Alcoa’s $5.6b South32 deal puts Worsley Alumina workers’ pay and conditions to the fore

The proposed acquisition of South32’s aluminium assets by Alcoa is bringing employment terms at Western Australia’s Worsley Alumina operation into focus. As the transaction moves towards completion, union members at the South West facility plan to hold a strike, seeking clarity on wages, incentive payments and working conditions.

Members of the Electrical Trades Union (ETU) and the Australian Manufacturing Workers’ Union (AMWU) are preparing for a 12-hour stoppage on Tuesday, coinciding with a scheduled shutdown.

Bonus guarantees emerge as key sticking point

AMWU state secretary Steve McCartney mentioned that around 200 union members employed by South32 at Worsley wanted their remuneration secured before the proposed merger.

While South32’s proposed wage increases were considered reasonable by many workers, the short-term incentive payment remains unresolved.

“Over the past five years, workers have received an average bonus of 10 per cent, and all they’re asking for that payment to be secured in their enterprise agreement,” McCartney noted.

He argued that South32 had referred to incentive payments when defending employees’ overall remuneration, while stopping short of guaranteeing them in the agreement to “protect those earnings.”

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He added that the request was not for higher payments, but for protection of earnings workers had consistently received.

South32 stated that it was engaging positively with employees and representatives during enterprise agreement negotiations. The company spokesperson added that Worsley employees receive benefits beyond their base wages and that the existing short-term incentive policy would continue after the transaction is completed, which, the spokesperson claimed, had been communicated to workers and unions.  

Alcoa-South32 deal puts working conditions under scrutiny

Alcoa announced in July that it would acquire South32’s aluminium assets in a deal valued at more than AUD 8 billion (USD 5.6 billion). The transaction, strongly backed by the South32 shareholders covers South32’s 86 per cent interest in Worsley Alumina, 100 per cent of Hillside Aluminium, 33 per cent of the MRN bauxite mine, 36 per cent of Brazil Alumina refinery and 40 per cent of Brazil Aluminium smelter, expected to be handed over around June 2027.

The deal is expected to strengthen Alcoa’s position as a major upstream aluminium producer with a broader bauxite, alumina and aluminium portfolio.

ETU WA secretary Adam Woodage said workers were questioning differences in wages, hours and conditions between employees carrying out comparable work across the two companies.

Alcoa shift and day workers have a 36-hour working week, while Worsley shift workers work 42 hours and day workers complete 40 hours across four 10-hour days.

“That is a significant difference in working time for people performing comparable work,” Woodage said, adding that employees would question these disparities as the companies combine.

He noted that ETU members wanted an agreement that recognised their skills and contribution to company profits. Woodage also argued that retaining experienced workers and attracting skilled tradespeople were integral to South32’s stated sustainability objectives.

South32 said that it was seeking an agreement that supported employees while maintaining the operation’s long-term sustainability. The company has “plans in place to support ongoing operations at Worsley Alumina” during the industrial action, with no expected operational impact. 

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Alcoa’s WA mining programme awaits approval

The labour hurdles have surfaced amid new regulatory developments affecting Alcoa’s Western Australian mining activities.

Last month, the Western Australian government introduced a new exemption order for Alcoa, stating approval of the company’s 2025–2029 Mining and Management Program was imminent.

The revised restrictions prohibit mining within two kilometres of water reservoirs and increase protection buffers around black cockatoo nesting and significant trees in the Huntly mining area from 10 metres to 50 metres.

The regulations also introduce revised criteria for identifying black cockatoo nesting trees, requiring assessment by independent fauna specialists, alongside additional qualification requirements for those specialists. Alcoa’s exploration drilling footprint is also set to be reduced.  

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