Caterpillar and Rio Tinto lockouts force unions into underdog fight against global capital

By Fred Wilson
rabble.ca
January 5, 2012

In Alma, Quebec, and London, Ontario, workers are standing together on picket lines against the cold and winds of January. They have strong unions and solidarity to raise their spirits -- but these workers are underdogs against massive economic power and the ruthless force of global capital.

How it goes for them will shape economic outcomes for many other Canadians. But not just labour relations hang in the breach of these first labour battles of 2012. The reaction to these conflicts by Canadians will set a tone for the social and political climate well beyond this “Winter of Discontent.”

In both cases these fights are picked by the employer -- lockouts. Perhaps not so coincidentally, they throw down the same challenge to Canadian labour. They are each foreign owned global corporations with a history of confronting and breaking union power, and their lock outs are to force substantial concessions that will result in lower wages and lesser benefits.

Significantly, these two situations are also linked because each foreign owner recently purchased the Canadian operations and required approval from the Harper government that their acquisition was in the Canadian interest.


Needless to say, these 1260 locked out workers can expect no help from their government and are on their own against global finance capital, with only the help and solidarity they receive from other unions and their communities. They are the face of the 99 per cent in Canada this winter.

In Quebec, 800 members of United Steelworkers (Metallo) are locked out by Rio Tinto Alcan, the former Canadian aluminum company since 2007 owned by Anglo-Australian mining giant Rio Tinto. Rio Tinto has assets valued at over $80 billion and recorded over $14 Billion in profits in 2010.

The principal issues at the Alma (Lac St. Jean, Saguenay) aluminum mill are wages, seniority and an employer demand to eliminate contract language restricting the sub contracting of jobs. Contracting so called “non core” jobs is a blunt instrument to reduce labour costs and weaken the local union.

In Ontario, 465 members of the Canadian Autoworkers are locked out by the world’s largest mining and machinery manufacturer, Caterpillar -- CAT. It is hugely profitable and in its worst recent year, 2010, still topped the Dow Jones Industrial index with a 53 per cent increase in its share values. Profits last year soared 44 per cent and sales this year are up 31 per cent.

Regardless, this company is demanding wage cuts of up to 50 per cent, eliminating the defined benefit pension plan and slashing other benefits. CAT is notorious for its treatment of workers. In the 1990s, the company used scabs to break two lengthy and bitter strikes by over 13,000 members of the UAW in the United States. In 2009, the company laid off 11,000 workers on one day.

The fingerprints of the Harper government are all over the London lockout. In 2008 the Conservative government gave the London diesel locomotive maker Electro-Motive millions in tax breaks and subsidies, and PM Harper used the occasion for a political photo-op. Then in 2010, the Conservatives approved the sale of the plant to CAT. CAW President Ken Lewenza has called for a review of the acquisition under the Investment Canada Act. The union believes that CAT purchased London to get technology and market share and has had a plan from the outset to move production to a new, non union plant in the U.S.

CAT is infamous for never blinking in labour disputes and using hard ball tactics to starve out workers. As Toronto Star columnist David Olive put it this week: “Even Wal-Mart Stores Inc. can’t match Caterpillar’s resolve in dictating terms to its workers. The firm has a practiced skill at ‘taking a strike’ for as long as required until workers straggle back to work across their own picket lines.”

Rio Tinto calculates that, like Vale Inco last year, it can also out last workers at just one of its global operations in a dispute that will only marginally affect its revenues. In addition it has announced that it will operate the aluminium mill at one third production. The USW claims that helicopters are already bringing scabs into the mill to backstop the local managers.

But lets not call these fights too early, because in both cases there will be a spirited fight back with a lot of solidarity from the community to the global labour movement.

At Rio Tinto, the USW is likely the most advanced of all trade unions in shaping global unionism and fighting across borders and continents. With the USW's strong global connections to unions representing Rio's aluminum smelter workers in France and the United Kingdom and the company's mine workers in the US and Australia, the global corporation will not be able to simply put Alma on ice until the workers give up.

Another factor in Quebec is that province’s labour laws prohibiting scabs -- laws that USW/Metallo already claim are already being violated. It took only a day for the company to secure injunctions moving picket lines back from its gates, but that is also a sign that it will not be easy to maintain production against a strong picket line and Quebec’s anti-scab law.

There are no laws to stop scabbing in Ontario, but CAT will not be able to send in scabs to run the locomotive plant with the same impunity that allowed them to prevail against their US union. The Ontario Federation of Labour has declared that there will be mass picket lines if scabs are brought to London.

There is also a political factor in these disputes that runs counter to the business narrative that money always wins and that the (labour) market decides. These lock outs present a “which side are you on” public relations problem for the Harper Conservatives when they invite global corporations like Rio Tinto and CAT into Canada. The NDP and the Canadian Labour Congress have already jumped on demands for change to the Investment Act to protect Canadians in foreign takeovers. If Canadians get angry over the manner in which these corporate interlopers treat workers and communities, pressure will grow for acceptable compromises.

That anger can add a dimension to these struggles that Rio Tinto and CAT are not expecting. Usually labour disputes are communicated through the narrow prisms of media conference statements and brief images of hooded workers huddled around oil can fires. But what if this time a lot of Canadians connect in a human and personal way to these workers on winter picket lines. What if Canadians who are uncertain of their own futures, pissed off at the entitlements of elites and corporations, and looking now for a way to continue the spirit of Occupy -- take inspiration from the courage and sacrifice of the CAW and USW picketers and join their fight. This Canadian winter could yet become a long one for global capital, and an early spring for the rest of us.