Union workers at American Crystal Sugar have overwhelmingly rejected a final contract offer. That means workers will be locked out on Monday morning.
Nearly all of the 1,300 union workers voted on the contract Saturday, and 96 percent voted no. Union members are unhappy with higher health care costs and with contract language they feel threatens union job security.
The company and the union have been at odds over the contract for months. One major stumbling block is proposed language that would allow the company to replace union workers with subcontractors, said Mark Froemke, a representative of the AFL-CIO who is on leave from his job at American Crystal.
Froemke, who has worked at American Crystal since 1978, says he was shocked by the provision, which he described as union busting.
"The company would have the right to have the ability to say 'Hey, we're cutting you loose. You're out the door. Goodbye, adios,'" Froemke said. "We've never seen that kind of venom from the company."
The contract included a 17 percent pay increase over the next five years, but Froemke says the other issues trumped the money.
Brian Ingulsrud, vice president at American Crystal, called the pay increase an "excellent offer" and says he is disappointed the employees rejected it.
American Crystal Sugar employs about 1,300 people at five sugar beet processing plants in the Red River Valley. In Minnesota, the company has operations in Moorhead, East Grand Forks and Crookston. Its plants in North Dakota are in Drayton and Hillsboro.
American Crystal Sugar workers are represented by the Bakery, Confectionary, Tobacco Workers and Grain Millers Union, which is part of the AFL-CIO. The company negotiated its last contract with the union in 2004.
But the sub-contractor provision was a major obstacle this round. The company's contract proposal also would limit the union's negotiating power. The proposal reads: "The Union hereby waives its right to bargain over any such Company decision to subcontract work."
Froemke says workers will now wait to see how the company responds.
"We'll go to work at 7 o'clock [Monday morning] ust like normal, and if the message is from the company you're locked out, then that will be the message," Froemke said.
Ingulsrud says replacement workers will be on the job Monday morning. He says there are currently no plans to return to the bargaining table.
"We stated the offer as final, and so I guess we meant final," he said. "It speaks for itself."
Ingulsrud denies the threat of a lockout is an attempt to bust the union, but rather protection for the company as it prepares for the fall harvest.
Ingulsrud says company operations have changed in recent years and American Crystal is starting its factories in August instead of September.
Ingulsrud says any future discussions with the union will need to happen through a federal mediator.