Contractors are facing a pay cut at Rio Tinto’s Hail Creek coal mine as the industry continues to face a downturn.
According to internal documents received by Australian Mining, a recent commercial review by Rio Tinto outlined that for the Hail Creek to remain viable it needs to immediately reduce costs, of which one avenue is the hourly rate of pay for workers on site.
“Like others in the Australian coal mining industry, Rio Tinto is facing the challenge of lower prices. We are working to improve productivity and reduce costs across our mines," a Rio Tinto spokesperson told Australian Mining.
In the wake of this review the major contractor on site – Workpac – has told workers it will reduce their flat pay rate from 18 January, stating, “We have no other choice”.
“WorkPac must reduce its current costs to the client as an alternative to losing our commercial contract and/ or contributing to the eventual demise of the Mine itself,” the contractor stated.
Workers will be sent new letters of offer for work, with Workpac stating those workers who start on site without formally signing the documents will be deemed to have accepted the new agreement.
Workpac was contacted but was unavailable for commenting at the time of publication.
This is not the first labour issue Workpac has faced in the last few months.
Late last month it withdrew offers for new employees hired for the Callide coal mine two days before their induction, and after supplying them with documents and uniforms, according to the Central Telegraph.