The Construction Forestry Mining Energy Union (CFMEU) yesterday asked Xstrata to explain why it is axing jobs at its Ulan and Tahmoor mines in New South Wales.
The union’s president Tony Maher called the company “short-sighted and greedy” for cutting the jobs, despite the fact it was “still raking in massive profits from its coal operations.”
“We know that there are geological problems at Tahmoor and we have worked with the company to help manage them,” he said.
“But with the company still making so much money from the coal boom, it is not necessary to cut any jobs.”
Xstrata Coal’s communications manager James Rickards told MINING DAILY the job cuts were necessary to ensure both mines were realigned with the current market.
“At the end of the day, this is about ensuring the whole complex is financially viable,” he said.
“It is always very difficult to let people go, but we have tried to implement a strategy that offers voluntary redundancies in the first instance.
“The majority of those affected at Ulan are contractors, but unfortunately the costs have being running too high and production too low at Tahmoor to retain all of the staff.
“We are not achieving appropriate prices for the product because there simply is not the market demand for high ash coking coal at this time.”
According to Rickards, the CFMEU is basing its position on the prices it received for last year’s coal output.
“We obviously have not been able to secure similar prices in the current financial climate,” he said.
“The CFMEU is very aware of this. We have been speaking to them about Tahmoor for months now about the difficult conditions, the cost overruns and the decisions we would have to make.
“We have kept them informed throughout the entire process.
“These tough decisions need to be made now to ensure that the remaining workers have jobs and that the operations continue into the future so the communities are properly supported.”
According to Maher, the coal industry has been fortunate to have remained highly profitable as it has come through the current global financial crisis.
“It is time that companies like Xstrata accepted more responsibility for looking after its workers who continue to produce enormous profits for the group,” he said.