March 9, 2010 / 8:09 PM / 8 years ago

Union sees Canfor contract as pattern for industry

* Labor deal ratification vote under way

* Union says agreement should aid industry recovery

VANCOUVER, March 9 (Reuters) - Results are expected in the next few days on a vote by workers at Canada’s No. 2 lumber producer Canfor Corp (CFP.TO) on a contract the union hopes will set a pattern for British Columbia’s other sawmills.

The tentative four-year deal with Canfor has no wage hike in first two years, and 2 percent in the third and fourth years, and is structured to help restart idled sawmills as the lumber market recovers, Bob Matters, chairman of the United Steelworkers’s Wood Council, said on Tuesday.

“We do expect it to be the pattern agreement for talks with the other employers,” Matters said.

The more than 1,600 workers at 15 Canfor mills in British Columbia’s northern and southern interior regions have been voting on the deal over the past week.

Matters said he expects the tentative contract will be approved, although he added: “I don’t want to jinx it,” by making the prediction.

The union agreed to defer some holiday and vacation pay as an incentive for Canfor to invest in equipment to upgrade its sawmills, while workers laid off in partial mill shutdowns will get more severance protection.

Workers laid off from mills in isolated rural communities were also given stronger seniority rights as an incentive to return as the plants resume production to meet growing lumber demand, Matters said.

The union said in a note to its members that it agreed to concessions such as deferred benefit payments as an alternative to direct wage rollbacks, and that there was the possibility of profit-sharing in the future.

The contract, negotiated late last month, is retroactive to July 1, 2009. Contracts with other producers, most of whom bargain jointly through industry associations, also expired last year.

British Columbia produces about half of Canada’s softwood lumber exports to the United States. Workers remained on the job after industry labor deals expired last year, although many mills were idled because of the recession.

Companies with mills needing labor deals in British Columbia include West Fraser Timber Co. Ltd. (WFT.TO), Tolko, Tembec TMB.TO and AbitibiBowater ABWTQ.PK.

$1=$1.03 Canadian Reporting Allan Dowd, editing by Peter Galloway

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