SNC-Lavalin: Canada Nuclear Industry At Risk, Says Union After Strike Vote

CP  |  By Posted: 05/04/2012 5:41 pm Updated: 05/07/2012 1:31 pm

Nuclear

MONTREAL - SNC-Lavalin is threatening the future of Canada's nuclear industry by pushing for employee concessions months after its bought Candu from the federal government, says the union threatening to launch a strike on Monday.

"Their quest to maximize short-term profits at the expense of employees is placing a major Ontario-based industry in jeopardy," said Peter White, president of the Society of Professional Engineers and Associates.

The union representing nearly 900 scientists, engineers, technologists and technicians said more than 94 per cent of its members sanctioned the strike action on Thursday.

White said the vote was "a stinging indictment of SNC-Lavalin's cavalier management style and brinkmanship bargaining."

He said SNC-Lavalin is seeking to extract a series of unacceptable concessions.

A union spokeswoman said Candu is looking to gut most parts of the collective agreement. Proposed changes include a shift to a defined contribution pension plan, wage increases below the industry average and reduced travel compensation when overseeing reactor work.

"This is a watershed moment for the Candu nuclear industry," he said, noting that workers are poised to join the hundreds of their experienced former colleagues who have already fled the company.

But Candu Energy spokeswoman Katherine Ward said the goal is to negotiate an agreement without a work stoppage.

"Candu Energy continues to bargain in good faith with our unions to reach fair, reasonable and competitive collective agreements," she said in an email.

"However, contingency plans are in place to ensure we can continue to carry on business in the event of a strike, to meet the needs of, and contractual obligations to our customers."

White said that a serious shortage of expertise in key areas could become critical to ongoing projects.

SNC-Lavalin (TSX:SNC) expects its Candu Energy revenues will double over five years, excluding opportunities in Ontario to build new reactors.

The union said those revenues are at risk because of an exodus of experienced staff from the company, which was privatized last October.

It said Candu Energy filed for conciliation in January after the first meeting, starting the clock ticking towards a legal strike or lockout on Sunday at midnight.

"We have tried to work with SNC-Lavalin to resolve outstanding issues but they have been unwilling and unco-operative," added vice-president Michael Ivanco.

The Canadian Auto Workers Union and the Communications Energy & Paperworkers' Union have each pledged $1 million to a strike fund.

Ontario selected Candu as its preferred builder of a new reactor, but the contract was put on hold after the commercial division of Atomic Energy of Canada Ltd. was put up for sale. The company is also pursuing construction opportunities in Romania and elsewhere.

Ontario recently awarded a contract worth more than $600 million to a joint venture between SNC-Lavalin Nuclear Inc. and Aecon Construction Group Inc. (TSX:ARE) to refurbish its Darlington nuclear station near Toronto.

Candu reactors supply about half of Ontario's electricity and 16 per cent of Canada's overall electricity requirements. They also supply more than 22,000 megawatts of power at sites around the world.

Meanwhile, the Canadian Nuclear Safety Commission (CNSC) has concluded that Candu's enhanced EC6 reactor complies with its regulatory requirements.

"With this achievement, our Generation III EC6 has completed the key step for licensing consideration of a nuclear power plant in Canada," stated Candu chief nuclear engineer Frank Yee.

SNC has been under pressure after three senior executives left the company for their involvement in approving $56 million of payments to unidentified agents in North Africa.

The company has 24,000 employees in 100 countries, with offices in 40 countries. It is one of the biggest engineering and construction companies in the world and a major player in the ownership of infrastructure and in operations and maintenance services.

On the Toronto Stock Exchange, SNC's shares closed down 58 cents, or 1.5 per cent to $36.73 in Friday trading.

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Filed by Christian Cotroneo  |