Forest worker union loses bid for severance

The local forest workers' union has lost its bid to get severance pay for roughly 40 employees who ran the planer at Western Forest Products's downtown Nanaimo sawmill.

Brian Butler, first vice-president of the United Steelworkers local 1-1937, said the planer operation at the downtown sawmill shut down in December 2008 and never reopened, even after the sawmill reopened in 2010.

The union argued the workers were entitled to severance pay, totalling roughly $1 million, because the union's new contract stipulates severance must be paid after a "major operating component" of a mill has been shut down for two years. While the sawmill resumed operation before the 24-month time frame expired, the planer mill remained down.

Butler said an arbitrator ruled in favour of the company, which argued the planer shutdown happened under the previous collective agreement, when severance pay was only due if the "principal processing and production part of a plant" was shut down for more than two years.

"It's a tough blow," he said. "We're not happy with Western Forest Products for treating workers in this fashion."

While some of the laid-off workers managed to get hired on at other divisions, many are still struggling with the income loss, said Butler.

A lawyer advised the union that an appeal would be unsuccessful, he added.

Makenzie Leine, a Western Forest Products spokeswoman, said that any decision the company makes respects the collective agreement and the arbitrator agreed the company followed the appropriate process.

Another arbitration hearing this summer will deal with whether the company restarted the Duke Point and downtown Nanaimo sawmills to avoid paying severance costs or for market reasons.

The downtown sawmill shut down in December 2008 and reopened on one shift in November 2010. Duke Point shut down October 2009 and reopened on one part-time shift last September.

Butler said each mill had about 160 workers when the shutdowns occurred and now there are about 30 at Nanaimo and 25-30 at Duke Point, where the sawmill runs for two weeks, then the planer runs for two weeks.

"It's not even full production," he said. "Both were down just three weeks shy of two years."

Butler said between the two mills, severance payouts would cost Western between $9 million and $12 million.

Leine said the company would not comment on matters under legal review except to say that operational decisions are based on markets.

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