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TORONTO (Reuters) - The union representing about 500 workers at three Potash Corp of Saskatchewan mines said on Friday its members will start limited job action to press the company on contract talks.
The United Steelworkers said its members will not work any overtime and will soon start rotating strikes, though they will not shut down production.
Underground and mill workers at the company's Cory, Allan and Patience Lake mines in the Canadian province of Saskatchewan have been without a labor contract since the end of April.
The union is now in a legal position to strike and the company is in a legal position to lock out its employees.
"It's tenuous and, traditionally, a very dangerous time for both parties right now," said Stephen Hunt, Western Canada director for the union.
The company said it has already put its best offer on the table, adding that the offer would make the miners the best-paid in the potash mining industry.
The union rejected the offer, saying its workers' wages will still be lower than those of most workers in the mining industry as a whole. It also said the offer does not adequately address key issues such as contracting out, pensions, vacations, and bonuses.
"The payroll of the top five officers of the company surpasses the entire payroll of our membership," Hunt said.
Potash, a crop nutrient, is a hot commodity because of tight global supplies and strong demand from grain farmers trying to boost yields amid world food shortages.
Potash Corp, the world's biggest fertilizer company, boosted its 2008 production forecast on Thursday after it said it more than tripled its second-quarter earnings to more than $900 million as record grain markets spurred demand for fertilizer.
The company said it would keep the lines of communication open with the union, but that no formal meetings were planned.
"Our current plans are to continue to operate business as usual at all three mines," said Bill Johnson, a spokesman for Potash Corp.
The union said it has asked the company to return to the table and that the ban on overtime and the rotating strikes will mean anything but "business as usual."
"What it'll mean is that some things at the mine sites won't get done as fast as they normally do, and some action will happen," said Roger Falconer, a spokesman for the union.
"Hopefully by doing this we'll avert a full-scale strike and people will come to their senses and talk."
The three mines accounted for 2.769 million metric tons or 30 percent of the company's production last year.
The company's stock closed up 4.6 percent, or C$9.04, at C$205.89 on the Toronto Stock Exchange on Friday.
Editing by Peter Galloway