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No progress at Crystal Sugar

This news story was published on June 10, 2012.
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Mike Hughlett, Star Tribune, Minneapolis –

The bitter lockout of 1,300 American Crystal Sugar Co. workers recently entered its 11th month, and no end is remotely in sight.

(PHOTO: American Crystal Sugar workers at a rally this spring in Mason City, Iowa.)

Management and union representatives met Friday for the first time in about five months — and only the fourth time since the lockout began — but the talks went nowhere.

The union offered “detailed proposals” addressing management concerns about health care, seniority and other issues, said John Riskey, president of Bakery, Confectionery, Tobacco Workers and Grain Millers Local 167G.

He declined to specify the proposals but said Crystal Sugar’s management “made clear they are not willing to compromise on any issue and intend to prolong the lockout until every single one of their terms is met.”

The company, in a news release, said the two sides “remain far apart.” The union’s latest “contract demands continued to ignore many of American Crystal’s proposals and the realities of the workplace today,” the company said. “The union also continued to demand wage and pension increases significantly above those contained in American Crystal Sugar’s final offer.”

Riskey said the union has not asked for wage increases above what Crystal has offered, and only slight pension increases.

The two sides were brought together Friday by a federal labor mediator at the request of the union.

The company locked out workers at five Red River Valley plants after workers resoundingly voted down a contract that would have raised wages 13 percent over five years, but would have increased health care costs and altered some key contract language to workers’ detriment.

Moorhead-based Crystal Sugar, a farmer-owned cooperative, is the nation’s largest beet sugar producer with three plants in Minnesota, one each in Moorhead, Crookston and East Grand Forks. The other two are in North Dakota.

The plants have continued operating with temporary replacement workers. By law, locked-out workers can’t be permanently replaced, but lockouts can drag on indefinitely.

Locked-out workers are losing $1,000 to $2,300 per month, the union says, with North Dakota workers hit hardest, since unlike Minnesota employees, they’re not eligible for unemployment insurance.

The lockout has also nicked the bottom line of the company and its farmer-owners. Federal securities filings say that partly due to the lockout, Crystal Sugar’s production costs were up $137 million during the first half of its fiscal 2012 compared with a year ago.

The company estimates that its payout to beet farmers this fiscal year will be $59 per ton, which compares with around $73 per ton for Minn-Dak, another beet grower co-op in the Red River Valley.

“There’s no question there was a significant impact on our payment by the lockout,” said Brian Ingulsrud, a Crystal Sugar vice president. However, he noted that this year’s payout to Crystal Sugar farmers would still be the second-highest on record.

Crystal Sugar has been working to reduce lockout-related costs by hiring local replacement workers. When the lockout started, the firm brought in replacements recruited by Minnetonka-based Strom Engineering.

It was an expensive proposition since Strom workers needed housing and meal per-diems, which were ultimately paid by Crystal Sugar. Plus, Strom got its cut as a labor contractor. But in November, Crystal Sugar began advertising to hire local replacements.

Currently, about 70 percent of the plants’ workers are local, and 30 percent were supplied by Strom, Ingulsrud said, bringing down the company’s costs. “We feel pretty good about the future.”

About 240 union workers have informed Crystal Sugar they have retired or quit, he said.

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20 Responses to No progress at Crystal Sugar

  1. Observer Reply Report comment

    June 12, 2012 at 8:58 am

    Call them bullies if you wish. But, their basic function is to represent the best interests of their members, plain and simple.

    Walk into your bosses office, and tell him you need a 3% raise. What do you think he will tell you? Chances are, he will tell you to take a hike.

    Your boss can inform you, he is cutting wages by 10% and work weeks will be longer, and you have no other recourse than to find another job.

    Walk into his office, and explain that a process creates a work hazard. Chances are, you will get lip service, and by the time the issue is examinied by OSHA, someone may get injured.

    Your pension plan/401k is changed, the company will no longer match contributions. What power do you have? Other than your feet, nothing.

    You have worked all your life in a job, with the promise that your pension will be there when you retire. Last week, the company went belly up, and you are left empty handed 6 months before you are set to retire. Good luck hiring an attorney, and fighting with the Federal Government on your own.

    You got sick three months ago, and have not fully recovered. Your boss decides to terminate you because you can no longer do your job. Good luck fighting them on your own.

    You become injured on the job, and are terminated for supposed cause. You are stuck with nothing. The only recourse is finding an attorney who is competent in that field, on your dime.

    Those who belong to a Union, have those benefits. They have competent people who know the laws, know the field of labor, who can negotiate fair wages, and have the resources to help you.

    Left on your own devices, you have nothing!

    • ILikeMyBigBelly Reply Report comment

      June 12, 2012 at 9:23 am

      Observer: It is obvious you are a union employee, taking time (on company time nonetheless) to write such an eloquent response. This probably took you 2hrs to write, when you should be working. The time you took to write this, probably means you didn’t complete your work, and therfore, will rob the company of OT to complete your job.

      • Observer Reply Report comment

        June 12, 2012 at 9:32 am

        Yes, I was a Union member. I am not on-duty so writing what I did, took me about 15 minutes of my own time over coffee.

  2. concerned Reply Report comment

    June 12, 2012 at 8:38 am

    It is time to open the U.S. up to the world sugar market.

    American Crystal sugar is all for free enterprise except when it hurts them. They are the bullies.

