The “salary” settlement at the global iron ore export hub is difficult to solve! BHP Billiton (BHP.US) Port Hedland workers will seek arbitration over salary agreement dispute

The Zhitong Finance App learned that the BHP Billiton Ports Joint Trade Union representing the global mining giant BHP Billiton (BHP.US) port facility workers in Port Hedland, Australia, said on Tuesday that since the two sides failed to agree on the terms of the new salary agreement, the workers will seek arbitration.

According to reports, the BHP Billiton Ports Joint Trade Union represents about 450 operators and maintenance workers at the Port Hedland facility. The union will determine the application as an “irreconcilable negotiation”, which will allow the regulator's Fair Work Commission to set terms for the agreement between the parties.

The union and BHP Billiton have been negotiating a four-year salary agreement for more than nine months. In recent months, the two sides have met almost every week with the assistance of regulators to determine the specific terms of this four-year pay agreement.

The union said in a statement: “BHP Billiton is unwilling to negotiate an agreement that reflects the professional skills, poor working conditions and huge personal sacrifices made by these employees, and it is these employees who have generated more than 13 billion Australian dollars in profits for the company this year.”

A BHP Billiton spokesperson responded, “Our focus remains on reaching a fair and reasonable agreement.” The mining giant said its latest offer was made a week ago, adding that continuing negotiations is the fastest way to reach results.

For most employees, BHP Billiton proposed a 17% salary increase over the four-year period of the agreement, including a transitional payment of 25,000 Australian dollars (approximately US$17,800), which will be paid over two years, while also increasing shift allowances. However, the trade union believes that the actual treatment of about 40% of employees will deteriorate under this plan.

The protracted wage tension between BHP Billiton and Port Hedland workers is likely to have an impact on the global iron ore supply chain. Port Hedland is one of the world's largest iron ore shipping ports and Australia's largest iron ore export port. The port connects BHP Billiton's mines in the Pilbara region and undertakes all of its iron ore export business in Western Australia. According to the data, about 80 million Australian dollars worth of BHP iron ore products are transported through the port every day. If Port Hedland's operations are disrupted, the economic losses may be enormous, and it will also put pressure on the global iron ore supply chain.

In August, workers at the port stopped work for two days, the first major industrial operation at the port in 25 years. If negotiations between the two sides do not continue to progress, a potential strike could affect the daily operation of the world's largest iron ore export hub.