IAM Local 1848 and Hudbay have a potential last-ditch bargaining meeting slated for next week, a move that comes as both sides play their cards in a high-stakes negotiation.
IAM said its negotiators and Hudbay are scheduled to attend a concilliation meeting this Monday evening, April 27, the third time the two sides have met with a concilliator during these negotiations.
“Our one and only objective is to get our outstanding issues addressed and bargain a deal that we can recommend to our membership,” IAM said in a statement on its website.
Blair Sapergia, IAM vice-president, could not predict what will happen if the union leaves concilliation dissatisfied with Hudbay’s offer.
“I guess we’ll be making decisions after that. I can’t say,” he said. “Hopefully we resolve it.”
Dues change
Earlier, Hudbay served notice it would no longer deduct membership dues for IAM, forcing the union to do so on its own.
“Clearly a shot at the union, if you will,” said Sapergia, adding that he does not believe the union will have problems collecting its own dues.
IAM used much stronger language on its website, calling Hudbay a “bully” that is “trying to cripple us financially and beat us into submission.”
Hudbay’s move does not take away any membership revenue from IAM, nor is it prohibited given that the terms of the previous contract between the union and the company expired earlier this week.
“Although Hudbay is not obligated to do so, we will continue to honour the terms and conditions of employment of IAM employees,” Rob Winton, Hudbay’s vice-president, Manitoba Business Unit, wrote in an email. “This includes items such as wage rates, overtime rates, extended shift agreements, etc. Hudbay will no longer collect union dues from employees.”
IAM responded Wednesday morning by informing Hudbay that its members would immediately revert back to eight-hour shifts rather than the standard 12-hour shifts.
“They’re either going to start paying overtime to our members [after eight hours] or they’re going to have to adjust their shift schedules so that they work [eight-hour shifts],” said Sapergia.
On its website, IAM reminded members that overtime is mandatory only in emergency situations and that they do not have to work extra hours if they choose not to.
Meanwhile, in a phone interview from Toronto, Hudbay president and CEO David Garofalo threw his full support behind Rob Winton, vice-president, Manitoba Business Unit for the company.
“Rob’s done an exceptional job of keeping us up to date on developments at the bargaining table and he has my full confidence,” said Garofalo when asked for his thoughts on IAM’s rejection of Hudbay’s final offer earlier this week. “That’s really all I’d have to say about it.”
Asked whether Hudbay would offer IAM a different contract, Garofalo reiterated that he had nothing more to say on the matter.
Winton has defended Hudbay’s offer to IAM, which he said provided wage increases of 10.9 per cent to certified IAM members and pension increases of 10 per cent over three years.
An outline of the offer provided by Winton showed the pension increase contained in the offer was 22 per cent higher than the increase negotiated in the last contract.
The latest offer also contained increases to the bridge benefit, vision coverage, paramedical coverage and short- and long-term disability coverage. The offer further removed wage study from the collective agreement, with Hudbay agreeing to make retroactive payments to 25 employees.
‘Final offer’
Winton reiterated Wednesday that “the offer was a final offer.” He said Hudbay reached out to the concilliator who will be in Flin Flon next week.
“Hudbay continues to work towards agreement with our seven unions,” Winton added. “The IAM chose to hold strike votes in March and not ratify Hudbay’s offer this week, so it is the IAM that will choose to strike.”
Also on Wednesday, IAM posted a statement on its website stating that Hudbay’s stock dropped 3.43 per cent the previous day because of the failed negotiations.
“As we can see now, investors are not willing to buy stock in a company that is unwilling to treat [its] employees fairly and table an offer to reflect that,” read the statement.
A Toronto-based financial analyst told The Reminder that although labour strife can impact investment, copper miners collectively saw their share prices fall on Tuesday.
The analyst, speaking on the condition his name not be published, said Hudbay investors are now focusing on the company’s Constancia mine in Peru.
If Constancia encounters hiccups, and those hiccups are compounded by labour unrest in Manitoba, there could “certainly” be an impact on share price, the analyst added.
In the midst of all of this are renewed suggestions that Hudbay may be ripe for a takeover.
Takeover rumours have dogged Hudbay for years, but this time they are generated by rumblings that mining giant Teck Resources Ltd. could be in search of acquisitions.
Last month Shane Nagle, a metals and mining analyst for National Bank Financial, outlined why Teck, Canada’s largest diversified resources company, should scoop up Hudbay.
“The combined company would provide near-term growth, long-life diversified operations, and carry less financial risk,” wrote Nagle in a note to clients that was quoted by BNN. “In our opinion, the possible combination of these two companies is intriguing and would result in an improved outlook for Teck Resources.”
In an interview, Nagle told BNN that copper and zinc – Hudbay’s core metals – “have more favourable fundamentals” than the metallurgical coal that
accounts for much of Teck’s business.
Contractual differences
As far as negotiations between the union and Hudbay go, IAM Local 1848 vice-president Blair Sapergia says the two sides remain far apart, particularly on non-monetary issues.
Sapergia cited Hudbay’s use of contractors, the grievance procedure and proposed language changes to the health plan that would “essentially remove the health plan from our collective agreement.”
Hudbay has denied asking for concessions to benefits. While Sapergia said that choice of words is accurate, it does not tell the whole story.
Sapergia said Hudbay’s offer would have the health plan prevail in the event of a discrepancy between the health plan and the collective agreement.
Sapergia said the union would be unable to grieve the matter if Hudbay changes the health plan or decides to go with a carrier that refuses to provide benefits to retirees.
“The fact that benefits carry over into retirement here is a bit of an anomaly in the workplace,” Sapergia said.
Given a chance to respond, Rob Winton, vice-president, Manitoba Business Unit for Hudbay, gave a much different interpretation.
Winton said the offer presented to IAM removed reference to the Health Plan Agreement, which he said IAM has not signed since 2006, and maintained the language as it was in the now-expired collective bargaining agreement (CBA).
“The reference was changed to Group Benefit Plans, which have been enhanced with nothing removed,” Winton said. “The language in the CBA can be grieved, as only the document being referenced was changed.
“The comprehensive benefits that our employees, spouses, children, dependents and retirees are eligible for today [are] the benefits they will be eligible for tomorrow. This is a core belief of Hudbay, and it is disheartening the IAM is attempting to misrepresent what was in our offer and the discussions that occurred at the negotiating table.”
