The Fair Work Commission has handed down an order which could set the stage for the first protected industrial action in WA’s iron ore sector for nearly 15 years.
The Australian Workers Union launched an application for a protected action ballot order against China’s Citic Pacific Mining, which owns the $US15 billion ($23.5b) Sino Iron magnetite mine 100km south-west of Karratha. There are approximately 600 workers covered by the collective enterprise agreement being negotiated at Sino Iron, with the AWU representing the majority of those workers.
The West Australian understands the AWU refused Citic’s pay rise offer, encompassing a 19 per cent salary hike over four years, including an 8 per cent pay bump over the first year. The Union is also seeking a conversion of rosters from two weeks on/one week off to two weeks on/two weeks off, for no loss of pay.
This means workers could get 26 weeks off per year, not including any annual leave entitlements, instead of around 17 weeks.
The Commission on Monday handed down its order for the ballot to proceed, with voting to close on November 6.
AWU members who are involved in the “mining, processing and export of iron ore, iron pallets and other related products at sites operated by Citic in Western Australia” will be eligible to vote.
Industrial action could start as soon as November 10, with the AWU asking its members to vote on unlimited work stoppages for up to 12 hours at a time as it pushes for a new enterprise agreement with Citic.
A spokesman from Citic said the company was continuing to consult with its workforce.
“We remain hopeful of reaching an agreement which rewards our employees for their hard work and recognises the cost pressures being faced right across the community,” the spokesman said.
“We also need to ensure the outcome is financially sustainable for our business during a challenging period for the project.”
The Sino Iron project faced significant cost blow outs and delays ahead of its commissioning in July 2013. In 2019 the project recorded its first annual profit — a modest $14.5m — before finally capitalising on strong iron prices to record a combined net profit of more than $2.2 billion over the past two years.
However, earlier this year market speculation emerged that Citic will cut production at Sino Iron amid a long-running legal dispute with billionaire Clive Palmer, who the company pays around $500 million in royalties to.
Sino Iron supports more than 3000 direct employees and contractors.
AWU WA branch secretary Brad Gandy told the West Australian that although Citic put a pay offer on the table the company refused to negotiate changes to rostering provisions and job grade progression.
“As a result, our members are seeking a bigger pay increase in the place of improved rostering and their log of claims,” Mr Gandy said.
“We are in the middle of negotiations with an employer who refuses to bargain on many of our members’ claims.
“The ball is now in Citic Pacific’s court as our members will continue to negotiate but we are also ready to fight and not back down in pursuit of their claims.”
The West Australian understands formal negotiations on the enterprise agreement between AWU members and Citic started in mid-January this year.
The last major protected industrial action in WA’s iron ore space occurred in 2008 when Rio Tinto train drivers walked off the job following intervention from the Construction Forestry Mining and Energy Union.
WA’s iron ore sector is already facing significant industrial relations obstacles with the Federal Government’s controversial “Same Job, Same Pay” legislation set to have a major impact on the industry.
Labor is seeking to end what it claims is the overuse of labour hire firms to undercut enterprise bargaining agreements but has faced strong opposition from WA’s major iron ore miners.
BHP has said the proposed legislation would have a financial impact of more than $1.3b and directly affect the 17 million Australians that hold BHP shares either directly or through their retirement savings.
Rio Tinto has argued the proposed changes threaten the “productive models of service delivery that are central to attracting investment in Australia”.