Tomago smelter facing further strike action

The immediate future of a Rio Tinto-backed Tomago aluminium smelter that underpins the NSW energy market hangs in the balance as 560 workers dig in for a fight over pay.

Prime Minister Anthony Albanese speaking to workers at Tomago. Picture: NewsWire/ Adam Yip

The immediate future of a Rio Tinto-backed Tomago aluminium smelter that underpins the NSW energy market hangs in the balance as unions prepare to escalate strike action.

More than 500 workers at the smelter are digging in for a long fight after management refused to budge on a new pay offer, with operations facing significant disruption from Sunday.

The escalation in strike action comes a month after Prime Minister Anthony Albanese and Industry Minister Ed Husic visited the smelter to announce $2bn in incentives to encourage aluminium producers to switch to renewables as part of the government’s Future Made in Australia policy.

Tomago management declined to comment and along with Rio have been silent on the dispute since last week when Australian Workers Union members started industrial action in a move that coincided with the Albanese government pleading with US president Donald Trump to spare the industry from tariffs.

AWU state secretary Tony Cullinan said the union agreed to suspend industrial action last Wednesday and resume negotiations with management, but his attempts to find compromise with Tomago chief executive Jerome Dozol had been futile.

“Despite our members’ significant compromises over recent years, Tomago Aluminium management continues to undervalue their workforce while the (Rio) share price climbs and they hold their hands out for their share of billions of dollars in government support,” he said.

Both sides appear locked in for a prolonged dispute after appearing close in their positions.

Some 560 workers at Tomago are seeking annual pay rises of 4 per cent over three years with two $1000 sign-on payments and back pay. Tomago had offered 4 per cent in the first year followed by 3.5 per cent in each of the next two years, a one-off $1000 sign-on payment and no back pay.

Workers will cut short their shifts by up to six hours on Sunday and plan to take similar strike action on Tuesday.

Tomago consumes about 1000 megawatts hours of electricity and represents about 12 per cent NSW power usage.

Mr Cullinan said workers had effectively taken pay cuts over the past three years as the government struggled to get inflation under control.

“They’ve done their part to support the company’s viability but enough is enough. We can’t continue going backwards,” he said.

The brief industrial action last week resulted in significant production delays at Tomago.

Rio operates two other aluminium smelters in Australia – Boyne in Queensland and a smaller smelter at Bell Bay in Tasmania that runs off hydropower.

The mining giant has said previously that it doesn’t want to run Boyne and Tomago beyond 2030 if the two aluminium smelters can’t move from a reliance on coal-fired power in favour of renewable energy.

Tomago appears by far the most vulnerable after the Boyne smelter’s future was secured last year under a deal with the then Queensland Labor government that could see taxpayers on the hook for hundreds of millions of dollars between 2029 and 2040 if the smelter continues to lose money.

Mr Cullinan said the management’s position was ridiculous and that the AWU had shown good faith in trying to help the aluminium industry survive.

“The AWU has worked constructively with both the government and industry to ensure the long-term viability of manufacturing aluminium production in Australia,” he said.

“We stopped our industrial action last week and committed to no industrial action until Friday (February 21) in return for a commitment from Tomago to return to the bargaining table for intensive bargaining this week,” he said.

“They turned up to the meeting on Monday morning and said that their current offer was a good offer for the employees, and they were going to put it out for a vote.

“AWU workers have had a gutful of being disrespected by Tomago and they are committed to fight for as long as it takes to get a fair deal.”

Originally published as Tomago smelter facing further strike action