BHP contractor sackings tip of corruption iceberg, says whistleblower

The mining giant is stepping up efforts to get to the bottom of a corruption scandal involving its coal operations in Queensland after swinging the axe on dozens of contractors.

BHP is expected to sack more contractors over allegations of widespread corruption over a number of years. Picture: BHP

BHP is stepping up efforts to get to the bottom of a corruption scandal involving its coal operations in Queensland after swinging the axe on dozens of contractors.

The contractors shown the door so far were all hired for work at the Saraji mine. Four other mines in BHP’s coal stable are under scrutiny amid allegations of widespread corruption over a number of years.

The BHP investigation, revealed by The Australian, remains in its early stages, with suggestions the contractor sackings will spread across the BMA coal business owned in partnership with Mitsubishi.

There are allegations one contractor became abusive and threatening when a BHP manager who suspected corruption asked to see invoice and timesheet details. BHP launched its investigation on the back of one of its managers raising the alarm.

A whistleblower who contacted The Australian on Thursday alleged corruption was widespread and said they had raised concerns with police and the Australian ­Securities & Investments Commission.

Speaking on condition of anonymity, the whistleblower said tens of millions of dollars were involved over the past five years.

“There are others who are willing to come forward to expose what has been happening over a period of years. BHP has dropped the ball,” the person said.

It remains unclear if any BHP employees have been sacked at Saraji or from other parts of the BMA business.

BHP’s response to date includes instructing international labour hire firm Hays to remove 26 contractors after a review found they were not required at Saraji in the Bowen Basin.

Hays, one Australian biggest labour hire players, did not respond to a request for comment. It is not accused of any wrongdoing.

BHP’s investigation remains in its early stages. Picture: AFP

BHP is investigating whether contractors were hired from within BMA for non-existent work, or for jobs where the extent of the work was greatly exaggerated.

The mining giant has indicated it will not provide additional comment while the corruption allegations are under investigation.

In its only comment so far, a BMA spokesman said the business had “robust measures in place to prevent and detect fraud and misconduct”.

“We encourage anyone to speak up if they have concerns any conduct is inconsistent with our code (anti-corruption guidelines), internal requirements, or conduct that may be illegal or improper,” the spokesman said.

BHP investigators will try to determine the financial impact of any improper or unwarranted payments, and how the contracts were issued. Any illegal conduct will be reported to police. It is understood lawyers attached to BHP’s compliance division are running the investigation. BHP’s anti-corruption guidelines prohibit authorising, offering, giving or promising anything of value directly or indirectly to anyone to influence them in their role, or to encourage them to perform their work disloyally or improperly.

A BHP insider said a business of BMA’s size had to maintain a constant vigil against corruption and attempts to rip it off.

BMA is Australia’s biggest exporter of seaborne metallurgical coal and operates five mines in the Bowen Basin – Goonyella Riverside, Broadmeadow, Peak Downs, Saraji and Caval Ridge – as well as owning and operating the Hay Point Coal Terminal near Mackay. The mines have some autonomy in their management and issuing of contracts.

The Queensland coal mines incurred the wrath of BHP bosses last year when the company docked employee incentives around the globe, based on failures to hit internal performance targets on costs, production, safety and gender equity.

BHP told thousands of workers last July that it would only pay out 80 per cent of short-term incentives that were up for grabs in 2023-24. Workers at BMA copped an extra penalty and received only 70 per cent of the incentives after two downgrades in sales guidance and a fatality at the Saraji mine.

Originally published as BHP contractor sackings tip of corruption iceberg, says whistleblower