  3. *Larry* Reply Report comment

    June 12, 2012 at 8:07 am

    American Crystal Sugar should replace those union workers, or should I refer to them as “Union Bullies” ! Unions used to serve a decent purpose in the U.S., but have sadly run amuck and turned into one of the largest bullying groups known to mankind. This is one of the main reasons so many industries have left the U.S. Unions are greedy bullies – plain & simple, and also forcing some cities into bankruptcy because of all their greedy demands.

    • Observer Reply Report comment

      June 12, 2012 at 9:09 am

      “This is one of the main reasons so many industries have left the U.S. Unions are greedy bullies – plain & simple…..”

      This is not correct. American companies move production to areas that have cheaper labour. The reason is, the competition from third world countries undermined our standard of living. In some cases, foreign countries dumped goods into the U.S. Those items were priced lower than the raw materials cost to produce them.

      All that was facilitated by the American Consumer, who wanted something cheaper. And history has so many cases of that, it is impossible to refute.

      Do not blame Organized Labour for that. Blame yourselves. You decided that the products you wanted were foreign. You decided to put your neighbor out of a job. You decided to subsidize a foreign economy, at the loss of your own country. It was you, who decided to allow foreign workers to perform labour in our country, continuing to lower labour rates for other American workers.

      Give credit where it is justly due, the American Consumer!

  4. HOG Rider Reply Report comment

    June 10, 2012 at 10:05 pm

    @Anonymous…I can assure you I am not jealous. Just speaking the facts that I know of. My experience with unions, is that members are protected for mediocre work. Those non-union workers don’t have that protection.

    And I would be glad to ride my HOG!

  5. John Reply Report comment

    June 10, 2012 at 5:48 pm

    I don’t have a pension, I have a 401K that I contributed to.

    Do the rest of you have a pension? This seems to be the black and white thing here. I could be wrong but it seems like that is it.

  6. HOG Rider Reply Report comment

    June 10, 2012 at 4:25 pm

    Glad to see the union demands were recognized for what they were – unrealsitic with today’s economy.

    Thank a union for one of the reasons your Alliant Energy bill is out of control.

    • Ha! Reply Report comment

      June 10, 2012 at 7:42 pm

      Amen, HOG Rider. Ride on brother.

      • HOG Rider Reply Report comment

        June 10, 2012 at 9:09 pm

        Im just saying unions dont mean the quality of the work is any better. Unions provide protection of good, bad or poor work quality. No reason for a union member to perform any better becuase they have job protection.

    • Anonymous Reply Report comment

      June 10, 2012 at 9:25 pm

      look at the 12th st bridge, that was built by Rat labor… look how long it took, and isnt there a problem with it already!? Union = Skilled Labor!! non union (scabs) = no skill + low wages!! Build union!

      • HOG Rider Reply Report comment

        June 10, 2012 at 9:30 pm

        Union=No guarantee of skiled labor. Union often=overpaid labor. I know union workers that have no training whatsovever in any trade, yet are union. Your black and white thinking in believing unions guarantee quality work is quite inaccurate.

      • Anonymous Reply Report comment

        June 10, 2012 at 9:40 pm

        i think you’re just jealous!! get on your HOG and ride on CHUMP

      • LVS Reply Report comment

        June 11, 2012 at 2:45 pm

        I believe Henkle was the general contractor on the 12th street bridge. That is why they don’t want to make them responsible. Yes, they had a sub-contractor who was the low bidder but they are responsible to Henkle and Henkle is responsible to the city.

    • A Dem Reply Report comment

      June 10, 2012 at 11:47 pm

      No one knows what the ‘demands’ are. It just says they are highter then the companies offer. If the union is asking for status qou, and the company is asking for a decrease, then it is higher then the companies offer, but it doesn’t mean its bloated.

      Unions provided you a weekend, a hourly wage, OSHA and work place safety, paid sick leave, overtime, Vacations, Holidays off or extra pay, shift differentials, etc.

      Companies provided you NAFTA and the export of jobs, how does that help anyone? Products costs less? Of course your making less so thats a moot point.

      • SaucySister Reply Report comment

        June 11, 2012 at 7:35 am

        So your saying in today’s present world, if unions did not exist we could go back to child labor.

        In today’s world, with OSHA, Child Labor Laws, EEO, etc…unions are no longer needed.

        Unions just serve for job protection for mediocrity.

  7. Matt Marquardt Reply Report comment

    June 10, 2012 at 4:16 pm


    Union Again Rejects American Crystal’s Final Offer

    Following are meeting notes from the June 8, 2012 meeting:
    The union spokesman outlined a description of their latest contract demands. These contract demands continued to ignore many of American Crystal’s proposals and the realities of the workplace today. The union also continued to demand wage and pension increases significantly above those contained in American Crystal’s final offer.
    American Crystal listened to the union demands, received the document provided by the union that detailed their demands and evaluated it.
    After due consideration, American Crystal notified the union that their contract demands were not consistent with the Company’s final offer. American Crystal also stated that the Company is moving forward with hiring new employees and other preparations to run a successful 2012 crop campaign.
    The parties remain far apart.
    No future meetings are scheduled.

    • Anonymous Reply Report comment

      June 10, 2012 at 4:18 pm

      Great update.

    • Anonymous Reply Report comment

      June 10, 2012 at 4:20 pm

      Would love to see the union’s press release. Sure it will be skewed the other way. The only way to know the truth is to be in the room.