Bonus backlash

A local union president said it hurts to learn of AbitibiBowater’s decision to hand out $6 million in bonuses to 50 executives for their work restructuring the company.

AbitibiBowater CEO and president David Paterson told the Canadian Press late last week the company needs the incentives as it rebounds from creditor protection. However, Communications, Energy and Paperworkers’ Union Local 39 president Rick Zuback said the move is ludicrous and immoral.

"We agreed to certain concessions to allow this company to go forward and be profitable," he said. "We agreed to certain job cuts. We agreed to basically an average of a $9,000 cut per year per person for the next three-and-a-half years within our locals to allow this company to come out of Companies’ Creditor Arrangement Act."

The company’s chief negotiator said everyone would be in the same situation and have to make concessions, said Zuback.

"When we see there is $6 million in bonuses being paid to the people that led us down this path of bankruptcy, it’s really disappointing and my members are furious," he said. "We don’t believe this is right, for our industry or any industry."

Zuback said CEP is asking AbitibiBowater to rescind the bonuses or pay it to the people who have been laid off over the past few years; the union believes the bankruptcy was caused by poor decisions made by upper management.

"If they have an extra $6 million hanging around then it should be used for the proper reasons, not to reward their people for basically putting us in this position," he said. "It will be very difficult negotiating in the future with this company and believing we can rust them on their word when we see this frivolous type of behaviour."

The plan will be reviewed later by the company’s new board; it has already been approved by the current board and the unsecured creditors committee.

Zuback said he is not optimistic the company will listen to the union, but he was to keep trying for the members he represents, adding that all workers are part of the team that keeps the mills running.

"It’s not just upper management, but the machine operator or the millwright or the truck driver," he said. "Every job in every mill is just as important as the CEO, as the mill manager."

Paterson said it is standard to pay incentive bonuses during a restructuring process and Abitibi chose not to do so until it had successfully completed the process. Also, since the merger of Abitibi-Consolidated and Bowater in 2007, all executive management salaries have been frozen and no bonuses have been paid.