Union leaders at the world's top copper mine, Escondida, on July 28 called on workers to reject a final wage offer from BHP Billiton, raising the prospect of a strike at the world's largest copper mine at a time of tight supply and high prices.
The union said in a statement on Wednesday that BHP's offer at the end of regular wage negotiations in Chile failed to meet workers' demands for longer working hours to boost productivity and profits. The 2,330 members will vote on the proposal by July 31.
Workers at Escondida went on strike in 2017
Unions say strikes are the only tool left to workers in such situations to force them to urgently correct management practices. The union believes the onus is squarely on BHP to avoid a serious conflict.
While Chilean Labour rules allow either side the option of seeking mediation before a strike begins, unions roiled the copper market in 2017 with a 44-day strike. Disruptions to mines that produced 1.2m tonnes last year will have a huge impact on global copper supplies just as the global economic recovery is boosting demand.
In addition, high copper prices have prompted Chile to seek a bigger share of mining revenues, and Chilean lawmakers are discussing a royalty bill as a source of funding to address the country's socio-economic disparities. As ore grades fall and input costs rise, mining companies are struggling to contain Labour costs in a cyclical business.
While the terms of the Escondida offer were not disclosed, the union is asking for an additional bonus of 1 percent of the dividend to be paid to the mine owner to honor workers' sacrifices during the outbreak.
In a statement, BHP said its offer improved current conditions and added new benefits to a list of priorities for workers. This is based on dialogue with the First Union and reflects the company's efforts to establish a mutually beneficial agreement based on dialogue and mutual cooperation.
