Union relations

We endeavour to have a positive and constructive relationship with the unions in the locations where we operate. Unions play an active role in safety committees at many sites, and in South Africa, union representatives participate in HIV/AIDs steering committees.

All our employees have the right to collective representation, and as of 2010, around 62% of our workforce were unionised (note that because of privacy laws, we cannot collect exact information on union membership in Australia although approximate membership numbers are provided by the unions). We do not believe that any country in which Xstrata operates represents a risk to freedom of association and collective bargaining and we uphold this right at all the operations we manage. Our sites operate a variety of different industrial relations models that include individual site and collective bargaining agreements. Collective agreements are typically negotiated by Xstrata and union representatives every two to three years.

During 2010, Xstrata Coal settled 16 Enterprise Agreements in Australia. Industrial action occurred at three operations resulting in two and a half days lost at Bulga, 36 days lost at Tahmoor and seven days at Collinsville, a contractor-operated site.

The Tahmoor dispute in 2009 relating to the negotiation of a new Enterprise Agreement in accordance with the Fair Work Act, resulted in 36 lost days over the 2009-2010 period. Negotiations continued with the union and Fair Work Australia, which ruled that Tahmoor management had acted in good faith. The dispute was resolved in October 2010 through amendments to the agreement on existing restrictive workplace conditions, providing a fair outcome for workers and the operation.

The industrial action at Collinsville involved a grievance related to an Enterprise Agreement with one mining contractor from Thiess, the site’s operator. The incident was resolved through negotiations with the union. Industrial action also occurred at two operations in South Africa in 2010 resulting in 32 days lost at our Mototolo joint venture, and 21 days lost at Southstock mine.

During 2010, Xstrata Coal experienced an incident involving the Australian trade union Construction, Forestry, Mining and Energy Union (CFMEU) that is not yet resolved:

In October 2010, the CFMEU lodged a complaint with the Organisation for Economic Cooperation and Development (OECD) claiming that Xstrata has breached a number of OECD guidelines during the course of its operations in Australia. Xstrata Coal has cooperated with OECD’s National Contact Point in Australia to address the claims put forward by the CFMEU. Our position is that there is no basis for the complaint. The National Contact Point is continuing to liaise with both parties.