OTTAWA, May 30 — Inco, the Canadian mining company entangled in a series of conflicting takeover bids, has agreed with a labor union to preserve all jobs at its main operations even if the company is acquired.þþThe promise is part of a tentative agreement the company and the United Steelworkers reached on Monday. The union revealed some terms of the contract, which is rich by current Canadian standards, on Tuesday.þþIf workers at Inco's operations in Sudbury and Port Colborne, Ontario, accept the agreement, wages will rise by 2.50 Canadian dollars an hour over the contract period, profit sharing worth about 5,000 Canadian dollars a year will continue and pensions and other benefits will be improved.þþInco has mde a friendly offer to acquire Falconbridge, another nickel miner with extensive operations in Sudbury. The Swiss company Xstrata has made a hostile counteroffer for Falconbridge, and Inco itself is the target of an unsolicited bid worth 17.8 billion Canadian dollars from Teck Cominco, a diversified mining company based in Vancouver, British Columbia.þþMichael S. Lynk, a professor specializing in labor law at the University of Western Ontario in London, said that Teck Cominco or any other purchaser would be bound by the no-layoff clause in the contract, assuming that it is approved by workers at a vote on Wednesday.þþÿThe purchaser steps into the shoes of the old company if Inco is bought,ÿ he said. ÿThere have been cases where companies sign a rich collective agreement as a mild kind of poison pill, and I suspect that may be the case here.ÿþþAn Inco spokesman, Cory McPhee, said the no-layoff clause, which also applies if Inco successfully acquires Falconbridge or any other miner, was proposed by the union.þþÿThis reflects the job-security concerns brought to the table by the union because there is a lot of merger and acquisition activity,ÿ Mr. McPhee said from Sudbury. ÿIt was not conceived as a poison pill.ÿþþKerry Smith, a Toronto-based analyst with Haywood Securities, said the ban on layoffs was ÿmildly negative,ÿ but he said he did not think it would make Inco significantly less attractive to would-be buyers.þþÿI'm surprised that they settled up,ÿ Mr. Smith said. ÿI thought they would be on strike. This at least keeps them working.ÿþþBefore last weekend, union members at Inco had voted 98 percent in favor of a walkout. Talks between the union and the company collapsed early Sunday but were revived by a government-appointed mediator on Monday.þþThe union also represents Falconbridge workers and has endorsed Inco's bid for that company over Xstrata's offer.þþA spokesman for Teck Cominco declined to comment.þþ
Source: NY Times
