#10 - JRL 7168
Moscow Times
May 6, 2003
Norilsk a Landmark Victory
By Boris Kagarlitsky

Who could have predicted just a few months ago that the mayoral election in Norilsk would turn out to be a political event of national importance? Norilsk Nickel was considered an oasis of social prosperity, and the city a model of political stability. The company controlled everything in Norilsk, and the residents seemed quite satisfied with that arrangement. After all, the average wage at Norilsk Nickel is $700 per month -- big money by Russian standards.

Yet well-off Norilsk has become a hotbed of social conflict. And not by chance. The city's prosperity is a by-product of the company's near monopoly on the world market. Norilsk Nickel's miners don't compete with their poorly paid compatriots or with half-starved miners in Africa. Their main competition is in Canada. In other words, salaries at Norilsk Nickel may look great in the Russian context, but by international standards they could be significantly increased.

More important, Norilsk Nickel's collective agreement with its employees includes a promise to index wages to inflation. Unfortunately, the company reneged on its promise. Meanwhile, the cost of housing, utilities, public transportation and daycare in the city rose faster than the national average.

Norilsk's workforce is stable, and the workers are confident. As a result, the unions play hard ball. Before the company responded to their demands, the unions initiated a labor dispute, the first step toward a strike. Labor law makes it exceedingly difficult to initiate such disputes by setting out a lengthy, complex procedure. Among other things, the applicant must convene a conference of all affected employees. These conferences were common in the Soviet era, and Norilsk Nickel put this experience to good use. Labor leaders maintain that management handpicked the candidates to the conference and rigged the voting. Union officials were sidelined during the meetings. The local press, controlled by Norilsk Nickel, accused labor of trying "to devour" the company. In protest, union leaders began a hunger strike, but were forced to call it off for health reasons.

Norilsk Nickel emerged victorious, but then came the mayoral election. Union leader Valery Melnikov announced his candidacy.

Company executives insist the labor dispute was concocted to boost Melnikov's popularity (there's no smoke without fire, as they say), but it no longer matters what Melnikov's original intentions might have been. The important thing is the city's voters backed him at the polls despite the active opposition of the local press, which is controlled by Norilsk Nickel. The election was nothing less than a vote of confidence in both the company and the union. The result speaks for itself. Melnikov received 47 percent of the vote, while his closest rival, Sergei Shmakov, the city council chairman reportedly backed by Norilsk Nickel, received just 34 percent. By some accounts, Melnikov actually cleared the 50 percent hurdle required for victory in the first round, but city officials on the Norilsk Nickel payroll falsified the result. City Hall got more openly involved before the run-off election: Melnikov was charged with exceeding the campaign spending limit and struck from the ballot. The charge was a bad joke -- of all the candidates, Melnikov had the least money at his disposal.

The court was so blatantly biased that even Melnikov's opponents condemned its decision. Had Shmakov become mayor under these circumstances, he would have faced the ire of a majority of his constituents. He wisely withdrew from the race, and the remaining candidates followed suit. Symbolically at least, Melnikov was acquitted by the local political elite.

In the end, Norilsk wound up with a clear winner but no mayor. Melnikov's success was unprecedented. For the first time, a union leader in Russia won an election of this magnitude. His victory was the direct result of his union's uncompromising stand in its dispute with Norilsk Nickel. The rest of Russia's labor leaders, who generally avoid conflict with management, should take heed.

Paradoxically, the court's decision to strike Melnikov from the ballot has increased his authority and influence -- and not only in Norilsk. State Duma elections are just around the corner, and Melnikov could well decide to run. In the North, where people were exiled in the Stalin era, the Communist Party wields little influence. Perhaps that is why Norilsk is where the labor movement has emerged as an independent political force for the first time in ages.

Boris Kagarlitsky is director of the Institute of Globalization Studies.