News From USWA: Unions and Kennecott Reach Accord After Protracted, Bitter, Labor Dispute.

Business Editors

SALT LAKE CITY--(BUSINESS WIRE)--June 24, 2003

The United Steelworkers of America (USWA) announced late tonight that union members at Kennecott Utah Copper Corp. (KUC) -- a wholly owned subsidiary of Rio Tinto plc/Rio Tinto Ltd. of London and Melbourne (NYSE:RTP) -- ratified a new six-year labor agreement with KUC by a margin of 80 percent to 20 percent in a heavy turnout. The Kennecott Coordinated Bargaining Committee (KCBC) -- a coalition of local unions affiliated with five international unions led by the USWA -- negotiated the master agreement on behalf of 1,300 KUC workers.

The agreement was achieved after a bitter labor dispute that dragged on for more than eight months, but did not result in any work stoppages. Despite the fact that KUC bargainers attempted to force what they called their "last, best and final offer" on the KUC workforce on Oct. 1, 2002, the new labor agreement achieved significant improvements over the imposed proposal and previous labor agreements. The improvements include:

-- Wage gains that average $2.40/per hour over the life of the

agreement, depending upon seniority and job classification

-- Continued health insurance for retirees with improvements (a

hotly-contested issue)

-- Improved health insurance for active workers

-- Doubling of retiree life insurance and improved life insurance

for active workers

-- Strengthened arbitration language that especially affects to

company's ability to contract out work, and prevents permanent

replacement of union jobs by outside contractors

-- $6,000.00 early retirement bonuses for qualified workers and

$500.00 ratification bonuses

-- Significant money to settle outstanding grievances (which will

be dropped upon signing, along with litigation surrounding

charges filed at the National Labor Relations Board)

"This agreement is by no means perfect. No labor agreement ever is," said USWA District 12 Director Terry L. Bonds, who led the negotiations for the KCBC. "But when we began our strategic 'Campaign for Justice' more than eight months ago, we knew that we were not dealing with Kennecott Utah Copper Corp. -- we were really engaged in a life or death struggle with a giant multinational conglomerate named Rio Tinto. And we knew, and know, that union-busting is one of the primary aims of that company, wherever it is located in the world.

"So these hundreds of KUC workers who belong to the Steelworkers, the Operating Engineers, the Machinists, the Electrical Workers and the Office and Professional Employees Union -- they and their families and their communities should know that they won the jobs that they have a right to, and they successfully fought for union representation that they have freely chosen. To me, that's a great victory to celebrate, any way that you cut it.

"And we also know, that with our weak labor laws and a right-wing, anti-worker administration in Washington, it is going to be up to us to enforce this agreement, in the workplace, in the courts and in the court of public opinion. During our campaign, we created 'Contract Action Teams' in the workplace to increase communications and take actions when necessary. They will now become 'Contract Accountability Teams,' to nip company violations of our rights in the bud."

Dale Cox of the Operating Engineers added: "Only a few weeks ago, company officials sent around letters to our retirees, telling them that they had no right to health insurance, and maybe the company would not provide any, or maybe they would. It was an absolutely outrageous and cheap fear tactic. But our retirees stood up, and our unions stood up, and we won a continuation -- and even improvement of -- retiree health benefits.

"People say that unions are dying. They say that we can't work together in our mutual interests, that we are greedy. Well, we are alive and well and standing strong. And not only that, by upholding industry standards in our community, we protected and raised the economic standards for the entire Salt Lake region. Everybody benefits, union and nonunion alike."

USWA International President Leo Gerard concluded: "In the mid-1990s, unions that represent workers at Rio Tinto operations around the globe united to form the Rio Tinto Global Network to defend workers against the company's union-busting in Australia, southern Africa and elsewhere. We also began cooperating with environmental groups and human rights groups to stave off Rio Tinto's worst abuses against the environment and indigenous communities in the less-developed world. This struggle has only strengthened those ties.

"Our network has become an active, effective global network that is playing, and will continue to play, an important role in the operations of a global corporation in a global economy."

KUC, based in Magna, Utah (USA) employs about 1,900 mineral mining, processing and support workers at its Salt Lake City area facilities. In 2002, Rio Tinto, which employees about 60,000 people globally, reported US$10.8 billion in gross revenues and US$2.4 billion in gross profits. KUC claimed US$755 million in revenues and US$78 million in net profits. The new KCBC/KUC labor agreement expires Sept. 30, 2009.

www.uswa.org