More job cuts are expected at Rio Tinto’s coal mining operations in Queensland after the company announced plans to reduce its operating and support costs by $4.81 billion.
The Construction, Forestry, Mining and Energy Union (CFMEU) says it expects more jobs will be cut in the region after Rio’s chief financial officer Guy Elliot said the miner would look at "every available opportunity" to reduce costs and improve productivity.
"We're going to have some difficult discussions with labour," Elliott told an investors' briefing on Thursday.
The company is targeting coal and aluminium in its cosy cutting operations and said it is considering shutting operations that "don't deliver cash flow", West Business reported
"The escalation of costs that we've seen, well above the rate of inflation … in particular in Australia, is going to have to stop," Elliott told investors.
Elliott said the company would recruit 900 fewer people over the next five years.
“We are taking further tough action to roll back the unsustainable cost increases of the past few years and are maintaining a relentless focus on improving productivity,” Rio CEO Tom Albanese said in a statement.
However, CFMEU has slammed the move and blamed the cost cutting measures on poor management.
"They keep saying costs have gone up but it comes back to the way a lot of these operations have been managed," district president Steven Smyth told ABC
"They flooded them with contractors and excess people at a time when the price of coal was extremely high on the spot market.
"They didn't plan for the future and now they're in a situation where they say that they've got to lay people off because of the high costs.
"I struggle with a lot of that when they're still maintaining the same amount of coal production and huge profits."
Earlier this year.
Rio also closed its Sydney office and cut jobs in Melbourne as it carried out its plan to cut costs in August.