“Rewriting the Industry Standards”

According to Vale’s own data, since its most recent collective agreement in 2016, its rate of workplace injury has more than doubled. Despite this, the company is demanding cuts to health benefits. This is part of Vale’s ongoing attempt to lower, as much as possible, any and all worker-related costs.

After a wave of layoffs last fall, Vale won similar concessions from its workforce in Thompson, Manitoba. Vale then retroactively defended the results of these renegotiations, imposed on its workers, as examples of good practice. “They say it’s in line with industry standards,” says Anderson, a Vale Sudbury worker currently on strike: “In fact, they are rewriting the industry standards to offer less.”

Anderson points out that Inco — Vale’s predecessor — paid five times the minimum wage in the 1990s. Today, the company’s pay is only two and a half times what is legally required of them. At Vale, decreasing pay has gone hand in hand with increasingly dangerous conditions.

In recent years, Anderson has seen coworkers suffer life-threatening injuries or have to work despite being seriously ill. Equipment used to torque bolts damaged one worker’s back. Another coworker, based at the nearby smelter, logged long overtime hours, but “looked sickly” during a past strike — “he died right after retirement.”

A third colleague of Anderson’s still had to work at the mine despite requiring a colostomy bag. The fact that management forces workers to endure these conditions, he notes, “speaks volumes about the need for a solid benefit plan later in life.”

As Ethan, another Vale mine worker in Thompson, Manitoba observed: “You work for thirty years. You destroy your body, then they take your health benefits.” In the first quarter of 2021, Vale delivered $3.9 billion to its shareholders.

The Last Crisis

When the 2008 economic crash ravaged Ontario’s manufacturing sector, Vale demanded deeply regressive “concessions” from its employees. Workers, the company claimed, needed to come to terms with “new international realities.”

The Globe and Mail reported that Vale, the new owners of Inco, spent significant resources meeting with government officials “to win support for cutting costs and jobs.” Federal minister of industry Tony Clement championed Vale’s cause, claiming that without the company Sudbury, would become a “valley of death.” The Ontario Liberal government meanwhile refused to support legislation to curb strike breaking. Instead, the provincial Liberals opted to call for “consensus” between the company and the union.

In a surprisingly candid interview with the Globe, one former executive admitted that consensus wasn’t actually part of Vale’s agenda:

They just want to break the union. They want to completely hit the reset button on the entire labor situation and the agreements that have been put in place in the past.

To aid this, Vale launched a sweeping wave of reactionary reforms. The company imposed layoffs, demanded wage freezes, and made changes to grievance procedures to facilitate future layoffs and cut bonus pay. In addition, Vale demanded pension reform, proposing a shift from the more secure Defined Benefit (DB) pension plan to a Defined Contribution (DC) scheme.

The union rejected this offer. Vale then hired the strikebreaking private security firm AFI International to force workers to accept the agreement. AFI, now AFIMAC, is proud of its close ties to the police and military personnel, many of whom have gone on to be directly employed by the international security company. Over the course of the strike, AFIMAC broke picket lines and a community blockade and worked to help Vale secure injunctions against its workers.

With the help of its strikebreakers and around twelve hundred scabs who crossed the picket, Vale was able to remain operational throughout the strike. The company also fired nine workers and sued them for thousands in damages. Despite nearly a year of opposition from the union, the company had the resources to wait them out.

The company’s war of attrition led to a 20 percent contraction in Vale’s unionized workforce. After this wave of creative destruction, the corporation was able to reshape labor relations as it saw fit. Vale seized new transfer and grievance rights, increased its use of nonunion contract labor, and reduced the pensions of new hires.

Despite cutting the wages, pensions, and health care benefits of its workers, the company has paid a total of $13.55 billion in dividends since 2015. As of late last year, Vale was sitting on a cash stockpile of $12.9 billion.

