Kennecott agrees on contract

MAGNA — Kennecott Utah Copper and four unions have agreed on a labor contract collectively bargained since Aug. 27, the company and union officials said Wednesday.

The unions — the United Steelworkers of America, International Union of Operating Engineers, International Association of Machinists and International Brotherhood of Electrical Workers — represent more than 1,200 of Kennecott's approximately 1,800 employees.

Employees represented by the United Steelworkers will receive a pay raise of at least $1.10 per hour, according to a statement Wednesday from the union.

The pay raises will amount to more than $8 million over the next 12 months, and that money will be pumped into the local economy, said Wayne Holland, a representative for the United Steelworkers.

The raise is part of a new, 7.5-year contract that employees ratified Tuesday. Over the term of the whole contract, employees will receive $50 million in raises.

The union is happy with the contract because, during the next 7.5 years, there will be $30 million available in a trust fund for health-care costs of retired employees. Some of the money is already in the trust fund, and Kennecott management has agreed to pay 55 cents per man-hour "to go into the fund to make sure that fund is viable," Holland said. The new union contract results in the most significant pension increases ever achieved for American copper workers, he said.

In announcing the agreement, the company said the agreement allows it "to have more predictability with regard to labor costs and their impact on future operating and capital-investment plans."

"From the beginning, both parties indicated they wanted to bargain in good faith – that is exactly what happened," Andrew Harding, Kennecott's president and chief executive officer, said in a prepared statement. "Not only do we have a contract that allows us to continue operations and supports business-improvement efforts, but also one that provides many wage and benefit improvements typically not seen in this economy."

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