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Kennecott workers brace for big layoffs

Published May 31, 2013 9:16 pm

Mining • Light response to buyout offer may mean bigger cuts, Kennecott says.
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Fewer workers than hoped have stepped forward to embrace an early retirement package at Kennecott, raising the prospect that looming layoffs at the Utah copper giant will be larger than they otherwise might have been.

"We're pretty sure we'll have about 100 people accepting the early retirement package" by the June 1 midnight deadline, said Wayne Holland, international staff representative for the United Steelworkers of America, which represents about 1,500 of the 1,800 union workers at the Utah copper mining operation.

Holland previously indicated that as many 150 employees had expressed an interest in taking the buyout.

In early May, Kennecott offered 275 qualified employees a $20,000 early retirement bonus in an effort to lessen the blow of a pending layoff. The cuts in coming weeks are expected to significantly impact hourly workers who labor at the company's Bingham Canyon Mine, concentrator and smelter on the eastern slope and northern end of the Oquirrh Mountains.

Those workers will be idled because of the massive landslide at the mine on April 10 that saw 165 million tons of rock tumble down the northeast slope of the 4,000-foot-deep open pit. The landslide was anticipated and all employees had been evacuated ahead of time, but expensive equipment was heavily damaged and operations were impacted.

Mine officials have estimated the landslide, one of the largest in mining history, will cut ore production in half this year.

"The number of those who take early retirement definitely will impact how many (hourly employees) get laid off," said Kennecott spokesman Kyle Bennett,who estimated the company's workforce totals 2,400 hourly and salaried employees. "I can say this, we're still talking with a number of employees who are considering taking early retirement, answering their questions and explaining the package we're offering."

Last week, Kennecott announced the first wave of layoffs among its workers, terminating 100 salaried employees, or 14 percent of that employee segment, who at the time numbered 700 people.

Bennett noted then that those layoffs represented a permanent reduction in the number of Kennecott's employees in Utah. "These are role reductions," he said. "They are separating permanently from the company."

What isn't clear right now is when Kennecott will to announce the number of hourly employees it intends to lay off, although word is expected soon, perhaps as early as next week.

Holland said that under the company's contract with the unions that represent hourly workers, Kennecott must provide a five-day advance notice and a list of the employees it intends to lay off prior to taking any action. "And I haven't received that notice yet," he said Friday.


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