Mine workers were told on Friday they would be locked out for seven days after the majority of the workforce voted in favour of taking further industrial action in the form of bans and limitations around production.
The move comes after Peabody idled the mine for 72 hours earlier this month “as a result of disruptive industrial action initiated by the CFMEU”, which has included two 48 hour strikes and limitations by the workforce.
The dispute centres around a new agreement proposed by the multinational miner which will see workers receive zero, two and two, plus bonuses over a three year period.
However, the CFMEU says this will put workers 20 per cent behind other operations in the Illawarra and are pushing for 4per cent wage increase on workers’ hourly rate in exchange for a 4per cent sacrifice on production bonuses.
The CFMEU said members were sceptical of bonuses contained in Peabody’s offer as they were ‘‘subject to logical problems’’ and the ‘‘company’s whim’’.
‘‘It’s what we call an at-risk component of our wages and we’re not prepared to offset an hourly wage increase with an at-risk bonus increase,’’ CFMEU south-western district vice president Bob Timbs said.
The Illawarra Mercury reports that CFMEU Helensburgh Lodge President Andrew Davey said Peabody’s offer was a ‘‘kick in the guts’’.
‘‘We do the best we can do and that’s proven in the figures,’’ he said.
Timbs said the camp would be manned 24/7 during the lock-out.
He said the protest would remain civil with the workforce allowing contractors in and out of the site.
‘‘It’s just about having a presence here to show the company we’re fair dinkum and we are going to dig in and take them on for what we believe is a fair pay deal,’’ Timbs said.
‘‘We’ll have 200 people here spread out around...24 hour periods.’’
Peabody has said it will reopen the mine should the industrial action around bans and limitations be withdrawn.
“Peabody remains committed to delivering an agreement which reflects current market conditions, lifts productivity, reduces costs, enhances safety and provides greater job security for Metropolitan mine employees,” the spokesperson said.
"Metallurgical coal fundamentals are improving and continued build out of new generation is driving record thermal coal demand. Supply rationalisation is continuing as higher cost mines in the US and China close, and other exporting nations face increased domestic demand and rising costs,” Peabody chairman and chief executive Greg Boyce said.
Lower coal prices for its Australian operations were partly offset by a boost in production, with shipments increasing by 6 per cent to nine-million tonnes of coal.
However third quarter revenues amounted to $US1.8 billion, down from $US2.06 billion in the corresponding period last year. Peabody cited lower prices in both US and Australian markets for the fall.
Earlier this year Peabody took the axe to its Australian workforce, cutting 400 contractor roles in June and another 400 roles across NSW and Qld in July, as it attempted to conduct a ‘repositioning and improvement program’ to reduce costs.