Federal Government Must Release Details of Xstrata Agreement, CAW Insists

December 9, 2009, 2:00 PM EST


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The CAW is demanding that the federal government release the details of the agreement it made with Xstrata when it took over Falconbridge in 2006, to see if that deal is violated by Xstrata's plans to close its copper and zinc operations at Kidd Creek, near Timmins, Ontario.

CAW Local 599 members and the community of Timmins, Ontario were left reeling December 7 by Xstrata's announcement, which (if it goes ahead) would throw 500 CAW Local 599 members out of work. Another 170 Xstrata employees would also lose their jobs.

CAW President Ken Lewenza said that Xstrata made commitments to ensure a "net benefit" to Canadians under the 2006 takeover deal. "This global company took control over a crucial part of Canada's natural resource base, and in return it must be required to develop that resource in a way that truly benefits Canadians," he said in a December 9 letter to Industry Minister Tony Clement.

"Closing important value-added facilities, and throwing hundreds of hard-working families out of work, is hardly the way to do this," Lewenza added.

"Canadians deserve to know exactly what was in that 2006 agreement," said Lewenza.  The CAW will press for government action to reverse the closure decision, if indeed, as is expected, the 2006 deal required Xstrata to continue operating value-added facilities.

"This closure would be a devastating blow to our members and their families, particularly at this time of year," said Local 599 unit chairperson Ben Lefebvre. "When the dust settles, hundreds of other jobs will be affected in Timmins and the surrounding communities," Lefebvre said.

CAW Local 599 President Dennis Couvrette said the community would be hard hit. "This closure would represent a loss of more than $50 million per year just in direct payroll to the community, to say nothing of the hundreds of local spin-off jobs that will be lost".

 

 

Jerry Dias, assistant to the CAW President with responsibility for the union's mining sector, said the announcement is another example of why the federal government must set strict conditions when foreign based multi-nationals takeover Canadian companies.

"There must be a real net economic benefit to Canada and to the workers," Dias said.

"Xstrata made billions off of our resources during the boom. It owes something back to Canada today," added Lewenza.

The union requested the release of the details of the 2006 agreement permitting the takeover of Falconbridge in a letter to Industry Minister Tony Clement.

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