Australian Mining Industry and The Workforce Shuffle

  • Apr 20, 2020 AEST
  • Team Kalkine
Australian Mining Industry and The Workforce Shuffle

The Australian mining industry is calling-off an ongoing workforce relocation to deal with many interstate bans imposed by the state authorities in response to the COVID-19 outbreak.

The mining companies across the continent are setting a paradigm of better operational management via changing the domicile of many fly-in flay-out workforce essential for smooth transaction of their daily operations.

As per a leading media house, the tally of Australians moving interstate over the past month has reached to ~ 5000, and it should not come as a surprise as many mining companies are prompting the workforce to pack bags and relocate.

The ongoing trend, albeit is much more from eastern geographies of the continent to Western Australia, is now ongoing national with many miners relocating the essential workforce to the state of operations.

How Are the Australia Miners Playing the Workforce Card?

The COVID-19 pandemic has called for a massive adaptation among the mining industry, with many miners pushing things differently to reach operational efficiency.

Rio Tinto Limited (ASX:RIO) recently announced that the Company has changed rosters at its Iron Ore operations, construction and exploration projects, leading towards fewer crew changeovers to contain the spread. The miner has also relocated majority of employees and critical contractors which previously were on a national fly-in fly-out arrangements to Western Australia, where the miners run middle-of-the-road operations, specifically iron ore projects.

Likewise, post the announcement from Western Australian State Government related to strict border controls for all access points by road, rail, air and sea, Fortescue Metals Group Limited (ASX:FMG) utilised the exemptions given by the State Government to mining industry workforce and suggested that while the majority of its workforce resides in WA, the Company would further work in association with resources industry and the WA State Government to relocate its non-resident workforce from site to work from home.

The Company also introduced a temporary change in site operational roster from a two week on/one week off to a four week on /two weeks off to crimp the travel time to and from the operational sites by ~ 40 per cent.

To Know More, Do Read: Four Iron Ore Stocks Under Positive Territory Amidst Market Turmoil- Rio, FMG, CIA, and S32

Western Australia has become the hub of mainstream relocation with companies like Saracen Mineral Holdings Limited (ASX:SAR) introducing longer FIFO (fly-in fly-out) rosters from 5 days on / 13 days off and 8 days on / 6 days off to at least 3 weeks on / 3 weeks off.

While the recent interstate ban has prompted the shuffling for the essential workforce from their domicile to the state of operations, majorly Western Australia, the same ban on the larger scale, i.e., cross border, has prompted many mining companies to defer their plans of shifting their operations outside Australia.

In the middle of workforce relocation and increased roaster timings, BHP is also coming up with its massive ongoing relocation. The miner has joined the vast growing list of miners bringing changes to workforce roasters and FIF arrangements with a recent relocation of 300 people from eastern states to WA to bring down the quarantine complications coming into the picture with interstate and national borders restriction.

The mining companies across the continent seems to be utilising the exemption from the Federal Government imposed lockdown as resource industry workers are classified under essential workforce category by the Federal Government.

Rescheduling of Operational Shift Outside Australia

Champion Iron Limited (ASX:CIA) recently announced that the Company has decided to not proceed with the re-domicile proposal from Australia to Canada due to the recent pandemic outbreak of COVID-19 and ongoing market volatility and global uncertainty.

The Company reckoned that due to the ongoing high market volatility and global uncertainty, it might not be able to realise the benefits associated with the Re-domicile.

The Board of the Company fathomed that the decision would be in the best interest of its shareholders, and finally decided to defer the re-domicile of the business from Australia to Canada; and,

  • CIA also sought approval from the Federal Court of Australia; however, suggested that the Board may reconsider the re-domicile from Australia to Canada at the later stage, depending upon the market condition.

In a nutshell, the ongoing market turmoil has prompted many mining companies to reshuffle their workforce and increase roaster to maintain the operational efficiency and to deal with the COVID-19 spread. Many leading miners such as Rio Tinto, Fortescue Metals, BHP Group, OZ Minerals are coming into the limelight by setting the paradigm of better operational management in these hard times.

While many miners are shuffle workforce, miners such as Champion Iron is calling-off their re-domicile outside the continent in the wake of COVID-19 outbreak and high market uncertainty and volatility, which is estimated by them to offset the benefits associated with the re-domicile of the business.

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