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President BHP Flat Products Lance Hockridge said he was extremely disappointed by today's vote for a 24-hour stoppage at the Port Kembla Steelworks.

"We understand that the vote could have gone either way and believe that many employees are aware of the challenges facing our business and the world economy generally."

"We have put an Enterprise Bargaining Agreement offer on the table which we consider to be fair, responsible and generous given the state of our industry. The unions can deconstruct it any way they want but at the end of the day this package has a potential upside of up to 16% over two years," he said.

"In fact, including a performance-based component in the offer will enable everybody to share in the success of the business if it performs well. This is the case for both senior management and employees at the Port Kembla Steelworks."

The package commits the company, employees and the unions to work together to ensure BHP Steel becomes a robust, stand-alone steel company. It provides for:

  • Increases in wages and associated allowances by a total of 6% over two years.
  • Enhanced long service leave provisions equivalent to 1%.
  • An annual variable incentive scheme which, with solid performance, could yield between 2% and 7% over and above the current PRPS/LSPS scheme. (These schemes would be replaced with a new one.)
  • A $1500 share issue (based on meeting deliverables associated with a successful public listing of the company). This is equivalent to a further 2%.

"We have always said that we are prepared for further negotiations with employees and unions around key issues, including employment security as an outcome of a successful business.

"Upon returning to work tomorrow, I would encourage all employees to sit down with their supervisors to discuss exactly what the Enterprise Bargaining Agreement means for them.

"It is even more unfortunate that this action should occur on the day that the United States International Trade Commission has announced a finding of injury to US steel producers, in relation to the Section 201 Enquiry concerning overseas imports of steel products.

"This now puts us in a position of having to fight hard to retain the 800,000 tonnes per annum (worth some AUD$400 million) of steel that this business exports to the United States.

"Today's decision further highlights the terrible conditions facing producers and reinforces our view that the offer we have made is not only fair, but also generous.

"Our overriding objective is to secure the long-term viability of the Port Kembla Steelworks for the benefit of all stake holders including employees, our customers, BHP Steel shareholders and the Illawarra community."

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