SOMBA K'E/YELLOWKNIFE
Layoffs at Ekati Diamond Mine following a process plant fire in late June will impact about 330 employees. Damages are estimated at $25 million.

"Where possible, Dominion Diamond intends to redeploy employees to perform the process plant repairs and clean-up work, or reassign impacted employees to other work," CEO Brendan Bell stated in an e-mail to Yellowknifer.

The mine employs approximately 800 full-time staff and 700 contractors in total and Bell stated the layoffs would impact both employees and permanent and temporary contract workers.

Of the workers at Ekati, approximately 500 are unionized under the Union of Northern Workers - a component of the Public Service Alliance of Canada. First vice-president Gayla Thunstrom told Yellowknifer last Wednesday that within those unionized workers' current collective agreement, provisions are in place dealing with severance around layoffs.

Those provisions, Thunstrom said at the time, include a right of recall for the lost position.

However, if the position is not recalled within 12 months of the layoff, severance would be paid.

These are temporary layoffs and Dominion stated in the release that they are expected to last only the three months required for the process plant repairs to bring the mine back into full production.

Unionized employees are also entitled to take severance upon being laid off, but then forfeit the right to recall their position. Again, how this would come into play in the case of a temporary layoff is not confirmed. Unionized employees do, however, have to be notified of the layoff two weeks prior to the layoff date. If not notified two weeks prior to the layoff, employees receive full salary during that period.

The company first suggested that temporary layoffs might be necessary last Wednesday, though at the time the union had not been notified whether or not its members would be impacted.

The repairs will take the mine process plant out of commission and in the meantime, Dominion is looking at ways to cut costs while the mine limits production.

As well as temporary layoffs, a plan to reduce operations and focus mining on high priority and higher value ore was put in place. This means operations will continue at the Misery open pit and Koala underground mines, but have been suspended at Pigeon and Lynx.

That high-value ore mined is being stockpiled while the process plant is shut down.

"We continue to actively manage this situation, and have implemented a prudent strategy to minimize the impact of this incident on our cash flow. We've planned mining activities to allow for the option to prioritize higher value ore sources on start-up, thereby minimizing the impact on the value of our fiscal year production," Bell stated in a July 5 news release.

The release also stated that Dominion is working with its insurance claims adjustors as the corporation's current policy does cover property damage, as well as business interruption.

In the e-mailed statement to Yellowknifer, Bell called the layoffs a difficult but necessary decision.

He stated, "Dominion Diamond remains committed to our culture of safety, and will continue to operate to the highest standards of safety as we undertake repairs and resume operations."

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