BUSINESS

N.L. premier expresses concern after Kruger mill withdraws from negotiations

06/16/2012 10:50 EDT | Updated 08/16/2012 05:12 EDT
CORNER BROOK, N.L. - Newfoundland and Labrador's premier has expressed renewed concern after negotiations between a newsprint mill and its employees broke off late Friday.

In a statement issued Saturday, Premier Kathy Dunderdale urged the Corner Brook Pulp and Paper mill and its workers to continue to work towards an agreement.

Dunderdale said she remains "extremely concerned" about the future of the mill, but said the government will continue its support once labour and pension issues are resolved and a long-term plan for the operation is in place.

"We all have the same goal here – that Corner Brook Pulp and Paper remain a key employer and driver of economic growth for the western region and our province," said Dunderdale in a statement on Saturday.

Kruger Inc., the Montreal-based company that owns the mill, said in a news release that it left the bargaining table without reaching an agreement with the unions before the deadline of Friday at midnight.

Kruger said the Communications, Energy and Paperworkers union agreed to hold a vote this week on the company's final proposal.

As a result, Kruger said it has extended the deadline to reach a collective agreement to June 22, saying "the future of the Corner Brook Mill is now in the hands of its employees."

The restructuring of the company's pension policy has been a stumbling block in the negotiations.

Kruger wants more time to pay back its pension deficit because the mill is on the verge of bankruptcy.

Last month, unionized workers at the mill rejected the company's proposal to repay a pension deficit over 10 years instead of the normal period of five years.

Kruger said that all labour issues must be settled by the end of next week because it needs to complete its assessment of the mill's viability.

Corner Brook Pulp and Paper is the last paper mill to continue operating in Newfoundland after a series of shutdowns in other communities in recent years.

(VOCM, The Canadian Press)