U.S. meatpacking giant Cargill Inc. reached a tentative deal with the union representing about 2,000 workers at one of Canada’s biggest beef plants, bringing the sides closer to averting a strike that threatens to disrupt the country’s meat supply.

The offer includes retroactive pay, signing bonuses and a 21 per cent wage increase over the life of the contract for union workers at Cargill’s beef processing plant in High River, Alberta, the company said Wednesday in an emailed statement. The agreement, negotiated as a Dec. 6 strike deadline loomed, needs to be approved by the workers in a vote scheduled from Thursday through Saturday.

“We remain optimistic we can reach a deal before the strike deadline and encourage employees to vote on this offer,” Cargill said in the statement. “While we navigate this negotiation, we continue to focus on fulfilling food manufacturer, retail and food service customer orders while keeping markets moving for farmers and ranchers.”

The Cargill facility accounts for roughly 40 per cent of Canadian beef processing capacity, so any potential labor impasse could have disrupted the nation’s meat supply when beef prices are already soaring amid supply chain snags. The previous contract offer, which included a 19 per cent wage hike over the course of the five-year contract plus a one-time bonus of $1,200 (US$940), was rejected on Nov. 24 by the union members.

If ratified, the offer will be the best food processing contract in Canada. The tentative agreement includes retroactive pay up to $4,200 for many workers, and more than $8,000 worth of possible bonuses, the union said in a statement Wednesday.

“This has been a long and difficult journey for our Cargill members,” Thomas Hesse, president of the United Food and Commercial Workers Canada Union Local 401, said in a statement. “They have stood strong and demanded justice, and I’m happy to see that our bargaining committee finally feels something fair has been proposed.”

Embedded Image

Meat workers have complained about pandemic health and safety after a Covid-19 outbreak last year sickened half of the plant’s staff and resulted in a temporary shutdown. The closure left thousands of cows awaiting slaughter on farm and prompted McDonald’s Corp.’s Canadian unit to import beef to meet its needs. 

The latest impasse came as workers across North America are flexing their bargaining power as a labor squeeze has left businesses struggling to hire and retain staff. A monthlong strike at Deere & Co.’s U.S. plants ended in November after about 10,000 unionized workers accepted a contract that boosted pay and retirement benefits.