The Vale strike came in the context of a series of layoffs and plant closures in Ontario. Workers took part in a wave of militant strikes and occupations to protect their jobs and improve their standards of living. These included the March 2007 walkout at Collins & Aikman; the occupations of Hamilton Specialty Bar and the Mississauga’s masonite manufacturing plant in May 2017; and the 2009 blockade of Windsor’s Aradco-Aramco plant.

The Canadian Auto Workers Union, which organized thirty-two occupations between 1980 and 2009, led several of these efforts. However, many of these occupations were isolated actions. But management at other firms, such as General Motors in Oshawa, joined Vale’s lead and implemented the same regressive workplace reforms.

Companies like Vale take advantage of so-called “pattern bargaining” by which employers      standardize the terms in collective agreements across large workplaces. Struggles over working conditions at a large workplace like Vale’s Sudbury mine are therefore strategically important because the conditions imposed on workers there will go on to shape industry standards.

A History of Struggle

To go on the attack, labor needs to emulate the strategic planning of the business class. This is, of course, easier said than done. The Left should, however, find inspiration in the long history of militant action by Sudbury’s nickel miners.

During their 1958 strike, the International Union of Mine, Mill and Smelter Workers (who merged with the USW in the 1960s) faced Vale’s predecessor, Inco. The mining conglomerate had built up a year-long nickel stockpile to weather the storm in case of union opposition to wage and hour cuts.

When miners did go on strike, they understood that their employer’s preparation meant that they had to act militantly. Mine workers launched a two-month strike in which workers and supporters surrounded Inco’s Toronto headquarters and marched around Queen’s Park. Union supporters also picketed foreign nickel shipments at the Montreal port. In the end, they won a sizable wage increase during a recession.

In 1978–79, Inco attempted to use an economic crisis to weaken the union, foreshadowing current events. At the time, Canadian Business speculated that the strong wage settlements Sudbury’s mineworkers had won were a key target for employers and the federal Liberals. Large companies, and their political allies in the Liberal party, worked in tandem to impose wage “restraint” on Canada’s labor movement by breaking strikes, jailing union leaders, and rolling back wage gains.

Inco’s attempted to resolve the crisis by proposing a new contract for workers that took into consideration the economic constrains imposed on the firm. The offer, as Mason Godden writes, “infringed on several areas of the existing grievance procedures and workers’ seniority rights.” It was soundly rejected, and Inco’s workers went on strike in September 1978.

The USW and the adjacent Wives Supporting the Strike mobilized community members and surrounding unions to fund collections, toy drives, and community clothing provision to help wait the company out. Fishers in British Columbia donated fish, and the St Catharines and District Labour Council sent thousands of toys for striking workers’ children.

Workers at Falconbridge and Laurentian Universities also doubled their union dues to support the strike. Unions and social movements organized solidarity rallies across Ontario. Support came in from unions in the United States, Britain, and elsewhere.

The USW explicitly linked the struggle of its members to those against similar cuts that governments and employers were trying to impose across Canada. In November 1978 alone, the union was able to send around a hundred of its members to support striking postal workers.

The growing strength and militancy of the union movement became a concern for the federal government as well as employers. A report commissioned by Emergency Preparedness Canada warned:

The power of the union grew during the strike. The effects appear to have spread far beyond Sudbury.

By the spring of 1979, the company’s reserves were running dry.

The company’s net growth had fallen from $34.9 million in the pre-strike first quarter of 1978 to just $500,000 in Q1 of 1979. Inco’s attempt to defeat the strike by amassing enough reserves to wait out the union failed because of the continued increase in militancy on the part of organized labor. In the end, the USW won a wage increase and full pensions for workers after thirty years of service, regardless of age.

The history of USW teaches us that workers can win against companies wishing to use economic crises to justify layoffs and benefit cuts. The Left must work to unite the struggles with all employers using the pandemic as a justification for increasing the rate of exploitation. Bosses and not workers should bear the cost of any economic crisis.