Will pay severance for displaced Abitibi workers: Williams

The Newfoundland and Labrador government said Tuesday it will step in and pay severance and other benefits to workers who lost their jobs when AbitibiBowater shut down a mill in March.

Still struggling for its survival, AbitibiBowater has yet to pay severance to mill workers and others who lost their jobs when the century-old Grand Falls-Windsor mill closed.

Premier Danny Williams, who made the announcement in Grand Falls-Windsor on Tuesday with other cabinet ministers, said the package will be offered to unionized and non-union workers, including loggers and silviculturists.

"Many of these individuals have given a lifetime of service to AbitibiBowater and deserve to be treated with dignity and respect in the face of this closure," Williams said in a statement.

"Unfortunately, that has not been the case to date by the company."

Rick Fudge, the head of the union local representing loggers who did not have severance in their contract, said they're overwhelmed.

"Obviously it's just going to open up doors for them, allow them to continue on with their lives, and give us more time to figure out where we go from here in terms of new industry and other things, so it's just a great day," he said.

Williams sparked an outrage from AbitibiBowater executives when his government introduced legislation that expropriated the company's timber and water resources last December.

"It is now only appropriate and fair that the workers are not left behind and disadvantaged by Abitibi's decision to close this operation," Williams said.

AbitibiBowater sought and won protection from creditors in Canada and in the U.S. while it attempts to reorganize its finances.

In its statement, the government said that "any disbursements of payments" to unionized workers will now be repaid to the provincial government instead.

The government did not provide an estimate of the cost of its decision in a statement.