American Crystal: Window for Reaching Deal Is Closing

American Crystal Sugar says it is two-thirds of the way finished processing last year's beets, and "the window for reaching an agreement is closing."

American Crystal Sugar, which locked out 1,300 employees nearly six months ago, met with union officials once again on Monday, but the two sides failed to reach a deal.

Following the meeting, which involved a federal mediator, Crystal Sugar's Vice President of Administration Brian Ingulsrud wrote in an employee memo that the company is about two-thirds finished processing last year's beet crop. That means the company will soon shift its focus to maintenance, which “requires decisions regarding resources to be made very soon.”

“Therefore, from American Crystal's perspective, the window for reaching an agreement is closing,” he wrote.

Ingulsrud told Minnesota Public Radio (MPR) that if union employees aren't back on the job when the company turns its attention to summer repairs, “we need to put in place contracts with outside contractors to make sure that work gets done. And we'll be committed to those contracts.”

Once those agreements are signed, American Crystal would have no incentive to bring union workers back until those contracts expire, MPR reported.

Union President John Riskey, meanwhile, said Monday that the union made concessions on health insurance and the use of outside contract workers during the Monday meeting, according to MPR.

But Ingulsrud says the union didn't go far enough, and the company's final offer remains on the table. In his employee memo, Ingulsrud described the company's offer as “a highly competitive proposal that addresses issues union leaders have raised as their top concerns-including specific language around job security-while at the same time ensuring the company can remain a successful, strong employer in our region and a leader in our industry.”

Ingulsrud said the company is still committed to reaching an agreement, but it is continuing to hire local temporary workers during the lockout.

Twin Cities Business Editor in Chief Dale Kurschner recently traveled to the Red River Valley to learn more about the contentious labor dispute, which involves conflicts over health insurance and seniority issues. To read the resulting feature story published in the February issue of the magazine, click here.

Another piece of the American Crystal saga involves the Farm Bill, for which sugar factory workers typically lobby. Union leaders have said they won't provide such support for the bill, which includes a sugar beet subsidy program, as long as the lockout continues at Crystal Sugar.

“What we have done [in the past] is fought side-by-side with Crystal Sugar and their shareholders and farmers of Crystal Sugar in Washington and lobbied for the sugar program,” Riskey recently told the Grand Forks Herald. “We lobbied labor-friendly Congressional leaders to explain to them what the sugar program does in the Red River Valley and elsewhere where sugar companies are established and told them it creates jobs and good-paying jobs. But right now that is not the case.”

The bill-as well as the sugar industry's powerful lobbying force-has recently generated news headlines and even been the topic of presidential debates. The Star Tribune recently reported that, to protect sugar subsidies, American Crystal's political arm gave $1.16 million to 177 House and Senate candidates and spent more than $1 million on lobbying in 2011. That's about the same level as Cargill, a company almost 100 times Crystal Sugar's size, according to MPR.

Newt Gingrich, meanwhile, alluded to the industry's lobbying force in a recent Florida Republican Presidential debate, saying, “Early in my career, I tried to figure how to get away from the sugar subsidy.”

He described the industry's clouts as “an amazing side story about how interest groups operate,” adding that “the capacity of the agricultural groups to defend themselves is pretty amazing.”