Tensions heighten at Rio over closure of 2 mines

Indications that Rio Algom (TSE) may close its Quirke and Panel uranium mines earlier than expected has heightened tensions between the company and employees at its Elliot Lake, Ont., division. While Rio Algom predicted in January that the mines would remain open until next spring, it recently issued termination notices to all 1,600 Elliot Lake employees, including office and technical staff.

Rio Algom, required by laws to give 16 weeks’ notice in advance of layoffs, could begin laying off workers on Aug. 21 without agreeing to extend an hourly wage contract which expires Sept. 1.

A company spokesman said the layoff notices were necessary because Rio Algom hasn’t yet established a pricing format with two key customers including South Carolina-based Duke Power Corp.

But representatives of Rio Algom’s hourly wage employees say the layoff notices are only adding to the concerns of staff who, they say, are unhappy with a severance package negotiated under the current wage contract.

“They have really put a lot of stress on these people,” said Vice- President Dan Hutchinson, local 5417 of the United Steelworkers of America. He is preparing to resume negotiations with Rio Algom this week.

The concerns originated in January when Rio Algom said it would close the relatively high-cost Quirke and Panel operations after failing to renew supply contracts that expire April, 1991. As Rio’s other Elliot Lake mine — the Stanleigh — supplies uranium to Ontario Hydro under a contract that runs until the year 2000, it will remain open.

However, Rio Algom spokesman John Sparks said the company is attempting to negotiate an extension to union contracts to allow it to meet the needs of customers if and when a new pricing contract is established.

While Sparks said he is optimistic that the pricing and wage issues can be sorted out, he admitted that clients don’t want to pay more than they have to under contracts signed when uranium prices were much higher.

Adding to the problems is the fact that current wage contracts cover 500 employees at Rio’s Stanleigh operation. According to Hutchinson, production at Stanleigh could be effected if a satisfactory settlement isn’t reached by Sept 1.

A key issue in the negotiations will be the severance package which, in the event of a layoff, entitles unionized employees to two days’ salary for every year worked. “Our membership feels the package is inadequate,” said Hutchinson.