the union’s proposals for worker bonuses based on either PotashCorp profits or the price of potash, both of which have risen substantially in recent months.

“The cost of the settlements does not differ materially from the final
offer put forward by the company in July, protecting PotashCorp’s long-term
cost structure at its operations,” the company said in a release Friday.

“Despite the global financial meltdown that happened in the middle of
this dispute our members maintained their determination and solidarity in
order to achieve a fair settlement with this very profitable company,” said Stephen Hunt, USW’s Western Canada director, in a union release late Thursday.

About 500 miners and above-ground processing workers at the three mines had been off the job since Aug. 7. Their management restarted limited production at the Allan mine on Aug. 25.

The workers’ approval ends a labour dispute which by itself was seen to strengthen market fundamentals for potash producers, by limiting supply.

In its third-quarter financial report last month, Saskatoon-based PotashCorp pointed to “historically low” inventory levels among potash producers generally, including its own record-low stocks of 212,000 tonnes at the end of Q3.

PotashCorp, which bills itself as having the world’s largest production capacity for agricultural-grade potash, also cited seasonal maintenance turnarounds at other potash producers’ operations that had further slowed overall production.

“Improvements”

According to USW, the workers’ new agreement is “customized” to each of the three mines and raises wages by a total minimum of 18 per cent, meaning seven per cent in the first year and 5.5 per cent in each of the next two years. Trades and specially-skilled operators will receive higher rates, the union said.

Among “many other improvements” in the new deal, the employees’ pension plan was also improved “by a significant amount” and time lost due to layoff will be included in pension calculations, the union said.

Rather than a bonus, the new deal also includes what the union calls a “market supplement” in the form of a $5,000 lump sum upon the workers’ return. They’ll also get a total of $2,500, or $625 per quarter, over the following two years, the union said.

Shift premiums will automatically rise to $1.35 an hour and then to
$1.50 on May 1, 2009, the union said. Vacation bonuses have been increased by $50 a week and the return-to-work bonus following a layoff will increase to $800 for the first two weeks and $400 for each subsequent week of layoff.

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