Toronto - Employees at nickel miner Vale Inco Ltd.'s Labrador operations have almost unanimously rejected a contract offer by the company and will strike beginning Aug. 1, according to the United Steelworkers union.

The 450 workers at the Voisey's Bay mine and nickel processing concentrator voted 99 per cent against the company's offer on Wednesday, said Wayne Fraser, Steelworkers director for Ontario and Atlantic Canada and a member of the union's bargaining committee.

At issue was the proposed elimination of a bonus tied to the price of nickel and a plan to close the company's defined-benefit pension plan to new employees.

The same issues caused talks to break down between Vale and 3,000 employees at its Sudbury operations in Northern Ontario on Monday.

Steelworkers members in Sudbury will vote Friday and Saturday on the same contract proposal that workers in Voisey's Bay rejected. Mr. Fraser said there is little support for the proposal and he believes a strike is "imminent" in Sudbury as well.

Vale Inco, the Canadian division of Brazilian mining giant Vale SA shut down its nickel mining and processing operations in Sudbury for eight weeks starting June 1 due to weak demand for the metal, which has a variety of industrial uses including making stainless steel.

Vale Inco employs about 5,000 workers in Ontario mostly at operations in Sudbury and Port Colborne. It also has a major presence in northern Manitoba and in Labrador.