The tents and picket lines are mostly gone. Drivers no longer honk in support of workers as they drive past American Crystal’s five plants in Minnesota and North Dakota. It’s hard to tell, from the outside, that the American Crystal lockout of around 1,300 union workers has lasted a year. Way beyond the month or two union leaders initially predicted.
Inside, company officials are busy training 900 or so long-term replacement workers in preparation for the 2012 campaign, which is set to begin in two weeks.
To an average citizen in the Red River Valley who does not have a direct stake in the sugar processor, it seems as if American Crystal has succeeded in breaking the union. Company officials maintain that was never their intent, and that they continue to negotiate in good faith.
But a year after company officials opted to lock out employees rather than risk a strike in the midst of campaign; it is obvious that American Crystal has the upper hand. Although union leaders insist a settlement can still be reached, that seems unlikely. It mirrors a trend across many businesses.
In the old days, unionised workers used strikes to pressure employers into making concessions on wages or working conditions. But as the number of unionised workers has declined and union clout has waned, employers are more likely to use a lockout to wring concessions from unions. According to a firm that tracks lockouts for lawyers and labour relations experts, at least 17 employers imposed lockouts in 2011.
Lockouts are intended to put unions at a disadvantage. It seems to be working for American Crystal. The latest union vote, held June 23, on the disputed contract showed 63% of voters opposed the contract. The union’s first vote, held before the lockout, rejected the contract by a 96% no vote.
Even though many of the locked out workers have retired or found new jobs, American Crystal sent a letter to all employees a week ago alerting them as to which positions were still available. Union workers can apply for a temporary position without resigning their union position. But if offered a temporary position must resign from their union position before accepting the temporary position. When the contract is finally resolved, workers could apply for their previous position but are not guaranteed a job.
In mid-July, the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union (BCTGM) requested that American Crystal meet to negotiate a return-to-work agreement. A statement posted by American Crystal on its labour negotiations page made it clear that wasn’t an option.
“The Union’s request seems to put the cart before the horse. Normally, the Union would first accept the Company’s final offer and then discuss the terms of bringing people back to work. We have informed the Union that the Company would be willing to meet to discuss this return to work issue only, but with the clear understanding that the lockout would not end until the Company’s final offer has been ratified. We also made it clear that the Company would not be changing the terms of that final offer.”
That offer included a 17% wage increase over five years. It is now closer to 14% because the contract had a deadline. Increased pension, leave and vacation benefits were also included. But union leaders called the effort to make workers pay more for health insurance unfair.
The biggest hurdle to a settlement continues to be contract language that union leaders say threatens job security for union workers. American Crystal wants the right to promote workers based on merit, not union security. The company also wants more flexibility to use temporary contract workers.
So what happens next? Some have suggested that American Crystals give the workers part ownership of the company. That would give workers some of the control they say they want but would also require them to share in the risk of being part of a farming business. While that idea has merit, American Crystal seems unlikely to make that offer given the statement above.
Labour relations experts say the biggest challenge in a lockout is weathering the initial cost of replacing the workforce and resulting declines in production. American Crystal Vice President Brian Ingulstrud says with those costs behind it, the company is now looking toward the future and making sure temporary employees are trained to run the factories as efficiently as possible.
If American Crystal has truly absorbed that initial increased cost associated with the lockout, the dispute is likely to follow a fairly predictable path, says a labour relations expert. The longer the dispute drags on, the less likely reaching a settlement becomes and union leaders will have a harder time rallying workers around the cause. Eventually, the union will just give up its representation rights.
Other sugar cooperatives are watching the dispute closely but so far seem unwilling to follow American Crystal’s example. Workers at Sidney Sugars, Minn-Dak Farmers Cooperative and Southern Minnesota Beet Sugar Cooperative have all signed contracts within the last year or so. SMBSC just reached an agreement with its union workers last week.
The lead union negotiator in that deal is Steve Bertelli, BCTGM vice president. The agreement was reached before the contact’s expiration date and reportedly includes mutual gains for both management and labour. The deal lends credence to the locked out workers contention that American Crystal’s primary goal is to break the union.
American Crystal’s locked out workers issued a statement applauding the agreement.
“That’s the way negotiations are supposed to work. In our own negotiations with Crystal Sugar, our negotiators have tried to address management concerns and meet them even more than halfway. But all our efforts to focus on interests, not positions and to develop options for mutual gain have been rebuffed with repeated demands that we accept a total package of drastic concessions, without qualification or amendment.”
With the year behind them and the union’s position weakening, it now may only be a matter of time until a resolution is finally reached.