Job cuts at Port Pirie Nyrstar smelter despite government-aided redevelopment


November 06, 2018 19:19:21

The Australian Workers’ Union says the operator of the Port Pirie lead and zinc smelter is set to cut 100 jobs at the site.

Key points:

  • Smelter owner Nyrstar confirmed 40 full-time and 60 contract redundancies
  • Belgian company said it was trying to secure smelter’s future
  • Half of a recent $660m development at the site underwritten by State Government

Smelter owner Nyrstar said it was “reviewing its long-term organisational structure” to secure a sustainable future for the smelter in South Australia’s Mid North.

The union said Nyrstar told it there would be 40 full-time and 60 contract redundancies out of about 700 people working at the smelter.

AWU branch organiser Michael Hopgood said the union may contest the redundancies if safety was compromised.

“There may be employees that are required to have more than one person in one job,” he said.

“Now if the company are trying to reduce those numbers by saying that one person can do the job of two, well we would have significant concerns with that.”

Mr Hopgood said while the union was prepared to negotiate with Nyrstar, it would not rule out going to the Fair Work Commission.

Nyrstar has not denied the cuts, and said it was “reviewing its long-term organisational structure”.

“A number of transformation initiatives are intended to assist in ensuring that the Port Pirie smelter will have a sustainable future,” the company said.

Government in deal for recent smelter development

The news comes after the State Government underwrote nearly half of a $660 million site redevelopment to keep jobs in the city.

Under the deal, the Government underwrote a guarantee for the $291 million in external finance raised by the company, which now sits as a liability on the state’s balance sheet.

In May, Treasurer Rob Lucas said the company had indicated it planned to defer payments to its international financiers until November 2019, pushing back the first 18 months of a five-year schedule of repayments.

Opposition mining and employment spokesman Tom Koutsantonis today said the deal to underwrite the smelter overhaul was not a taxpayer gift.

“When the state gives over $290 million to a company [and] they haven’t started paying that money back yet and they’re cutting staff, I think everyone should be very concerned,” he said.

Mining Minister Dan van Holst Pellekaan said the State Government was seeking more detailed information.

“The prospect of job losses at such an important employer in the upper Spencer Gulf is concerning,” he said.

In September, Nyrstar issued a profit warning due to a sharp decline in zinc prices and operating costs.

But in a market update last month, the Belgian company said it was confident Port Pirie would meet earnings targets before tax over the next three years, totalling $270 million.

Unions are expected to meet with Nyrstar management about staffing at the Port Pirie smelter next week.












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